The Need for Human Rights Accountability in Stock Markets:
The Toronto Stock Exchange and the TSX Venture Exchange
Toronto Stock Exchange
(TSX) and the TSX Venture Exchange (TSX-V) provide access to
billions of dollars in financing to mining companies every year (click for more).
- In 2007 alone, mining companies raised $17.6 billion on the TSX and TSX-V, representing 35% of the total world equity capital raised for mining. 
- In 2007, over 79 billion mining shares, valued at almost a half a trillion dollars, traded on the TSX and TSX-V. 
- In 2008, 55% of the world’s public mining companies were listed on either the TSX or the TSX-V. 
- The TSX and the TSX-V are the sole source of operating capital for many junior mining exploration companies. 
- The TSX and the TSX-V are owned by TMX Inc., a for-profit company that makes money by, among other things, charging companies to list on its stock markets.
- In 2008, TMX Inc. made $152.8 million from its listing services. 
of the money raised on
the TSX and TSX-V is used to fund projects located in “high risk”
places in the developing world where protections for human rights and
the environment are weak or entirely absent (click for more).
- TSX and TSX-V listed companies operate in countries known for severe problems with weak governance, corruption, violence and human rights abuse including the Democratic Republic of Congo, Sudan, Burma and Zimbabwe, among others. 
- TSX and TSX-V listed mining companies have projects in 14 of the 20 least developed countries in the world;  in 15 of the 25 most corrupt nations in the world;  and in 13 of the 20 nations that are most at risk of becoming failed states. 
- The Ethical Funds Company reported in 2006 that TSX-listed companies were active in 19 countries where the risk of human rights violation is “extreme” or “high”.
- The TSX has specifically advertised its “ability to finance international projects even in high risk places”, and considers this ability to be one of its unique strengths. 
- The TSX has cited the Democratic Republic of Congo as a specific example of the sort of “high risk place”  for which the TSX is good at raising money despite the fact that the Democratic Republic of Congo struggles with weak governance, significant problems with violence and the continuation of a low intensity civil war that the United Nations has concluded is financed, in part, by international mining corporations. 
- In 2008, the TSX and TSX-V provided access to capital for 1,825 projects in various developing countries in Africa and Latin America. 
raised on the TSX and
TSX-V funds mining projects associated with allegations of human rights
environmental damage (click for more).
- All twenty-two examples of mining projects that have allegedly caused human rights and environmental harms contained in the Halifax Initiative’s non-exhaustive “Canadian Mining Map” (PDF) were funded in part by listings on the TSX or the TSX-V.
- The Toronto Star recently cited ten examples of mining projects that have caused human rights and environmental harms. All ten of these projects were funded in part by listings on the TSX or the TSX-V.
- In Junín, Ecuador, some of the over $26 million (US) raised by Copper Mesa on the TSX was used to hire private security forces, rent military helicopters, and to assault and threaten individuals opposed to mining, while very little has been spent on actual mineral exploration. These activities could not have been carried out without the financing provided through the TSX.
TSX and TSX-V are aware
that money raised through their stock exchanges funds mining projects
that could cause human rights abuse and environmental damage (click for more).
- Human rights violations and environmental damage caused by mining companies listed on the TSX and TSX-V have been widely reported in the news.
- The TSX regularly monitors internet news groups for information on TSX-listed companies and would be aware of allegations of human rights abuse and environmental damage made by various civil society organizations. 
- In the case of Copper Mesa, the TSX was informed early on about the high potential for future human rights abuse associated with Copper Mesa’s Junín project in Ecuador. For example:
- The TSX received and approved corporate documents from Copper Mesa that stated that:
- numerous allegations of “abuse and threats against anti-mining groups or individuals” had been made against the company; 
- the company had financially supported a local group that had engaged in “divisive and controversial” activities;  and
- Copper Mesa employed a former Ecuadoran Army General with a checkered past as its first director of its Community Relations and Environmental Management Department. The former General was responsible for implementing Copper Mesa’s “socialization program”, and for attempting to create public acceptance of the development of Copper Mesa’s mining projects. 
- The mayor of the local municipality in Ecuador where the mine would be located wrote a letter to the TSX requesting that Copper Mesa not be listed on the TSX. The mayor points out that human rights violations had occurred in the past and warned of the potential for future violence. 
- The TSX received letters from various individuals who expressed concern about the practices of Copper Mesa. The letters stated, among other things, that:
- Copper Mesa is engaged in a “campaign of intimidation” that includes “multiple, documented death threats”.
- “I believe that violence is inevitable in Ecuador if [Copper Mesa’s] actions do not change. Before you list [Copper Mesa] or one of its subsidiaries, I urge you to carefully question the company’s inhumane practices that would never be tolerated in the United States or Canada.”
