The Australian Democrats' Corporate Code of Conduct Bill 2000 is being scrutinised by the Parliamentary Joint Statutory Committee on Corporations and Securities. The Bill aims to regulate the activities of Australian companies overseas in the areas of human rights, environment, labour and occupational health and safety. My advice to the Committee is to scrap the Bill. It says more about the Democrats agenda than about corporate behaviour. It is the next instalment in a much bigger game, to make global moral activists the rule-setters and monitors of corporate behaviour.
Its impact will be to weaken the prospects of Australian multinationals operating overseas by subjecting them to standards of conduct additional to those imposed by a host country. It will create the opportunity for Australian competitors and other interested parties to interfere in the operations of Australian multinationals. It will not assist the supposed beneficiaries, the poor or the environment. It is a ruse to replace the old rule makers of corporate conduct -- the parliament -- with the new -- Non-Government Organisations and the courts.
The Second Reading Speech of Senator Bourne is a scandal of unrelated diatribes in search of problems, problems to which her Bill provides no solutions. She recalls the cyanide spill at the Australian owned Esmerelda mine in Romania. But Esmeralda was fined by the Romanian government. As a consequence the company no longer exists. Of what use is the Bill? She recalls the environmental damage caused by the Ok Tedi mine. BHP is, in effect, a joint partner with the PNG government in this venture. If it pulls out the PNG government will seek another, possibly less able partner, to pursue the venture. The Bill suggests that the Australian government should legislate for the PNG government, an overt piece of imperialism. What of the rights of other nations to establish their own regimes for corporations and make their own judgements about development and the environment?
She perpetuates the Brent Spa myth. In 1995, Shell Oil was granted permission by the British to dispose of the North Sea oil rig Brent Spar in the North Atlantic Ocean. Greenpeace maintained that there were hundreds of tonnes of petroleum wastes on board, and that some of these were radioactive. A boycott of the company cost the company millions. The deep-sea disposal was abandoned. Independent investigation revealed that the rig had been properly cleaned and did not contain the toxic and radioactive waste claimed by Greenpeace. Greenpeace apologised to Shell for its wrong allegation. Why does the Senator act as if Greenpeace was right?
She perpetuates the myth that poverty is caused by corporate imperialism. "Globally there are 100--200 million children between 4 and 15 years old, labouring in mines, making matches, cooking, washing, weaving, sewing and working in fields, building sites and rubbish tips". But the greatest gains in standards of living have generally been made in those regions and nations where trade, new technology and foreign direct investment have been greatest. Multinational corporations have often been the vehicles for these developments.
The Bill establishes a series of standards of conduct for corporations of the most general kind. These standards are to be reported to the Australian Securities and Investment Commission and in turn to the Parliament. Based on these general standards, not only will a person suffering a loss or damage because of the action of a corporation have a cause of action, "an association of persons whose principal objects include protection of the public interest" may bring an action.
What is the public interest in these instances? The Bill borrows the 1999 European Union standards for European Enterprises operating in developing countries. Presumably a EU multinational, operating in Australia, could have a complaint brought against it by an Australian, based on the EU Code of Conduct. That complaint may mean that Australians using European conventions may sideline the interests of other Australians, especially the taxpayer. To the extent that NGOs complain about multinationals, globalisation, and the loss of sovereignty suffered by nations, the Code of Conduct may well inhibit rather than enhance one concept of public interest, national sovereignty.
The distinct impression is that the Bill is designed to deal unelected and self-appointed moral activists into the game, and deal governments out. This tactic leads to the conclusion that governments will need to know more about the integrity and organisation of NGOs. If NGOs desire to have a role in setting standards of conduct, and standing in the complaints process, then they must be subject to the same scrutiny as are corporations and governments.
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