The fossil fuel industry lobbied the B.C. government more than 22,000 times between April 2010 and October 2016, according to a report released Wednesday by the Canadian Centre for Policy Alternatives as part of the Corporate Mapping Project.

The report also found that 48 fossil fuel companies and associated industry groups have donated $5.2 million to B.C. political parties between 2008 and 2015 — 92 per cent of which has gone to the BC Liberals.

The analysis found seven of the top 10 political donors from the fossil fuel industry are also B.C.’s most active lobbyists.

The Corporate Mapping Project is a six-year research and public engagement initiative jointly led by the University of Victoria, the Canadian Centre for Policy Alternatives and the Alberta-based Parkland Institute.

Researchers have painstakingly analyzed lobbying and political donation records to demonstrate the extensive political influence of the fossil fuel industry in B.C.

“I was definitely surprised at the sheer volume of lobbying contacts that we found,” Nick Graham, lead author of the report and PhD candidate at the University of Victoria, told DeSmog Canada.

Spectra Energy, Enbridge, FortisBC, Encana, Chevron Canada, CAPP and Teck Resources conducted the majority of registered lobbying contacts, more than 19,500 in total since the lobbyist registry was first initiated in 2010 — an average of 14 lobbying contacts in B.C. per day.

“We were expecting to see some overlap between political donations and lobbying,” Graham said. “Part of what donations help achieve is access to government so we certainly expected to see some of that.”

The top 10 fossil fuel industry donors were responsible for $3.8 million in contributions to the BC Liberals and $270,000 to the BC NDP.

The Corporate Mapping Project report, co-authored by Shannon Daub of the Canadian Centre for Policy Alternatives and Bill Carroll, professor of sociology at the University of Victoria, is the first systematic analysis of fossil fuel lobbying in B.C.

Top 10 fossil fuel industry donors in B.C. Source: CCPA, Corporate Mapping Project.

Clear Connection Between Lobbying, Donations and Policy Outcomes

“There is a fairly clear connection between lobbying, donations and policy outcomes that is quite troubling,” Daub told DeSmog Canada.

“It can be difficult to draw a line between a political donation or a meeting and policy because so little information is released to the public about what is going on behind closed doors,” Daub said.

But, she added, a more broad analysis like this can help connect the dots.

“We did note the Canadian Association of Petroleum Producers, for example, in a one year period between October 2015 and August 2016, reported 201 lobbying contacts with the provincial government specifically in relation to the climate leadership plan.”

“And of course that plan turned out to not be much of a plan at all,” Daub added.

The analysis found 28 per cent of lobbying by the top fossil fuel lobbyists was with cabinet ministers.

Several cabinet ministers were the frequent target of lobbying contacts, the most popular being Minister of Natural Gas Development Rich Coleman, who was listed in 733 contacts with the top 10 fossil fuel firms.

The other most contacted senior ministers are Premier Christy Clark (618 contacts), Minister of Energy and Mines Bill Bennett (437), Environment Minister Mary Polak (354) and Finance Minister Mike de Jong (330).

“It really does speak to the development of these close relationships,” Graham said. “You do see particular firms heavily targeting individuals. There is this really tight, if not cozy, ongoing relationship that develops and the perspective of the two become quite closely aligned.”

Companies such as Encana, with significant operations in B.C.’s natural gas plays focused heavily on lobbying Natural Gas Development Minister Coleman, the analysis found.

Source: CCPA, Corporate Mapping Project

Corporate Influence Far Outweighs Environmental Voices

Graham added the analysis was shaped in part by the B.C. government’s push for increased extractive industry projects in the province for nearly the last decade.

“The paper began from the perspective of seeing this really incredible push around expanding fossil fuel development in the province especially around natural gas and the really aggressive promotion of the LNG industry in particular by the government.”

“Part of our question was, ‘how can we explain this? What explains this?’ ” Graham said.

“What we found are there are multiple explanations that point to the structural power of industry and the provincial government’s reliance on resource rent. But also major corporate influence: the ability of corporations to have these stores of capital to pressure government on an ongoing basis.”

The analysis found a total of 1,300 lobby contacts between the government and environmental or non-governmental organizations during the same timeframe.

Daub said there is clearly not level access to provincial decision-makers in B.C.

“What shows really clearly from these numbers is that we have one industry with a very disproportionate level of access to government and government policy,” she said.

B.C.’s Ongoing Transparency Problem

B.C. has some of the weakest political donation rules in the country, which allow unlimited donations from individuals, foreigners, corporations and unions.

