by Rossland Telegraph on Thursday December 10 2009
Last week, Teck was sentenced to pay a grand total of $115 000 in fines after being found guilty of negligence after the corporation dumped over 800 kilograms of electrolyte into the Columbia River earlier this year.
To you or I, $115 000 looks like a fairly substantial sum. Certainly, if I had 800 kilograms of electrolyte in the trunk of my Toyota, I'd think twice before dumping it into the river if I thought I might be faced with a fine of that size. So far so good. In my case or yours, the incentive would be compelling: make a mess and lose my house.
But what about Teck?
Even though corporations are, legally, 'persons' Teck is a very different person from you or I. First off, Teck is a very rich person. After posting record revenues of $2.1 billion during the third quarter of this year, Teck appears on track to earning over $7 billion in revenues in 2009.
Now, let's do some math. A fine of $115 000 works out to be 0.0000164% of Teck's total projected income for 2009. I tried doing this calculation on my son's calculator, but it kept giving the answer as “0.0”, so I had to search out a scientific calculator capable of handling such tiny figures.
What does this fine mean in reality?
Well, the average Canadian family enjoys revenues of around $54 000 per year. An equivalent fine for, let's say, dumping a gallon of paint thinner into a storm drain, would work out to around 88 cents. A deterrent? A motivator to take that thinner down to the recycling centre in Trail? Nope. Not even close.
Let's leave aside the fact that Teck, through the miracle of 'creative sentencing' is being allowed to pay its fine to two charities it already supports (looking good in the process). Let's leave aside the possibility that this fine might prove to be tax deductible. Instead, let's focus on justice.
In handing down her judgment last week, Judge Lisa Mroznski noted that there was clear negligence and that our region's largest corporate citizen, “committed” though its PR material claims it is to being environmentally responsible, lacked properly-trained staff and a decent back up plan.
So where is the justice? What is to stop this sort of thing from happening again? The equivalent of an 88 cent fine? The judge's expressed hopes that the corporation won't continue to “lurch from disaster to disaster”? Or nothing?
Perhaps we should count on the “remorse” that Judge Mroznski said went into her calculation of the damages. Or not. One can't really blame Teck and their lawyers for this. They work for corporations that are programmed to minimize expenses and maximize profits. Why wouldn't they seek 'creative sentencing' if the law allows it? While individuals who work for Teck may feel genuine remorse at systemic failures like this, the corporation itself can't: it's a machine designed to make money.
I don't even blame Teck in this situation. Instead, I blame our government and legal system.
The Canadian public relies on its public institutions to monitor companies like Teck and penalize them when they screw up. Too bad they aren't doing their jobs.
Why aren't corporate fines in line with corporate revenues? $115 000 sounds like a decent amount of money until one looks a little more closely. In reality, to a behemoth like Teck, it's a joke. Why not set fines based on percentages of revenues? If Teck knew in advance it would be penalized 1% of its annual revenues for ($70 000 000) for such a spill, you can bet its safety systems would be well-designed and well-monitored by well-trained staff. The equivalent fine for the average Canadian would be around $500, which sounds reasonable.
But the current situation is far from reasonable. Where is the accountability that will stop this sort of thing from happening again?
As it stands, the situation is a disgrace.
