Export Development Canada (EDC) Financial Services – Corporate Social Responsibility Requirements Yolanda Banks Senior Corporate Social Responsibility Advisor Presented to Canada-South Africa Chamber of Business and MineAfrica Seminar, Toronto 22 October 2009

Our mandate: Created in 1944, EDC is a Crown corporation that operates on commercial principles. Our mandate is to provide trade finance services to support Canadian exporters and investors in some 200 markets, 130 of which are in developing markets. Role of Export Development Canada (EDC)

Role of EDC (cont’d) ** indicates products most used in Africa Our Basic Products and Services:  Credit Insurance  Medium- and Long-Term Financing – including Project Finance **  Bonding  Political Risk Insurance *** - including non- honouring sovereign PRI  Equity

4 EDC Business Volumes – support for business in Sub- Saharan Africa 2009 (August YTD) Contract Insurance and Bonding (CIB) 46,515,50058,133,665115,218,871 Financing (FIN) 165,843,28353,927,613355,580,739 Political Risk Insurance (PRI) 564,211,411517,350,4431,011,017,082 Short-term Credit Insurance (STI) 187,182,084335,050,573112,300,371 TOTAL 963,752,278964,462,2941,594,117,064

Recent Sub-Saharan Africa - Project Finance Deals Ambatovy Nickel Mine, Sherritt International (Madagascar) The Ambatovy nickel and cobalt mine in Madagascar is expected to employ 1,900 Malagasy workers during construction and 1,600 during operation. Photos courtesy Sherritt International Corporation

Recent Sub-Saharan Africa - Project Finance Deals Lumwana Copper Project, Equinox Minerals (Zambia) As part of a Category A environmental review, members of EDC’s Environmental Advisory Services group conducted a site visit of the Lumwana Copper mine in Zambia in March Photo courtesy Equinox Minerals

Recent Sub-Saharan Africa - Other Financing 2009 South Africa Nedbank Ltd. Financing Sale of Telecommunication Equipment and Services $ million in favour of Ericsson Canada Inc. + other exporters 2008 Tanzania MIC Tanzania Limited Financing Telecommunications equipment and related services $15-25 million in favour of Ericsson Canada Inc Zambia Développement International Desjardins Inc. Financing Support of foreign direct investment (FDI) $< 1 million

Recent Sub-Saharan Africa – Bank Guarantees 2008 Mauritania Caisse Desjardins du Marigot de Laval Guarantee for Sale of various Canadian goods and services $ < 1 million Flexexportation Inc Congo (Kinshasa) La Banque Royale du Canada Guarantee for Sale of school manuals $< 1 million Beauchemin International Inc Ethiopia Bank of Montreal Guarantee for Sale of engineering services $< 1 million Hydrosult Inc.

EDC’s CSR Statement of Commitment At EDC we commit to carry out our mandate in a socially responsible manner consistent with our corporate values.

Our Commitments CSR is an operating principle at EDC Reflects HOW we execute our mandate EDC

EDC: key elements 1.Combating Corruption 2.Environmental Review 3.Transparency 4.Human Rights Analysis How CSR Impacts EDC Customers

1. What you need to know -- Combatting corruption  Customer declarations  Awareness-raising  Documentary safeguards  Due diligence  Remedial actions Concerted action: OECD Export Credit Group

2. What you need to know -- Environmental (and Social) Review We assess the environmental impacts of all business transactions International Agreements: OECD + Equator Principles, (joining the five largest Canadian banks -- representing 80%+ of the world’s project finance market), EDC’s Environmental Review Directive (ERD) Use international standards, e.g. IFC’s Performance Standards for Social and Environmental Sustainability, World Bank’s Safeguard Policies Environmental Policy

2. Environmental (and Social) Review (cont’d) For Non-Project Transactions:  Risk Assessment, including environmental, social and reputational risk  Using publicly available sources of environmental and social information, e.g. SEC filings, compliance records, CSR / Sustainability reports, indices (Dow Jones Sustainability Index, Jantzi Social Index)  Team of specialists: environmental / social and reputation risk

Environmental (and Social) Review (cont’d) For Projects (Due Diligence Requirements):  Documentation  Comprehensive Environment and Social Impact Assessment (ESIA) -- including Stakeholder Engagement Strategies, social risks: labour & working conditions  Environment and Social Management Action Plan  Resettlement Action Plan  Biodiversity Action Plan  Site visit by EDC Specialists  Independent expert review  EDC disclosure  Environmental covenants  Ongoing monitoring

Disclosure of Information ● Commitment to transparency: “At EDC, we strive for balance between public accountability and respect for customer confidentiality” ● Disclosure Policy that governs release of customer information ● Federal Access to Information Act with protection of commercially confidential information Transparency 3. What you need to know -- Transparency

Disclosure on Category ‘A’ Projects: ex-ante and ex-post (before & after signing)

Disclosure on Category ‘B’ Projects: ex post (after signing)

Disclosure on All Financing Support: ex post (after signing)

4. What you need to know -- Human Rights Analysis “EDC values human rights and promotes the protection of internationally recognized human rights, consistent with the policies of the Government of Canada.” Source: EDC Code of Business Ethics  Statement on Human Rights, April 2008  Analysis conducted by Political Risk Assessment Department (PRAD)  Project analysis: two-way impacts -- on the project and of the project on the human rights situation  Information sources: DFAIT reports, other sources of intelligence

4. Human Rights Analysis (cont’d)  What we are looking for from customers:  Largely, although not exclusively, affects extractive companies  Looking for: – a heightened awareness of the issues, demonstrated sensitivity to how human rights impacts the project and how the project impacts the local human rights situation –Reference to application of the Voluntary Principles on Human Rights and Security -- part of EIA under IFC Performance Standard #4: Health, Safety & Security  Emerging best practice: Human Rights Impact Assessments  We can be helpful to you

Conclusion CSR = Risk Mitigant

Contact Information International Business Development Africa, Europe and Middle East Patricia Bentolila, Chief Representative – Africa and Middle East Tel: (613) Fax: (613) Anne-Marie Gagnon, Regional Manager – Africa and Middle East Maghreb and West Africa Tel: (613) Fax: (613)

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