“Clearly it’s just time to ban big money in politics all together. One of the recommendations in our report is to put a stop to corporate and union donations and a cap on individual contributions.”

Federally, political parties cannot accept donations from corporations or unions and provinces like Quebec place a $100 limit on personal donations.

“It’s supposed to be one person, one vote,” Daub said. “Instead in B.C. it’s more like one dollar, one vote.”

A level democratic playing field is important for the public to have confidence in the political system but also to feel they can meaningfully participate in the process, Daub said.

Beyond problems with special interest dollars flooding the political process, B.C. also has poor transparency requirements when it comes to lobbying.

Lobbyists must register to lobby in B.C. and provide a list of intended meetings. However, there is no official record kept that distinguishes between intended and actual meetings.

Any meetings requested by public officials are not registered.

In addition, lobby records do not give the public detailed information about the content of meetings.

“Teck is one of the biggest lobbyists in the province among industry groups and they have a particular focus on MLAs,” Daub said. “But what they report they’ve lobbied on is things like ‘mining,’ or ‘employment and training’ or ‘aboriginal affairs.’ ”

“That doesn’t tell us anything about what they’re actually talking to these public officials about.”

Daub said better records should be kept of lobbying interactions that gives the public a decent account of when and how frequently these meetings are taking place and what public policy matters are at stake.

“A more transparent system would make it much easier for the public to find out what is going on in these closed door meetings.”

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Christy Clark recently turned down the opportunity to limit foreign and corporate donations to political parties in campaigns. She justified her position by simply stating, “I represent everyone.”   Yet a new poll conducted by Insights West found the vast majority of British Columbians — 86 per cent — support a ban on both corporate and union political donations.   The poll, conducted on behalf of the Dogwood Initiative, a democracy advocacy organization, suggests Clark’s cozy relationship with major foreign and corporate donors could put her in the hot seat leading into the province’s next election.   That seat is likely to be even hotter after revelations Clark takes a cut of funds donated to the B.C. Liberal party through exclusive cash-for-access events that can cost up to $20,000 dollars to attend.   A high percentage of B.C. Liberal donors, 81 per cent, and an even higher number of B.C. NDP voters, 91 per cent, support putting a ban on corporate and union donations before the next election.

B.C. has long been called the “wild west of campaign donations” because, unlike most other provinces in Canada, it has no rules to prevent unlimited, foreign, union and corporate money from pouring into elections.    It’s a problem the Dogwood Initiative would like to see remedied through its Ban Big Money campaign before British Columbians hit the polls in early 2017. The group’s recent House of Cards-esque trailer for the corrupting influence of money in B.C. elections has been viewed on Facebook over 85,000 times.

BC's House of Cash

With apologies to Netflix, here's the high-stakes drama British Columbians can't get enough of: http://BanBigMoney.ca #BanBigMoney

Posted by Dogwood Initiative on Wednesday, April 13, 2016

Kai Nagata, energy and democracy director at Dogwood, said B.C. has created a situation “that has made bribery legal.”   He said the recent spate of arrests of cabinet ministers in Quebec on corruption and fraud charges were for activities “commonplace and totally protected by law in B.C.”   Recent Elections B.C. data on 2015 political donations shows that since 2005 the B.C. Liberal party raised $70.2 million from corporate and business donors. In that same period three donors exceeded donations of one million: Encana Corporation at $1.1 million, the Aquilini Group ($1.2 million) and Teck Resources ($2.3 million).

