The challenge, the new goal for the new century must be not only    to supply the energy the world needs, but also to demo...
-i-i        Foreword & AcknowledgmentsThis report explores BP Venezuela’s relationship with Indigenous peoples. It is the ...
- ii -Table of Contentsi      Foreword & Acknowledgments ....................................................................
- iii -TablesTable 1 A Comparison of Development Technology Tools............................................... 25Table 2...
-1-1       EXECUTIVE SUMMARYIntroductionBP Venezuela, as the operator in a joint venture with the Venezuelan State oil com...
-2-has Declared 1994 to 2004 as the International Decade of the World’s Indigenous people and theWorld Bank and many other...
-3-This report uses Development Technology, an analytical framework and a three pronged strategydeveloped by Wayne Dunn & ...
-4-Summary of RecommendationsWe have identified 21 distinct issues that need to be addressed and have formulated 21 inter-...
-5-       2. Revise/amend recommendations as necessary       3. Engage a consulting firm to assist with the implementation...
-6-SummaryBenefits must accrue to the Warao through normal, ongoing operations and activities. Donationsand humanitarian r...
-7-2       INTRODUCTIONIn order to better understand how it can enhance its relationship with the Warao peoples, BPVenezue...
-8-3       BACKGROUND ON WARAO PEOPLESThe following description of the Warao people of Venezuela, outlines the conditions ...
-9-In addition, the Warao must contend with the local, state, federal and international authorities’relative lack of inter...
- 10 -3.3       Current Conditions of the WaraoIn addition to documenting Warao people’s cultural characteristics and thei...
- 11 -possibility that adverse publicity on the BP/Warao situation could erode the goodwill generatedthrough BP’s progress...
- 12 -3.5    International Context of Indigenous IssuesThe past twenty years (and particularly the last ten) have seen a r...
- 13 -Indigenous peoples themselves are becoming increasingly proactive in defining their own future.Where previously, Ind...
- 14 -3.6.1   Current StrategyBP Venezuela recently articulated a three point strategy for its relationship with the Warao...
- 15 -4   GENERAL CHALLENGESBP will face many challenges as it strives to develop a long-term, mutually beneficial andinte...
- 16 -5       DEVELOPMENT TECHNOLOGYResource companies such as BP are facing new challenges in their quest to harvest reso...
- 17 -      3. Does the current process of measuring and monitoring the impact that operations         and activities have...
- 18 -Warao peoples. In order to have the pan-operation goal alignment that is necessary to maintaingood Warao relationshi...
- 19 -The health and water delivery projects that BP has initiated can begin to create a foundation fromwhich other, more ...
- 20 -5.3.3   Training & Education        We will only have true development and full human rights when individuals have  ...
- 21 -Hiring and recruitment efforts are also a very cost effective and sustainable way to provide localbenefits (see Tabl...
- 22 -economy develop the capacity to capitalize on the roads, airports and other local infrastructureimprovements that of...
- 23 -partners together and facilitate arrangements. This has allowed them to award multi-milliondollar underground mining...
- 24 -using one to build the capacity to enable the effective use of others (i.e. supporting basic healthand education to ...
- 25 -Table 1 A Comparison of Development Technology Tools                        Self Sustaining           Enhances Self ...
- 26 -5.4   Development Technology Results: Measuring the Impact        “(W)hat gets measured gets done” - John Browne, 17...
- 27 -6     ISSUES, STRATEGY & RECOMMENDATIONS6.1    StrategyBased on the research and analysis carried out, we recommend ...
- 28 -6.2   Enhancing the Corporate EthosIssue 1:             BP requires that all Personnel are able to work effectively ...
- 29 -                     2.   When developed it should be mandatory for all personnel, including                        ...
- 30 -Issue 2:             BP has a considerable internal knowledge base on Indigenous                     information, bu...
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
BP Venezuela Indigenous Relations:  Meeting the Challenge – Responsibly and Sustainably
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BP Venezuela Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

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Wayne Dunn prepared this report to assist BP Venezuela to work more effectively with the Warao Peoples of the Orinoco Delta, where BP had recently begun exploring. The report is based on field research and detailed analysis undertaken by Wayne Dunn. It explores the current state of BP/Warao relationships and emerging challenges. It examines the current socio-economic state of the Warao, which was deplorable (not because of BP). The report set out a framework to enable BP to develop mutually beneficial and productive relationships with the Warao Peoples and also outlined a framework that would enable effective management of the relationship efforts.

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BP Venezuela Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

