Professor Hassan Ahmad is undertaking this two-year SSHRC-funded project to identify the doctrinal and conceptual challenges and opportunities that arise from nascent and even novel types of domestic and transnational harm caused by Canadian corporations. The project aims to provide a foundation for a judicially-based framework of corporate liability for harms incurred as a result of climate change, artificial intelligence (AI), and social media. With Canadian corporations exerting unmitigated effects on people and the environment, this relatively more realistic manifestation of corporate liability stands the chance to improve the health and well-being of Canadians and those who interact with Canadian corporations abroad.
The project will be underpinned by the following three research objectives:
- To examine the separation of powers with respect to corporate liability, assessing the degree to which there should be a principled separation that does not relegate courts to mere arbiters of a particular dispute.
- To reformulate the law of corporate purpose to oblige corporations to account for stakeholder impacts in their decision-making.
- To provide an analytical framework for novel interpretations of tort law by synthesizing and integrating recent theories around how to redress harms associated with public nuisance, infliction of mental suffering, or negligence.
Companies in the oil and mining, technology, and social media sectors exert far-reaching impacts on the physical, mental and emotional health of individuals, as well as on their environments and communities. In recent years, several cases have been initiated against companies in these sectors. Claimants have alleged physical, emotional, and/or environmental harms caused by corporate operations or the products that result from those operations. Investigative reports and corporate disclosure documents have further revealed that multinational corporations (MNCs) operating in the oil and mining sector have been complicit in or directly responsible for severe human rights violations. Legislative efforts to regulate domestic and transnational corporate misconduct remain limited. And corporate lobbying has undermined meaningful reform from the political branches of government.
At times, courts have been reluctant to intervene on policy-laden matters that implicate corporate misconduct—particularly when it concerns powerful MNCs that operate in other parts of the world. That is why this project will explore a principled separation of powers that acknowledges the judiciary’s potential role in enforcing corporate accountability. It will consider opportunities for the judiciary to fill legislative gaps and advance the common law in a way that aligns with the factual realities of corporate interaction with third party stakeholders. In this vein, this project will consider if and how courts can develop and apply, for instance, tort law, corporate law, and even international law doctrines such that claimants can pursue compensation when loss occurs from climate-, social media-, and AI-related harms. The three case studies were chosen because they involve an analogous cast of actors (corporations, shareholders, directors, officers, injured third parties, governments, and courts) and thus attract the same or similar doctrines. They also cover a panoply of corporate-related harms including, but not limited to, physical, emotional, psychological, mental, and environmental harms.
The project will unfold in two main phases aiming to reach both academic and non-academic audiences. Phase 1 of the project will consist of theoretical research into the political economy of corporate liability in industries that have tended to result in social, emotional, and environmental harms to third parties. It will explore the power dynamics among governments, corporations, courts and third-party victims in order to ascertain why certain doctrines and principles remain ill-suited to provide redress for third-party victims of corporate misconduct.
Phase 2 of the project will apply the theoretical and conceptual understandings from Phase 1 to the three above-noted case studies. Student research assistants will conduct in-depth reviews of case law, legislation, government and NGO reports, corporate disclosures, and financial statements to contextualize Canada’s government-corporate relationship in the three areas of inquiry and assess the practical implications of corporate decision-making on third parties. From that research, the project will outline legal principles that courts can utilize to advance current understandings of, for instance, public nuisance, intentional inflection of mental suffering, and negligence.
In the second phase of the project, Professor Ahmad will also argue for a more expansive iteration of corporate purpose under Canadian law. Since the Supreme Court of Canada’s decisions in BCE and Peoples, and the subsequent legislative amendments to Canada’s Business Corporations Act that surmised corporate purpose as being more than just the maximization of shareholder wealth, corporate law with respect to stakeholder harms has been in flux. In theory, corporations must consider their impacts on consumers, workers, the environment, and other third-party stakeholders. However, they are not subject to financial consequences for maintaining the traditional notion that corporate purpose prioritizes shareholder value.
This project will appeal to a range of stakeholders in Canada and other jurisdictions, including advocates and academics who are committed to creating more effective legal mechanisms for holding corporations accountable. By offering doctrinal, theoretical and practical interventions, the project will help courts and legislatures to reimagine corporate liability frameworks that are attuned to the realities of the 21st century. It will contribute significantly our understanding of corporate liability by re-envisioning the role of courts in redressing widespread and systemic harms that persist, in part, due to governmental inaction.