By Michael MacMillan
Socially-conscious investors -- those who refuse to invest money in companies that display a lack of environmental or community awareness -- are becoming a force in the financial community. Recognizing this, one group, the Social Investment Organization (SIO), has dedicated themselves to helping them find a balance between high returns and social responsibility.
The SIO takes care of the homework for investors, analyzing particular industries on their behalf and grading achievement in such areas as pollution, aboriginal concerns, and employee relations. A report published at the conclusion of the study paves the way for informed investment decisions.
Recently the SIO scrutinized Canada's electric utility industry. After an intensive eight-month consultation process involving industry, environmental, and labour representatives, they released their conclusions in a three-volume report. Besides rating utilities in several key areas, the SIO also examined what impact, if any, deregulation might have on publicly-owned utilities and their commitment to social justice.
Overall, provincial utilities fared well. The SIO concluded that on the whole, the industry has an "uneven" but solid social and environmental performance record, with noticeable differences between private and public companies (while excelling in some areas, private utilities generally lag behind their public counterparts). Utilities earned their highest marks in the area of employee relations (ranked highest of any industry assessed by the SIO thus far), workplace diversity, environmental concerns, and to a lesser degree, the development of alternative fuels and cogeneration.
Among the major weaknesses; a lack of women in the workplace -- although the SIO found this to be a problem almost exclusive to private utilities; continued dependence on coal and other environmentally-harmful fossil fuels, native land claim issues, and the damage to the ecosystem caused by large-scale hydro projects.
But the SIO stressed that these ratings only provide a snapshot of the industry.
Deregulation, they caution, could adversely affect any or all of these findings. They believe that as public utilities follow the general North American trend toward privatization, cost-cutting measures could threaten existing environmental programs. And the pressure on utilities to compete could leave thousands unemployed.
"Whether (these) traits will survive current restructuring processes remains to be seen," stated the SIO in its Social Investment Profile Report.
The report was also critical vew of they way in which the industr handles native issues. Provincial utilities, the SIO found, have not properly addressed native land claim concerns. In particular, the SIO called on utility managers to come to terms with local land concerns, reminding them that Òthe Cree of Quebec in their dispute with Hydro-Quebec over the second phase of the James Bay project demonstrates the potential dangers of neglecting Native concerns.Ó
The reference is to the "Great Whale" project Hydro-Quebec attempted to undertake in northern Quebec in the early 1990s. The plan to construct a giant hydro- electric facility in the province's far north would have involved flooding an area larger than the state of Rhode Island, building a series of roads and airports, and damming parts of twenty rivers.
Quebec's provincial government halted the project in 1995 after intense lobbying by Cree and environmentalists.
Unhappy with these comments, Hydro-Quebec's Acting Executive Director Bob Walker issued a written statement in defense of the provincial utility. He stressed Hydro-Quebec's exemplary aboriginal relations record, maintaining the provincial utility's efforts to work with native communities.
"Hydro-Quebec has always been a pioneer in the matter of relations with Aboriginal peoples," summarized Walker, "(we have) an ongoing relationship with the Aboriginal peoples of Quebec."
Along with the Social Investment Profile, the SIO published a Focus Report, a primer on Canada's electricity utility industry, and a National Roundtable Report.
Anyone interested in obtaining a copy of the report should contact the SIO at 416-360-6047, or E-mail them at: sio@web.apc.org.