“So you ask companies, ‘why would you donate that money to a political party?’ It’s not charity; it’s an investment because you get something back,” Nagata said.   “You get policy decidedly tilted in favour of people who are able to fund political campaigns and ordinary citizens have their voices diluted in this process.”   “You go anywhere in this province and it’s hard not to see that virtually everything is for sale,” Nagata said, listing contracts for the Site C dam, B.C.’s trophy hunting, U.S. coal exports, LNG projects and the contemptible Vancouver real estate scene.   “There are a lot of decisions by government —decisions or calculated inaction — that amount to outcomes that are against public interest.”   “In B.C. because laws are so permissive people can donate unlimited amounts of money from overseas,” Nagata said. “So you don’t even have to be from Canada to have a say in public policy in B.C.”   Dermod Travis from IntegrityBC said there are a number of issues with political donations in B.C. that cause him concern.   “The most concerning thing is that money is being donated by corporations and individuals that can’t vote in the province,” Travis said. “If you can’t check a ballot, you shouldn’t be allowed to donate funds.”   Travis said British Columbians are worried about the level of influence companies like Encana and Teck Resources are able to purchase with consistently large donations.   “With Encana you see exactly what kind of sweetheart deals people have come to expect,” he said.   Travis said the BC Liberals consistently award contracts to companies that are party donors.   “Look at the companies that Partnerships B.C. has awarded construction contracts to and you will see a direct correlation between being contracts and being a donor to the BC Liberals.”   “People don’t have enough assurance the government is protecting the public’s interest, rather than corporate interests,” he said.   Travis also criticized the data publicly released by Elections B.C., saying the documents aren’t easily searchable which creates convenient loopholes for individuals who want to mask their donations.   “There are little tricks that get played in the process,” Travis said. “I’ll use my own name as an example: if you were to use the Elections B.C. database and search Dermod Travis any donations I made as Dermod J. Travis would not show up and that’s a problem.”   Both individuals and companies take advantage of this “initial game,” Travis said, “you might be left with the impression it was done deliberately so you couldn’t find their donations.”   He said an outright ban on corporate donations and a strict cap on individual donations would eliminate that problem.   “I think it creates an incredible level of cynicism that’s going to take a long time to remove even with a ban on these types of donations,” Travis said.   “It creates sense that there are winners and losers and the only way to be a winner is to be a donor.”   By leaving donor rules so open, government is fostering a sense of mistrust in the public, Nagata said.   “By refusing to take action to limit corporate money in elections they are leaving the question to voters: is government making decisions on behalf of citizens and in the public interest or are those decisions informed by the amount of money donated to politicians’ campaigns by these large corporations?”   “Obviously you don’t give someone a million dollars and say do whatever you want. There’s an expectation of a quid pro quo,” Nagata said.   “Citizens can’t collectively donate that amount of money to balance that influence — all you have is your vote,” Nagata said. “People don’t even do that because they feel cynical about the whole process.”   “That’s what we see, that’s our diagnosis. It seems the solution is simple: the government could restore public trust by not taking money from these outside influences and ensure they are making decisions on behalf of those who elected them.”

For more on political donations and how they cost taxpayers money, watch Kai Nagata break it down in this video below:  

How corruption can increase your tax bill

B.C.'s weak political donation laws leave the door open to corruption. Corruption destroys democracy and costs taxpayers, too. Join the movement to #BanBigMoney in B.C. politics: www.BanBigMoney.ca

Posted by Dogwood Initiative on Wednesday, April 27, 2016

Image: Province of British Columbia/Flickr.

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By Dermod Travis, executive director of IntegrityBC.

One of the last things anyone would ever imagine the B.C. government doing is adopting an old NDP program, but that's exactly what Energy and Mines Minister Bill Bennett did this month when he announced a five-year, $300 million hydro bill deferment plan for 13 B.C. mines owned by six companies.

Never mind that BC Hydro is grappling with its own deferral problems to the tune of $5 billion.

Make no mistake, there's a price to pay when BC Hydro becomes a political arm of government. The intertwining of self-interests gets complicated, and the interests of ratepayers can take a backseat to political interests.

Three of the six companies in Bennett's deal were highlighted in a December Financial Post article, “Debt risks mount as Canada’s base metal miners sink deep in the hole.”

One could argue that the headline alone justifies Bennett's move, except there's no guarantee — other than a hope and a prayer — that BC Hydro will be repaid.

The issue of what happens if metal prices don't rebound wasn't addressed in Bennett's news release.

Consider the “dire financial position” of one of the companies: Colorado-based Thompson Creek Metals.

Last year, Deutsche Bank analyst Jorge Beristain said the company is “quickly approaching an end-game” with debts of $832 million U.S.

According to the Financial Post, Teck Resources “has more than US$3.5 billion of debt coming due between 2017 and 2023 and lost its investment-grade credit rating last year.”

Taseko Mines, “has more than $260 million of senior notes coming due in 2019, while a US$30 million secured loan matures this May.”

It seems like only yesterday that the company sent Bennett off to lobby Ottawa on its behalf.

In January 2014, Bennett spent a day on Parliament Hill meeting with Natural Resources minister Joe Oliver and Industry minister James Moore to make Taseko's case for its controversial New Prosperity copper and gold project.

By then copper prices had already fallen 27.5 per cent off their 2011 high.

