New report says investors in Canadian mining companies are harmed by lack of information [press release]
Securities regulators are turning a blind eye to violence and lack of Indigenous consent around Canadian mines. 15 Sept 2020.
...A new study shows that share prices take a hit when investors are informed about violence or lack of Indigenous consent in extractive projects. Between 2012 and 2019, the Justice and Corporate Accountability Project (JCAP) filed six complaints to securities regulators in Canada and the United States alleging that Canadian mining companies failed to disclose key information about conflict at their mines. The projects were in Mexico, Guatemala and Alaska. When JCAP made the information public, share prices dropped from 11%- 33% in a matter of days.
Four of the six complaints were about the same company, Tahoe Resources...covering the ongoing opposition to Tahoe’s mine by the community and the Xinca Indigenous people. Tahoe did not disclose this information to its shareholders. Instead, Tahoe executives boasted that the “people love us” even after Tahoe security guards shot farmers in the back as they fled a peaceful protest..... Tahoe’s stock began its fall from $16.74 USD when JCAP published its first complaint in 2012.... In spite of the repeated complaints, securities regulators did not require Tahoe to disclose information about community opposition. Shareholders have brought class action lawsuits against Tahoe to recover losses...
“Securities regulators should explain why they are turning a blind eye to community conflict and lack of Indigenous consent,” said Shin Imai [author], Professor Emeritus at Osgoode Hall Law School. “In the case of Tahoe, we don’t even know if the British Columbia Securities Commission bothered to contact the company.”...
JCAP’s report recommends more explicit guidance for extractive companies to disclose violence and lack of Indigenous consent, and that securities regulators need to enforce disclosure requirements...