Canadian ethics are not compromised by foreign investment
September 10th, 2012 | By: Jamie Ellerton
This article first appeared on the Huffington Post Canada
In the same week that China’s National Offshore Oil Company (CNOOC) applied for federal approval for its takeover of Canadian oil company, Nexen, Kuwait’s state-owned company was reported to have signed a deal with Canada’s Athabasca Oil Corp. That’s two countries, known for poor ethics, buying a piece of the Canadian oil patch. And yet, our oil remains as ethical as ever.
Not everyone gets that, of course. Rick Smith, head of the anti-oil political activist group, Environmental Defence, suggests that even exporting Canadian oil to China would immediately compromise our legitimate claim to producing the world’s most ethical oil. It’s true that Rick Smith is an extremist who would say anything to undermine Canada’s oil industry. But even reasonable Canadians might wonder if allowing oil companies from unethical regimes to invest in our exceptional resource risks compromising our stellar ethical reputation. The simple fact is: Canada ranks among the most ethical countries on the planet. No foreign investor is able to change that.
Investors from unethical places have invested in Canada for a long time; it doesn’t change the values that Canadians uphold in our business and our society. In fact, the Canadian values so integral to the way we operate is very much a part of the reasons that global investors from all sorts of places choose to invest here. When the Saudis — as unethical a regime as you’ll find anywhere — bought a stake in the Four Seasons hotel chain, founded by Canadian Isadore Sharp, they paid billions of dollars to get their hands on a world-class, quality brand known for having among the finest employees in the hotel industry. Investors pay a premium for Canadian firms because they want to own firms that operate by Canadian principles (CNOOC is offering Nexen shareholders 61% more for their stock than the pre-bid market price). If the Saudi royals introduced their abusive, unethical sharia values to Four Seasons, they’d destroy the very value of the company they paid so much to get their hands on.
The same is obviously true in our oil industry. Canada has an incredible amount of oil, but we don’t have on a monopoly on it. What we do offer investors, that Venezuela, Russia and Nigeria do not, is a secure, peaceful place to business. We offer a stable and lawful investment climate where the government doesn’t whimsically seize property from owners. We don’t have corrupt politicians with their hands out for bribes as they cut regulatory corners, harming the public to help themselves. And we boast a creative, educated and highly skilled workforce, full of workers proud of what they do every day and unwilling to settle for the shameful environmental and labour standards of conflict oil producers.
Investors — wherever they come from — also come here knowing that Canadians own the energy resources in this country, and we make the rules about how they can be produced. And our rules are stringent. We have a diverse country that does not tolerate discrimination. The public insists, through our laws, that our environment is well taken care of and that workers are treated to the highest safety standards and rights anywhere. We even require, again through law, that aboriginals are included in any decision process affecting them. These codes of conduct are every bit as high, and mandatory, for CNOOC and Kuwait Petroleum Corp. as they are for Canadian-owned firms.
This is what being an ethical oil producer is all about: It’s about Canadians, and the values we uphold in society and business. The fact that investors continue to flock to our country in increasing numbers, from all over the globe, and agree to practice standards so far above what they’re used to at home, only proves that they appreciate the value of the way we do business. Canada’s oil industry has set a tremendous example for the world in so many ways — not least the pioneering innovation developed right here to extract previously unusable oil resources from the oil sands in an economic and environmentally sustainable way. But the most striking lesson we teach international businesses every single day is how unsurpassed ethics are good for business. Our profitable, globally admired businesses are coveted by investors not despite the way they operate, but precisely because of it.
Although CNOOC and Kuwait Petroleum are no doubt eager to learn as much as they can about how Canadians have melded unrivaled ethical standards with business success, it would be naïve to presume that their investments mean China and Kuwait are about to suddenly transform into peaceful, democratic, free societies intolerant of discrimination and abuse. But when capital from Kuwait and China comes to Canada, it does mean more support for our ethical oil. That not only means capital redirected away from investments in less ethical countries; it also means more capital used to bring yet more of our ethical oil to market. And the more ethical oil we can bring to the world, the more we can finally break the stranglehold that conflict oil countries have had on the global oil market for so long.
Wherever they come from, when investors come to Canada, keen to do business here according to Canada’s ethical standards, it only vindicates the importance of the values our country stands for, and only makes Canada’s ethical oil a stronger force in the world.