Taseko is also in the midst of a messy proxy fight with Chicago-based Raging River Capital over $26 million in management fees Taseko has paid Hunter Dickinson Inc. Taseko and Hunter Dickinson share three directors in common.

Imperial Metals owns three of the 13 mines in Bennett's deal, including Mount Polley, Red Chris and Huckleberry. In 2004, the government quietly forgave $3 million in liabilities owed it by Huckleberry Mine.

Imperial Metals's controlling shareholder — Murray Edwards — has a net worth of $2.69 billion.

The BC Liberal party has done well from them.

From 2005 to 2014, the six companies donated $2.8 million to the party. Key executives kicked-in another $380,000.

Three of the six companies donated $97,010 to the NDP, $75,300 of it in 2013.

BC Hydro's contractual obligations with private power producers have ballooned from $22.25 billion in 2009 for “2010 and beyond” to $56.2 billion for “2016 and beyond.”

It's the gift that keeps on giving for everyone involved, except ratepayers.

In a 2008 call for independent power projects, 75 proponents registered with BC Hydro.

Forty-three submitted proposals and, in 2010, BC Hydro signed purchase agreements with 18 of the proponents.

From July 1, 2008 to September 30, 2010 — when B.C. Hydro was making its decisions — 14 proponents donated $268,461 to the Liberals. One donated $1,000 to the NDP.

Ten of the 14 signed purchase agreements with BC Hydro. One of the 14 who didn't, never donated again.

Their before and after donations are interesting too.

For the 10 successful proponents, their donations more than doubled from $112,801 (January 2005 to June 2008) to $229,471.

After the deals were done, they settled back again. Seven donated $112,345 to the Liberals and five gave $16,225 to the NDP (2010 to 2014).

In 2008, the Mining Association of B.C. received a $295,188 grant from the Northern Development Initiative Trust (NDIT) to make the business case for the Northwest Transmission Line.

In turn, the association hired Australia-based Macquarie Bank to “determine the threshold of economic activity that would be required to make the construction of the (line) an economically viable infrastructure project.”

NDIT's Highway 37 Power Line Coalition has 22 private sector partners.

Excluding the six companies in Bennett's deferral program, independent power producers and those identified by BC Hydro as “potential future mines” for the transmission line, three trade associations and ten of the companies donated $962,220 to the Liberals and $10,320 to the NDP.

Macquarie has donated $17,050 to the Liberals.

The $404 million transmission line overshot its budget by more than $300 million, with a final price tag of $716 million. But who counts bills among friends?

There are the nine “potential future mines” that BC Hydro hopes will one day connect to the line.

With the downturn in metal prices, BC Hydro shouldn't hold its breath in anticipation.

Excluding donations from Imperial Metals and Teck, who have interests in three of the mines, the most generous companies were Goldcorp at $795,700, the Lundin Group of Companies ($112,145) and Copper Fox Metals ($93,130).

One of the founding directors of Copper Fox Metals is Hector Mackay-Dunn, who co-chaired the BC Liberal's 2009 election preparation efforts.

MacKay-Dunn is affectionately known in some party circles as Hector the Collector for his prowess at political fundraising.

The nine companies behind the potential mines have donated $1 million to the Liberals and $18,050 to the NDP ($10,000 of it from Copper Fox in 2013).

And at the same time the government was imposing hydro rate increases on schools and hospitals in 2014, Bennett announced a $100 million BC Hydro initiative for pulp and paper producers to “support investments in more energy efficient equipment.”

The forest industry has donated more than $4.2 million to the Liberals and $294,905 to the NDP.

Tidy haul.

Add it all up: more than $9.8 million in donations from interested parties to the Liberals and $417,185 to the NDP, not including their 2015 donations.

Guess who gets saddled with the bill?

Including operating and capital development agreements that have tripled to $3.3 billion since 2010, BC Hydro's contractual obligations now stand at $59.7 billion, not including their debt which has grown from $6.8 billion in 2004 to $16.7 billion last year.

They've had to borrow $3.2 billion just to turn around and give it to the B.C. government as so-called dividends.

Meanwhile, Hydro-Quebec cut a dividend cheque of $2.5 billion for the Quebec government in 2014.

They didn't have to borrow money to cover the cheque and still had $700 million in profits left over.

In 2014, it's rates were nearly two cents per kWh lower than B.C. From 2007 to 2015, its cumulative rate increase was 17.1. In B.C., it was 63.2 per cent.

