Canada: Corporate Directors and Officers Can Be Culpable for Environmental Harm

Mondaq (05/10/10); McAree, Marc
Statutes and regulations involving the environment are increasingly being passed at the federal, provincial, and local levels of government. Such laws can affect requirements for corporate directors and officers, such as environmental offences for causing pollution; failing to report discharges and spills; non-compliance with orders, approvals, and permits; obstructing the regulator; and providing the regulator with false information. Regulators typically concentrate on the acts and omissions of the corporation, while compliance usually involves regulatory abatement investigation and enforcement. The Canadian Environmental Protection Act of 1999 mandates that if “a corporation commits an offence under this Act or the regulations, any officer, director, or agent of the corporation who directed, authorized, assented to, acquiescenced in, or participated in the commission of the offence is a party to and guilty of the offence, and is liable to the punishment provided for the offence, whether or not the corporation has been prosecuted or convicted.” Similar language can be found in certain provincial environmental laws. This statutory language imposes a positive obligation on directors and officers to act to ensure corporate compliance with environmental laws. To position themselves, directors and officers usually need guidance from corporate counsel to implement appropriate safeguards before an environmental event occurs. This includes structuring and implementing a corporate environmental policy and environmental management system.

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