Enbridge and the Northern Gateway Pipeline: Between a Rock and a Hard Place

For decades, Enbridge Incorporated has been seen as one of Canada’s foremost corporate leaders in environmental, social, and corporate governance; even during the course of this past year, the company received accolades as one of the Global 100 Most Sustainable Corporations, was ranked as the number two most sustainable business in Canada, and for the third year in a row was voted as one of Canada’s most environmentally conscious business giants. How quickly positive vibes seem to dissipate in a heart-beat in the world of big business, especially where resource extraction is concerned.

Over the past few months, Enbridge’s reputation as a progressive-minded leader and standard-bearer of the CSR movement has been challenged by contentious political and social debate that has erupted over its unwavering support of its own Northern Gateway Pipeline proposal. I previously wrote about this issue in a post on First Nations opposition to the proposal - a project that is also opposed by a wide range of social, environmental, and political lobbyists across the country. Unfortunately for Enbridge and its stakeholders, rancorous political debate and often-negative mainstream news coverage of the company’s response to concerns around the proposed pipeline have quickly blighted the company’s previously spotless record of corporate social responsibility, as a recent Jantzi Social Index publication illustrates.

What you’re probably wondering, and rightly so, is how does a simple blueprint for a pipeline earn Enbridge the wrath of so many Canadians, and so quicky? If we take the Jantzi Social Index at its word, Enbridge’s recent record is questioned due to “several recent spills”; notice that there is no mention of the tussle over its plans for the Northern Gateway Pipeline. Other sources, however, suggest that Canadians are increasingly getting fed up with the company’s insistence on pursuing an increasingly unpopular beast of a project that is fraught with environmental and social concerns. To underscore the ramifications of the quandary which has undoubtedly put a considerable dent in the reputation of the energy giant, respected BC-based credit union Vancity Investment Management sold its shares in the energy giant this past summer, citing “the pipeline company’s ‘Keystone Kops’ handling of a massive 2010 oil spill in Michigan” which “suggests it no longer meets the credit union’s criteria for socially responsible investments.”

Indeed, the Northern Gateway Pipeline – as with most, if not all major resource development projects in Canadian history – is an explosive issue that has once again pitted a Canadian government against environmental activists, native communities, and concerned parties. As a result, Enbridge now finds itself caught in a duel between energy-hungry capital investors and shareholders on one hand, and ethical investors and corporations on the other. While First Nations Assembly Chief Shawn Atleo – coming off a recent election victory which extends his stay in office for another three years – has not expressed public opposition to the Northern Gateway Pipeline yet, he did however release an Op-Ed piece in the Globe and Mail in August stating that Canada’s First Nations must be “full participants and drivers of new sustainable and responsible economic opportunity.”

If one follows the barrage of criticism against Enbridge, concerns of lackluster sustainable and responsible conduct seem to be at the forefront of the assault on the company’s Northern Gateway Pipeline plans and moreover, on its reputation. Many who oppose the NGP blueprint believe that it could be another Michigan Spill in the making, and the possibility of an environmental tragedy such as a major spill is certainly a valid concern for First Nations communities in the path of the proposed development project.

On the provincial level, Enbridge’s uncompromising support of the Northern Gateway project has also led to open political clashes between the Liberal-led British Columbian government of Premier Christy Clark which is opposed to the project, and the pro-NGP Legislative Assembly of Alberta helmed by Progressive Conservative Premier Alison Redford (who is perhaps somewhat ironically a native of Kitimat, the British Columbia port town where the Northern Gateway Pipeline would terminate).

Nevertheless, support for the construction of the pipeline is palpable amongst many observers;  Globe and Mail contributor David Berman states  that “socially conscious investors agree…pipelines are among a select group of Canadian stocks that are deemed good enough not only for amoral types, but also for investors who like to believe that their investments are being put to good use.” Case in point – the battle over the Northern Gateway Pipeline is sure to consume public discourse from all angles for the foreseeable future.