Total donations from all of Hydro-Quebec's suppliers and contractors to the Parti Quebecois and the Quebec Liberal party in the last 30-years? Zero.

Quebec bans corporate and union donations. The maximum any Quebec resident can give to a political party is $100 annually.

Image: Crusher at the Red Chris mine via Imperial Metals

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The 2014 financial reports from B.C.’s political parties are out and my face hurts from all of the eyebrow raising.

Donations to political parties from corporations are banned federally, but here in B.C. — the wild west of political donations — the corporate cash is free-flowing.

Here are the Top 5 disconcerting revelations from this year’s disclosures. (Thanks to Integrity BC for drawing my attention to many of these.)

1) Let’s start with the $40,950 that accounting firm KPMG gave to the BC Liberals in 2014. KPMG is the company BC Hydro hired to “independently review” the costs of the $8.8 billion Site C dam. The B.C. government has pointed to the KPMG report to defend its decision to ignore an expert recommendation to send the project to the B.C. Utilities Commission for review.

Since 2005, KPMG and its related companies have given $284,994 to the BC Liberals and $13,150 to the NDP.

2) In the words of IntegrityBC’s Dermod Travis “the 2014 Award for Incredibly Bad Taste in Donations goes to Imperial Metals, owners of the Mount Polley mine.”

The mining company donated $7,150 to the Liberals, including a $1,500 cheque in October and another for $250 in November, in the months following the company’s enormous Mount Polley tailings dam failure.

“The spill may have been toxic, but Imperial's cash wasn't,” Travis quipped.

3) Oil and gas transportation companies got in on the action, too, with Kinder Morgan ($4,500), TransCanada Pipelines ($5,600), Coastal GasLink Pipeline ($12,500) and Enbridge Northern Gateway ($13,450) all filling up the Liberal’s bank account.

Woodfibre LNG, which is proposing a liquefied natural gas export terminal in Howe Sound, gave $28,000 to the Liberals and $8,000 to the B.C. NDP. Woodfibre also spent more than $18,000 on newspaper and radio ads in Squamish during the November 2014 local election.

4) As the high-stakes Metro Vancouver waste debate raged on last year, BFI Canada gave the Liberals $91,300 and Belkorp Environmental Services gave $37,200.

Those companies didn’t like Metro Vancouver’s garbage plans, so they also hired lobbyists to pressure the provincial government. According to B.C.’s Office of the Registrar of Lobbyists, Belkorp hired John Les, former MLA for Chilliwack, and BFI hired lobbyist Dimitri Pantazopoulos, who was the Liberals’ chief pollster during the 2013 provincial election.

5) Perhaps the most bizarre donation of all is one for $28,750 from the Alberta Newspaper Group to the Liberals.

Alberta Newspaper Group has no papers in B.C., but is run and partially owned by British Columbian David Radler. Yes, that David Radler. The one who went to jail, along with his business partner Conrad Black, after being convicted of defrauding their company Hollinger Inc.

Alberta Newspaper Group is a subsidiary of Glacier Media, which owns the Victoria Times Colonist. Radler was named the acting publisher of the Victoria Times Colonist a year ago.

Radler also runs Continental Newspapers, which publishes the Kelowna Daily Courier and Penticton Herald.

As traditional media players face unprecedented hardships to stay alive, it’s a wonder how any newspaper company can afford to scrounge up tens of thousands of dollars to curry political favour.

Sadly, this is far from the first time a B.C. media company has donated to a political party. In 2013, Postmedia — which owns the Vancouver Sun and The Province — donated $10,000 to the BC Liberals. In 2009, Glacier Media gave $100,000 to the Liberals. And between 2006 and 2011, Black Press — which owns more than 70 community newspapers in B.C.— contributed $5,430 to the BC Liberals.

It’s exactly the kind of impropriety that would typically set the press off on a feeding frenzy — alas, the only organizations to escape the news media’s often savage scrutiny are the news media themselves.

Photo: Mary Crandall via Flickr

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Unlike the U.S., where the wellspring of cash flooding federal elections is reaching a new level of absurdity (try $5 billion), Canada has kept federal political campaigns relatively grounded by placing an outright ban on corporate donations during elections. 

Yet the influence publicly-traded corporations exercise in Canada – through lobbying, political contributions during provincial elections, think tank support, advertising and advocacy campaigns – remains hugely significant, according to a discussion paper recently released by the Shareholder Association for Research and Education (SHARE), an organization that provides investment services and research to institutional investors.

