Protest upstages good news for Goldcorp investors

By 
  • May 22, 2008

{mosimage}TORONTO - Protesters lined the street outside Toronto’s King Edward Hotel May 20, and dominated the microphones inside Goldcorp Inc.’s annual general meeting, putting the world’s second largest gold producer on the defensive over its human rights and environmental record in Guatemala and Honduras.

Goldcorp chief executive officer Kevin McArthur reported to shareholders that the company is debt free with $1.3 billion in the bank and $1 billion a year in cash flow. But the positive financial news got far less time at the AGM than allegations from visiting Guatemalans and non-governmental organizations that the Marlin Mine in Guatemala and the San Martin Mine in Honduras are robbing local farmers of the water they need to make a living and causing health problems among local residents who must drink water laced with heavy metals.

Fausto Valiente, an agronomist representing the diocese of San Marcos, Guatemala, took the floor with allegations that blasting from the mine had damaged 87 homes in the region, ground water has dangerous levels of copper, iron, aluminium and arsenic and that the will of 18 surrounding indigenous communities who voted in a 2005 plebiscite against continued operation of the mine has been ignored.

McArthur countered that repeated and continuing independent studies of the water supply had failed to show heavy metals in the water, the company has worked with local residents on development projects including schools and clinics and that the company has engaged with local groups to produce an independent human rights impact assessment over the coming year.

“What is the price of life as opposed to the cost of gold?” asked Valiente.

Last month Vancouver-based Goldcorp lost its listing on the Jantzi Social Index of Canadian stocks over environmental and human rights issues at the company’s Central American mines. The company has become a focus for the Canadian Catholic Organization for Development and Peace’s mining campaign, which recently delivered 190,000 post cards to Parliament Hill demanding the federal government impose Canadian environmental and corporate social responsibility standards on the overseas mining operations of Canadian companies.

“We’re already getting support from the church in Canada and we hope they will continue to support us in our work, particularly in respect to getting information out,” Valiente told The Catholic Register.

Protesting outside Goldcorp’s corporate meeting was important for Paula Calderon, an elementary school teacher and member of the Catholic Women’s League of St. Joseph’s parish in Mississauga.

“It’s meaningful because I’m taking an active role in my values,” she said.

The company’s financial and mining goals are inseparable from its social responsibility goals, said McArthur. In addition to increasing it’s 2.3 million ounces of gold production in 2007 by 54 per cent over the next five years, the company is adopting the Global Reporting Initiative standards for future environmental sustainability reporting. It maintains a “buy Guatemalan” policy at the Marlin Mine. It has loaned approximately $500,000 to 600 local people in microloans through its Fundacion Sierra Madre to encourage economic diversification.

At the San Martin Mine in Honduras production has ceased and the company is backfilling the Palo Alto pit and reclaiming the land for agriculture. It will eventually cede the land to the San Martin Foundation which will operate commercial agricultural projects with local farmers.

Among major shareholders in Goldcorp are the Canada Pension Plan Investment Board, the British Columbia Investment Board, OMERS, the retirement fund of Ontario’s municipal employees, and the Ontario Teachers’ Pension Plan Board.

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