"Energy and Mining Investment: Assessing Accountability for Indigenous Rights in Complex Investment Chains", August 2020.

...The financial consequences of failing to adequately address Indigenous rights can be substantial. One recent study estimates that a world-class mining operation with $3 to $5 billion in capital expenditures could lose roughly $20 million per week as a result of delayed production because of company-community conflict. Conversely, companies and investors benefit from a mature, respectful and productive relationship with Indigenous governments, communities, businesses and employees.

At the heart of many conflicts is Free Prior and Informed Consent (FPIC), a cornerstone of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). Opened for adoption in 2007, the Declaration has become a primary reference for Indigenous rights. Canada endorsed it in 2016 and British Columbia passed the Declaration on the Rights of Indigenous Peoples Act in November 2019, initiating a process to align provincial laws with UNDRIP and establishing a new high water mark for recognition of Indigenous rights and title. The federal government announced it will move ahead with legislation implementing UNDRIP in 2020. Neither the Act nor UNDRIP create new rights. They simply uphold “the same human rights and fundamental freedoms recognized in the Charter of the United Nations, the Universal Declaration of Human Rights and international human rights law.”

Assessing how well investee companies respect those rights and manage relationships with Indigenous governments and communities is a challenge for investment decision makers generally. It is even more challenging when complex financing structures for energy and mining projects extend the distance between investor decisions and management accountability, through mergers and acquisitions, minority shareholdings, joint ventures, royalty arrangements and other complex business relationships.....