“Concern about the effect of money on politics is perennial,” Kevin Thomas, report author and director of stakeholder engagement for SHARE, writes. “Aside from the obvious concerns about the outright corruption and/or illicit expenses and bribery, there is a broader concern about the influence of private interests on the development of policy and regulation, as well as on the content and tenor of public political debate.”

The paper, Dollars, Democracy and Disclosure, argues corporations hazard a reputational risk when they pursue a political agenda or, for example, lobby for policy changes that may benefit a company while shortchanging the public.

Thomas told DeSmog Canada “there is a great deal of political activities being carried out by corporations in Canada and very little of it is disclosed.”

Where it is disclosed, Thomas explained, information on corporate political spending is often dispersed and hard to access. A lack of regulated, standardized reporting on all kinds of corporate spending means that not only are the dollar amounts left unknown, but the risk that such spending creates – from both a public and corporate governance perspective – are not fully understood, Thomas said.

“It really comes down to the question of risk, and I think that’s really where our report starts and ends.”

Corporate Political Spending Creates Risk

Thomas said political spending by corporations can create all manner of risk for investors.

“Leaving aside the public side of it – where you wonder about the influence of any one party on the political process, any party that has a lot of money…the risks we look at are to the company itself.”

Thomas said SHARE asks basic questions about the risks associated with putting money to political agendas: “Is it diverting resources and focus to matters that will make the CEO look good but actually have very little to do with creating a profitable company? Is it creating risks in terms of the types of things the company associates itself with – the party, the candidate or the issues it’s chosen to involve itself with?”

Take SHARE's survey to weigh in on Canadian Corporate Political Spending Disclosure.

Thomas said some of the most difficult and important questions have to do with the market-level, economy-wide risks corporate activity can create.

Take lobbying by corporations or trade associations against effective carbon pricing or climate legislation.

“That may seem like a good idea to that individual company, to their management that is heavily invested in oil and gas, but does it actually benefit shareholders?”

At times the express activity of shareholders and corporations can be at cross-purposes, he said.

And the issue of fossil fuel industry influence is significant in Canada, where the majority of the nearly 1000 lobbyists for TSX60 companies are registered to lobby on behalf of the oil and gas industry.

This infographic from the discussion paper details the lack of disclosure of corporate political influence in Canada. From Dollars, Democracy and Disclosure.

Counter-climate Lobby May Disadvantage Shareholders

Thomas pointed to coalitions of shareholders demanding more climate accountability. In September, investors worth a combined $24 trillion signed a joint letter calling on governments to take action on climate change and price carbon effectively.

“At the same time,” Thomas said, “the companies they’re invested in are doing the exact opposite – don’t price carbon, don’t regulate our activities. There’s a real disconnect there.”

“If investors see climate change as a real risk to their own long-term interests then there’s a disconnect with what the companies and the trade associations are doing here.”

Thomas also pointed to the fact that in the lead up to the United Nations Framework Convention on Climate Change (UNFCCC) in December, UN Climate Secretary of Christiana Figueres asked attendees at a Principles for Responsible Investing conference to actively fight those who lobby against strong climate policies.

“Help me to scrub the lobbying practices,” Figueres said.

“Even if you individually are not lobbying against ambitious climate policy in the jurisdictions within which you are present, I wouldn’t guarantee that your associations, your networks, everything that is under your influence is doing the same. I ask you to commit to finding out whether everyone who is under your sphere of influence is at least being neutral on climate policy – but it is in all our interests they are lobbying for a climate policy.”

Canada's Long History of Corporate Political Influence

Thomas said public concerns over the influence of corporate money goes all the way back to Canada's first political scandal around the time of confederation.

“There was a whole scandal that forced our Prime Minister (John A. Macdonald) to resign because of money he received from Canadian Pacific Rail. So we’ve got a lot of history with this and it’s embedded in concern that democracy is harmed when any one party can drown out the voices of others.”

More recently the bungled relationship between TransCanada, the proponent of the Energy East pipeline, and Edelman, a public relations firm, demonstrates how reputational hazards can occur when a company endeavours to influence public opinion.

While in the public sphere thare are some methods of demanding accountability when it comes to the exercise of corporate influence, big gaps still exist, he said.

“A lot of provinces don’t have lobbyist registries, they don’t make that information available to the public. Or they allow corporate donations to political party leadership campaigns but don’t also require that those donations be made public. Those are some gaps in our public regulation that need to be dealt with.”