Despite this knowledge, the
TSX and TSX-V do not apply any human rights or environmental standards
when making the decision whether or not to list a company on their
stock exchanges (click for more).
- The TSX has control over establishing the rules that govern who can list on its exchange and ultimately makes the decision determining whether a company is listed. 
- The TSX has no mechanism for dealing with human rights concerns, even if it is highly likely that listing a company will lead to human rights abuse. 
- Other stock exchanges from around the world including the Australian Securities Exchange, Bursa Malaysia, and the Shanghai Stock Exchange are taking steps to raise CSR standards amongst companies that list on their exchanges.  No such steps have been taken by the TSX and TSX-V.
Unlike the TSX and TSX-V, all
major Canadian banks and other major financial institutions require
companies to abide by social, human rights and environmental standards (click for more).
- All major Canadian banks already require all recipients of project finance to adhere to social and environmental standards contained in the Equator Principles as a contractual condition in order to receive financing.
- The International Finance Corporation, the private lending arm of the World Bank, applies Social and Environmental Standards to all of the projects it finances.
Despite a complete lack of
human rights standards on the TSX, listed companies often use their
listing on the TSX to whitewash their human rights reputations (click for more).
- A listing on the TSX gives a company credibility and legitimacy.
- The TSX advertises that added prestige is one of the main benefits of listing. 
- Copper Mesa has, on several occasions, used their listing on the Toronto Stock Exchange in order to defend against accusations of human rights abuse. For example, Copper Mesa stated in a public letter that “[a]s a public company traded on the Toronto Stock Exchange, we are committed to upholding the highest standards in the areas of transparency and anti-corruption, promotion of local sustainable development, environmental protection, and human rights.” 
 TSX Inc., Toronto Stock Exchange and TSX Venture Exchange:
A Global Resource for Capital (2008) at 11. (This presentation is no
longer available on the TSX's website)
 TSX Inc., Toronto Stock Exchange and TSX Venture Exchange: A Global Resource for Capital (2008) at 22.
 TSX Inc., A Global Resource for Capital (2009)at 15.
 Alistair MacDonald, Industry in Transition: A Profile of the North American Mining Sector (Winnipeg: International Institute for Sustainable Develepment, 2002) at p. 61.
 TMX Group Inc. 2008 Annual Report (2008) http://www.tmx.com/en/pdf/reg_filings/TMXGroup2008_AR.pdf at p. 25.
 www.infomine.com/companies-properties & United Nations Development Programme, Summary Human Development Report 2009, (New York: UNDP, 2009) complied by Klippensteins, Barristers & Solicitors, January 2010.
 www.infomine.com/companies-properties & Transparency International, Corruption Perceptions Index 2009, compiled by Klippensteins, Barrister & Solicitors, January, 2010.
 www.infomine.com/companies-properties & The Fund for Peace, Failed States Index 2009, compiled by Klippensteins, Barristers & Solicitors, January 2010.
 See e.g. TSX Inc., Toronto Stock Exchange and TSX Venture Exchange: A Global Resource for Capital (2008) p. 26.
 Final Report of the Panel of Experts on the Illegal Exploitation of Resources and Other Forms of Wealth of the Democratic Republic of Congo, UN Doc. S/2002/1146 (2002); “Stop Paying for Murder” The Economist (20 December 2008) 16 at 16; Human Rights Watch, Democratic Republic of Congo Country Summary, January 2008, online: http://hrw.org/wr2k8/pdfs/drc.pdf.
 TSX Inc., Toronto Stock Exchange and TSX Venture Exchange: A Global Resource for Capital (2008) p. 11.
 TSX Inc., TSX Company Manual, online: http://tmx.complinet.com/en/tsx_manual.html.
 Ascendant Copper Corporation, Prospectus (October 14, 2005), p. 12.
 Ibid. p. 13
 Ibid. pp. 9 & 13; see also www.ascendantcopper.com/Com_AreaMap/Community.htm (saved April 19, 2005)
 Letter from Auki Tituaña Males, Mayor of Cotacatchi Canón, Ecuador to the Finance and Audit Committee of the Toronto Stock Exchange (March 8, 2005).
 Toronto Stock Exchange Company Manual, http://tmx.complinet.com/en/tsx_manual.html
 Dan Siddy, Exchanges and Sustainable Investment, (World Federation of Exchanges, 2009), http://www.world-exchanges.org/sustainability/WFE-ESG.pdf
 See e.g. http://www.tmx.com/en/listings/listing_with_us/benefits/index.html
 See e.g. Letter from Ascendant Copper Corporation to the Business & Human Rights Resource Centre, p. 4.