Mining and indigenous people issues


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Objective Capital's Global Resources Investment Conference 2011
Stationers' Hall, City of London
27-28 September 2011
Day 1- Session1: The context in which we operate
Speaker: Aidan Davy, ICMM

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  • Investor interest in ESG risks: institutional investors, securities analysts, project finance and M&A
  • Indigenous Peoples are increasingly important in terms of resource access 45% of Peruvians are Indigenous 40% of Canada land mass is covered by twenty–two comprehensive land claim agreements (modern treaties) ratified and brought into effect since the Canada's comprehensive land claims policy in 1973. 
  • : Oil & Gas (47%), Mining (36%); Forestry (10%) and Agribusiness (7%)
  • Mining and indigenous people issues

    1. 1. Mining and indigenous people issues Aidan Davy –ICMM
    2. 2. Other sponsors & participating organisations: GLOBAL RESOURCES INVESTMENT CONFERENCE 2011 Lead sponsor: Media partners: @Objectivelive
    3. 3. Indigenous Peoples and Mining: Developing Projects for Mutual Benefit Aidan Davy, Director September 2011
    4. 4. Overview of presentation <ul><li>Coincidence between mining and Indigenous Peoples </li></ul><ul><li>A snapshot of investor perspectives </li></ul><ul><li>ICMM Good Practice Guidance </li></ul><ul><li>Conclusion </li></ul>
    5. 5. Top 10 countries for mining exploration Source: Interra Resources Intelligence (September 2010) Distribution of 22,400 projects (global total 40,000) Argentina 2%
    6. 6. Distribution of mining projects globally Source: Interra Resources Intelligence (September 2010)
    7. 7. Investor Perspectives on Indigenous Peoples <ul><li>Talisman Energy initiated a review of FPIC on basis of shareholder resolution (Bâtirente/RSSE) </li></ul><ul><li>Not just NGO’s advocating: Co-Op. Bank’s support for Beaver Lake Cree Nations vs. Tar Sands in Alberta </li></ul><ul><li>EIRIS, CAER and The Ethical Funds Company all promoting FPIC (ideally large ‘C’) </li></ul><ul><li>EIRIS analysed 250 companies from FTSE All World Developed Index </li></ul>
    8. 8. Indigenous Peoples – selected indicators % % % % Indigenous Policy FPIC (consent/consultation) Resettlement Indigenous employment Source: EIRIS (2009). Indigenous rights: risks and opportunities for investors Agribusiness Forestry & Paper Oil & Gas Mining
    9. 9. Policies and reporting on Indigenous Issues FPIC Global data Engage Respect Policy Case-study None None Indigenous Peoples Policy Indigenous Peoples Disclosures ICMM members Non-members
    10. 10. Do investors care about Indigenous Peoples? Vedanta resources share price (2010)
    11. 11. Do regulators care about Indigenous Peoples? Sources: Photo: Lorna Elkins, 2008 Taseko Mines Ltd share price (2010) Oct Dec Nov
    12. 12.
    13. 13. Free, Prior and Informed Consent (FPIC)
    14. 14. Where does ICMM stand on FPIC? <ul><li>Where legally mandated, ICMM’s Guide is a valuable resource to support FPIC implementation </li></ul><ul><li>Where governments don’t fully embrace FPIC, companies can’t unilaterally endorse </li></ul><ul><li>Guide supports members to implement progressive commitments in ICMM Position Statement </li></ul><ul><li>Currently engaging with IFC and others around practical implementation challenges </li></ul>
    15. 15. Indigenous Peoples & Mining Good Practice Guide <ul><li>Council of CEOs approved Position Statement on Mining and Indigenous Peoples in May 2008 </li></ul><ul><li>Explicit commitment to develop Guide included in 2008 Position Statement </li></ul><ul><li>From outset, independent Indigenous Peoples Advisory Group established: critical aspect of guide development </li></ul><ul><li>Team from academia and consulting selected </li></ul><ul><li>Case studies verified with Indigenous community representative: good practice examples balanced by negatives </li></ul>
    16. 16. Engagement and Indigenous Participation <ul><li>Outlines a series of principles for good engagement, and what it should achieve – and distinctive challenges </li></ul><ul><li>Focuses on steps to achieve broad community support through meaningful engagement </li></ul><ul><li>Discusses FPIC and related challenges </li></ul><ul><li>Explores practicalities of Indigenous engagement, as well as challenges </li></ul>
    17. 17. Laying the groundwork <ul><li>Focus on establishing basis for sound relationships early </li></ul><ul><li>Determining rights and interests: legal, customary and sometimes competing </li></ul><ul><li>Conducting comprehensive baseline studies, which address vulnerability </li></ul><ul><li>Assessing positive and negative impacts: iterative rather than one-off </li></ul>
    18. 18. Agreements <ul><li>Focus on negotiated agreements to define and regulate company-community relationships </li></ul><ul><li>Explores attributes of successful agreements </li></ul><ul><li>Discusses process aspects in detail </li></ul><ul><li>Outlines substantive aspects, e.g. financial, employment/contracting, impact management, governance </li></ul>
    19. 19. Managing Impacts and Sharing Benefits <ul><li>Emphasis on: </li></ul><ul><ul><li>Practical dimensions of impact mitigation and benefits sharing </li></ul></ul><ul><ul><li>Information/knowledge sharing </li></ul></ul><ul><ul><li>Compensation to redress physical and economic losses </li></ul></ul><ul><ul><li>Concept of ‘strengthening community asset base’ is key to benefits </li></ul></ul><ul><ul><li>Addressing cultural and environmental preservation </li></ul></ul><ul><ul><li>Recognizing discrimination and historical disadvantage </li></ul></ul>
    20. 20. Dealing with Grievances <ul><li>Focuses on implementing effective grievance mechanisms </li></ul><ul><li>Acknowledges inevitability of disagreements, and imperative of effectively addressing these </li></ul><ul><li>Explores potential sources of conflict </li></ul><ul><li>Provides detailed guidance on design aspects, e.g. culturally appropriate, accessibility, process predictability etc. </li></ul>
    21. 21. &quot;Move on!&quot; Has the Native American no rights that the naturalized American is bound to respect? (Harpers weekly, 1871)
    22. 22. For further information please contact: Aidan Davy, Director [email_address] Available to download at