But when it comes to corporations, Thomas said, the accountability gaps are much more pronounced.

“What we found even more so was an incredible gap in corporate governance where there is no common understanding of what needs to be disclosed in that area to shareholders, and there are no regulations affecting it.”

As the SHARE discussion paper outlines, there are no basic disclosure requirements for corporations spending to influence the political and legislative process.

For the most part, shareholders have no way of knowing the extent to which companies are spending to influence these processes and to what extent shares have been put at risk in doing so.  

“So in a sense this is a very opaque area for investors and that’s where we come in: we want to have a discussion on what should be disclosed,” Thomas said.

“What are the limits that we as shareholders can put on activity which doesn’t really contribute to either a solid democracy or the profitability of the companies we’re invested in.”

Image Credit: David Gorbould via Flickr

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Imagine having to read through 10,000 written comments on the same topic. It would probably be a touch on the tedious side — yet that’s exactly what a task force did back in 2010 before issuing 31 recommendations to reform our province’s municipal elections.

The task force included three Liberal MLAs and four elected officials from towns and cities across British Columbia.

What was the most egregious problem they found during their investigation? Campaign finance rules.

In a nutshell, local elections in B.C. have been the Wild West of campaign finance — with candidates allowed to take donations from anyone and spend as much as they like.

Third parties, such as business groups, have also been allowed to drop unlimited wads of cash during elections and, worse, they haven’t even had to register or disclose how much they spend.

Since B.C.’s local election laws were way out of date (campaign spending limits have been in place at the federal level since 1974 and at the provincial level since 1995), the plan was for the task force’s recommendations to be implemented in time for the 2011 local government elections.

“The task force strongly believes that if implemented these recommendations would make a positive difference to local elections in British Columbia,” the report read.

Well, surprise, surprise — the recommendations weren’t implemented in time for the 2011 elections after all.

And in those elections, Vancouver businessman Rob Macdonald infamously cut a cheque for $960,000 to the Non-Partisan Association. In many other Canadian cities, donations of this size aren't allowed. (In Montreal, the annual cap is $300, in Toronto it’s $2,500, in Winnipeg it’s $750 and in Calgary it’s $5,000.)

Fast-forward three years to last week, and Bill 20, the Local Elections Campaign Financing Act, was passed in the legislature.

When introducing the bill, Coralee Oakes, the province’s community, sport and cultural development minister, hailed it as “the most significant update to B.C.’s local elections process in 20 years.”

The new act will require third-party advertisers to register with Elections BC, identify donors of $50 and more and report expenditures for the first time. It will also require all election advertising to clearly name a sponsor (read that again: up until now, local election ads didn’t even need to say who paid for them).

These are all steps in the right direction — but guess what’s missing?

Yup, candidates and third parties can still spend as much as they please. What is the province’s rationale for delaying the implementation of spending limits until at least 2018 — seven years after they were supposed to have been implemented?

The government claims its two-phase approach to implementing the reforms is to “allow campaign participants to become familiar with the first set of changes before adding expense limits into local elections.”

And then the province promises yet more “engagement” with “key stakeholders” on the issue. Come again?

What was the point of creating a task force that met several times and reviewed 10,000 comments before issuing its recommendations? Not only that, but the recommendations were reached by consensus of all task force members — which included B.C. Liberal cabinet minister Bill Bennett and two other B.C. Liberal MLAs.

The recommendation on expense limits was clear: “The task force believes that expense limits could increase accessibility and fairness by levelling the playing field among candidates; encouraging candidate participation; and reducing the need for large contributions to fund expensive campaigns.”

Why the province would delay on a piece of legislation that has near-unanimous support in B.C. is anyone's guess. University of Victoria political scientist Norman Ruff told DeSmog Canada one possible explanation “is that the municipal scene has become a farm team for the BC Liberals and they might not be too anxious to disturb any advantages currently enjoyed by potentially future provincial Liberal candidates.”

Robert Hobson, a Kelowna city councillor who was on the task force, called the continued delay in introducing spending limits “unfortunate.”

“It’s going to be 2018, seven years later,” Hobson said. “If the recommendations were worth putting in place, I would have thought they were worth putting in place sooner rather than later.”

Hear, hear. In the absence of spending limits, candidates and third parties — including oil pipeline companies such as Enbridge and Kinder Morgan — can spend unlimited amounts of money in this November's municipal elections.

