The Association of Home…

The Association of Home Appliance Manufacturers (AHAM) appreciates the opportunity to submit comments to the Government of Ontario with respect to the Proposed Operating Agreement Between the Minister of Environment and Climate Change and the Resource Productivity and Recovery Authority (hereinafter the Agreement). The Association of Home Appliance Manufacturers (AHAM) represents manufacturers of major, portable and floor care home appliances, and suppliers to the industry. AHAM’s more than 150 members employ thousands of people in Canada and produce more than 95% of the household appliances shipped for sale within Canada. The home appliance industry, through its products and innovation, is essential to consumer lifestyle, health, safety and convenience. Through its technology, employees and productivity, the industry contributes significantly to jobs and economic security. Home appliances are also a success story in terms of energy efficiency and environmental protection. New appliances often represent the most effective choice a consumer can make to reduce home energy use and costs. AHAM respectfully submits the following comments regarding the Agreement and welcomes the opportunity to further discuss recommended enhancements to the Agreement. Enhancing Participation of Stakeholders AHAM supports the efforts for transparency and public consultation that have been set out in the agreement; however, there are some additional areas where greater transparency, consultation and consideration of stakeholder perspectives should be included within the Agreement. The agreement indicates that the Authority shall be efficient and economical. Integral to this is understanding the impact of costs on the entities funding the authority (i.e. brand holders). This cannot be achieved without formal recognition that brand holders’ interests must be taken into account when decisions are made. The Board cannot carry out its mandate effectively if the perspectives of brand holders are not formally connected to the board’s decision making process. AHAM strongly recommends that “brand holder management” be listed under section 7.1 (b) of the agreement as a requirement for experience/expertise of the Board; and that the Agreement also include a requirement for the Authority to create an Industry Stakeholder Advisory Committee. The Industry Stakeholder Advisory Committee should have representatives from each category of brand holders of designated products and any other entities funding the Authority. This Committee should have a direct line of report to the Board, and should either include Board members as observers on the Committee or Committee representatives as observers to the Board to ensure that issues of importance to stakeholders are not overlooked. In carrying out its objectives, the Authority should be required to take into account the interests of industry stakeholders who will be funding the Authority’s operations and activities. AHAM’s recommendations for more direct and formal stakeholder involvement in the governance of the Authority is aligned with best governance practices of other public-purpose type organizations that have non-government funding. For example, the governance arrangements for NAV Canada, Toronto Port Authority and Payments Canada each have formal mechanisms for direct user/industry involvement in their respective governance structures. Improving Openness & Transparency In addition to the above governance recommendations, AHAM proposes the following enhancements to the Agreement in order to further promote openness and transparency: • As set out in sub-section 6.2 (e) of the agreement, the Authority is responsible for developing and maintaining written policies and procedures regarding compliance, enforcement and Registry maintenance. To the extent possible, this information should be understood or made available to affected industry stakeholders such as brand holders. • Sub-section 9.1(b) requires the Authority to make each business plan available to the public on the Registry after submitting it to the Minister. Drafts of the Authority’s business plans should be made public for comment in advance of submission to the Minister. Ensuring Accountability The requirement for canvassing stakeholders as set out in section 9.7 should be a requirement of the Authority on a regular basis (e.g. every three years), not solely upon request of the Minister. In canvassing stakeholders on the effectiveness of the Authority, the canvassing should also assess whether the Authority is carrying out their activities in an efficient and economical manner. Without direct representation of brand holders and any other stakeholders funding the Authority on its Board, regular canvassing is critically important to ensure the Authority is meeting expectations of effectiveness. AHAM also believes that clearer accountability for budgets is also needed. Of great concern is the Authority’s ability to set its own budget and corresponding revenue targets without adequate and specific authorization by elected officials. Despite Section 41 of the Resource Recovery and Circular Economy Act that requires the Authority to engage in pubic consultation and post the proposed fees for brand owners and producers, there are no mechanisms that require the Authority to demonstrate that they are providing value for the fee level being set. It is imperative that the Minister require the Authority to demonstrate during its annual budgeting process that it is practicing a formalized cost containment strategy. Clarifying Roles & Responsibilities – Data Clearinghouse The Draft Strategy for a Waste Free Ontario indicates that a key role of the Authority will be to operate a data clearinghouse. The intent is for the Authority to have the necessary data from the regulated community to effectively monitor and assess producer performance. The lack of detail on what information and data is to be collected by the Authority provides little comfort to producers who are very concerned about Confidential Business Information (CBI) being disclosed. It is imperative that the Authority develop policies and procedures concerning the data clearing house that explicitly include CBI protections. Equally important is level of burden and resources that producers must expend to produce and provide data. Any requests for data must be measured against the cost and resources required to generate the data and what utility the data will provide in the end. We have seen in other provinces that the cost and effort required to obtain third party audited information and data on stewardship programs’ non-financial attributes has been substantial with little benefit to the stewardship program itself, and the information and data provided being underutilized, or worse collecting dust, by regulators. Clearer expectations regarding the Authority’s role in operating and protecting a data clearinghouse should be set out in the Agreement. The Agreement should set out that the Authority is responsible for ensuring that any commercially confidential information collected for clearinghouse purposes is protected through security measures and controls that are consistent with modern industry security standards. The data clearinghouse function that the Authority will be performing must account for competing and individual programs. Brand-holders\producers will be subject to recycling goals (diversion, collection, accessibility etc.) that have been set by the Minister. Unlike under the old Waste Diversion Act, where all producers where required to belong to the Industry Funding Organization (other than those that had an approved ISP), the Resource Recovery and Circular Economy Act has a framework that allows multiple producer responsibility organizations (PRO) and individual stewardship programs to collect, divert, and recycle the same products and materials. Under such a scenario, it is important for the data clearinghouse to be able to monitor and track the allocation of tonnage by the various and at times competing systems. Not only will the clearinghouse need to be able to monitor and track, but it will also need to act in a capacity to ensure that there is a level playing field. The Authority will need to create a methodology that will enable standard metrics to be applied that can accommodate all the different systems. Because there will be multiple PRO’s and individual stewardship programs it is imperative that the metrics be developed in an open and transparent manner to allow feedback and input from all the various stakeholders. A standardized means of reporting is essential to ensure that all the systems are being evaluated in an equitable manner. This is particularly important when it comes to how the Authority will be assessing what fees are to be assessed to individual brand-holders\producers. We thank you for your consideration of these important issues, and we look forward to further discussing these matters with you.

[Original Comment ID: 208581]