Perhaps in a sign of what's to come, during the recent Kitimat plebiscite Enbridge reported spending at least $22,000, or about $4.50 per eligible voter — 30 times as much as the company could have spent per capita in the riding during a provincial election. (The spending was no biggie to Enbridge, which earned $1.2 billion in 2013, and also didn't seem to help them all that much with 58 per cent of voters rejecting the company's oil pipeline project.)

Still, given Enbridge’s spending in Kitimat, it’s not difficult to imagine how a lack of spending limits could undermine November’s local votes — particularly as British Columbia comes under unprecedented pressure from resource companies, many of them likely keen to dethrone local politicians opposed to their plans.

With no spending limits in sight, British Columbians' best bet is to watch like hawks this fall and make sure corporate advertising backfires — just like it did in Kitimat. It turns out most folks don't like the idea of big bucks swaying the outcome of local votes … it's just too bad the B.C. government doesn't appear to agree.

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Amid controversy about Enbridge’s spending in Kitimat before a plebiscite on its Northern Gateway oil proposal, the B.C. government introduced legislation on Wednesday that, if passed, will tighten rules for campaign financing and advertising in local government elections and referendums — but the changes come four years late and don't go far enough, says a campaign finance expert.

The new Local Elections Campaign Financing Act and Local Elections Statutes Amendment Act will require third-party advertisers to register with Elections BC, identify donors of $50 and more and report expenditures for the first time. It will also require all election advertising to clearly name a sponsor and will ensure all campaign donations and expenses are published on the Elections BC website. It will also extend the terms of office for local elected officials from three years to four.

“This is the most significant update to B.C.’s local elections process in 20 years,” Coralee Oakes, the province’s community, sport and cultural development minister, said in a statement.

However, the legislation still won’t mandate spending limits for candidates and third parties — a recommendation made by a joint B.C.-Union of B.C. Municipalities local government elections task force in 2010. The government says expense limits will be broached in a second phase of legislation before the next local election in 2018.

The task force, which reviewed more than 10,000 submissions from groups and individuals, said in its report that the intent was for its recommendations to be put in place for the 2011 local elections.

"One task force, one white paper, four years of procrastination, and the elephant is still in the room,” said Dermod Travis of Integrity BC, a non-profit that advocates for electoral finance reform.

In a submission to the province on elections reform, Integrity BC stressed the importance of implementing spending limits sooner rather than later:

The opportunity to fix a broken system, to increase accessibility to public office and to strengthen local democracy should not be lost in this process, even if it is only for one more cycle of local elections. Without meaningful electoral finance reform that includes strict election spending and contribution limits, candidacy for local government will — by and large — remain the purview of the affluent and well-connected and the public's faith in local government will continue to diminish.

The task force had clearly called for expense limits to be implemented. Its report said:

The task force believes that expense limits could increase accessibility and fairness by levelling the playing field among candidates; encouraging candidate participation; and reducing the need for large contributions to fund expensive campaigns … applying limits to third parties is important to ensuring that third party advertising cannot be used to work around restrictions on campaign spending (and accordingly, transparency).

Expressing further concerns about the impact of third-party advertisers, the report said:

Third party advertisers can have a significant impact on democratic debate in a community, but the current rules do not provide sufficient clarity on obligations of third party advertisers.

More than 1,660 elected positions on more than 250 government bodies are filled through local elections in B.C. The next local elections will be held on Nov. 15, 2014.

In the 2011 election, the largest donation was $960,000 from Vancouver businessman Rob Macdonald to the NPA. In many other Canadian cities, donations of this size aren't allowed — in Montreal, the annual cap is $300, in Toronto it’s $2,500, in Winnipeg it’s $750 and in Calgary it’s $5,000.

According to a 2010 public opinion survey conducted by the Mustel Group and commissioned by then SFU professor Kennedy Stewart, 74.5 per cent of respondents felt there should be a limit on how much any one person can donate to a local election campaign and two-thirds supported a ban on corporate and union donations.

Even if the new legislation was in affect now, the Kitimat plebiscite as structured wouldn’t fall under the new rules (a plebiscite is non-binding) — but a vote on a local bylaw or a referendum on a regional district service would. As it stands, Enbridge won't have to disclose its expenditures, which are likely to exceed $20,000 — six times what the company would be allowed to spend during a provincial vote.

Campaign spending limits for candidates and political parties have been in place at the federal level since 1974 and at the provincial level since 1995 — but it looks as though B.C.’s local elections and referendums will roll on without them until at least 2018.

Photo by Pete via Flickr

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