  1. 1. The challenge, the new goal for the new century must be not only to supply the energy the world needs, but also to demonstrate that we can do so in ways which are acceptable and enhance the life of the community as a whole. - John Browne, New York 17 November 1997 Indigenous Relations:Meeting the Challenge – Responsibly and Sustainably Prepared for: BP Venezuela March 14, 1998 Prepared by: Wayne Dunn & Associates 2457 Bakerview Rd Mill Bay, BC V0R 2P0 CANADA Tel: +1-250-743-7619 Fax: +1-250-743-7659 info@waynedunn.com www.waynedunn.com
  2. 2. -i-i Foreword & AcknowledgmentsThis report explores BP Venezuela’s relationship with Indigenous peoples. It is the result oftwo weeks of field research 1 in Venezuela and draws upon the authors’ previous professionalexperiences in working with business and with Indigenous development.The authors would like to acknowledge the leadership of Mr. Ellis Armstrong andMr. Mike Daly of BP Venezuela, for having the foresight to realize the importance ofestablishing sustainable, long term relationships with Indigenous peoples, and for having thecourage to give us complete latitude to undertake our research.While everyone at BP Venezuela was very helpful and supportive, some deserve specialmention. The leadership of Cinzia de Santis and the enthusiastic support received from herand her staff enabled the consultants to focus on their work without having to concentrate onsupport and logistical details. As well, the support and the personal information and insightsprovided by the environmental and health officers, Valentina Rodriguez, Jesús María Molinaand William Espinoza contributed greatly to our efforts. Additionally the information on theWarao peoples, assembled by Walewska Miguel, was particularly useful.The authors also wish to acknowledge the value of previous research reports and informationassembled through the efforts of BP Venezuela and other parties. Additionally, thecollaboration of the many other organizations and individuals we met contributed greatly toour work. Finally, and perhaps most importantly, we would like to thank the Warao peoplefor allowing us to visit their communities and for taking time from their daily routines tomeet with us.- Wayne Dunn- Rodrigo Contreras1 Appendix 1 contains a daily activity report covering the field research.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  3. 3. - ii -Table of Contentsi Foreword & Acknowledgments ........................................................................... i1 Executive Summary ............................................................................................. 12 Introduction ......................................................................................................... 73 Background on Warao Peoples .......................................................................... 8 3.1 GENERAL AND HISTORIC ............................................................................................................. 8 3.2 LAND RIGHTS AND ISSUES .......................................................................................................... 9 3.3 CURRENT CONDITIONS OF THE WARAO .................................................................................... 10 3.4 WARAO AND OTHER INDIGENOUS ORGANISATIONS .................................................................. 11 3.5 INTERNATIONAL CONTEXT OF INDIGENOUS ISSUES .................................................................. 12 3.6 BP VENEZUELA’S INDIGENOUS RELATIONSHIPS TODAY ........................................................... 13 3.6.1 Current Strategy .............................................................................................................. 144 General Challenges ............................................................................................ 155 Development Technology .................................................................................. 16 5.1 WHAT IS DEVELOPMENT TECHNOLOGY? .................................................................................. 16 5.1.1 Analytical Framework ..................................................................................................... 16 5.1.2 Strategy ............................................................................................................................ 17 5.2 CORPORATE ETHOS: THE DEVELOPMENT TECHNOLOGY FOUNDATION .................................... 17 5.3 DEVELOPMENT TECHNOLOGY TOOLS: ...................................................................................... 18 5.3.1 Humanitarian Assistance/Direct Grants ......................................................................... 18 5.3.2 Leverage/Influence with Third Parties ............................................................................ 19 5.3.3 Training & Education ...................................................................................................... 20 5.3.4 Employment ..................................................................................................................... 20 5.3.5 Procurement .................................................................................................................... 21 5.3.6 Other Tools ...................................................................................................................... 23 5.3.7 Comparing the Tools ....................................................................................................... 23 5.4 DEVELOPMENT TECHNOLOGY RESULTS: MEASURING THE IMPACT ......................................... 266 Issues, Strategy & Recommendations .............................................................. 27 6.1 STRATEGY ................................................................................................................................. 27 6.2 ENHANCING THE CORPORATE ETHOS ........................................................................................ 28 6.3 DEPLOYING THE TOOLS............................................................................................................. 35 6.3.1 Humanitarian Assistance/Direct Grants ......................................................................... 35 6.3.2 Leverage/Influence with Third Parties ............................................................................ 37 6.3.3 Training and Education ................................................................................................... 40 6.3.4 Employment ..................................................................................................................... 44 6.3.5 Procurement .................................................................................................................... 46 6.3.6 Other Tools ...................................................................................................................... 48 6.4 SETTING TARGETS AND MONITORING RESULTS ........................................................................ 53 6.5 ADMINISTRATIVE ...................................................................................................................... 56 6.6 LIST OF ALL ISSUES ................................................................................................................... 58 6.7 IMPLEMENTATION FRAMEWORK MATRIX ................................................................................. 607 Short Term Action Plan .................................................................................... 618 Conclusion .......................................................................................................... 63BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  4. 4. - iii -TablesTable 1 A Comparison of Development Technology Tools............................................... 25Table 2 Implementation Schedule ....................................................................................... 60Appendices (included in hard copy only)1. Preliminary Report2. ILO Convention 1693. Reference Documents and Information Sources4. BP Venezuela Draft Indigenous Policy (Spanish)5. List of Documents Contained in Accompanying Document: Selected Articles, Reports, Declarations and Findings on Indigenous peoples rights and economic development interests and initiativesAccompanying Documents 21. Selected Articles, Reports, Declarations and Findings on Indigenous peoples rights and economic development interests and initiatives.2 This is a selection of articles, reports, declarations and findings on Indigenous peoples rights and economicdevelopment initiatives compiled by Wayne Dunn & Associates to provide BP Venezuela with immediate accessto additional background information.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  5. 5. -1-1 EXECUTIVE SUMMARYIntroductionBP Venezuela, as the operator in a joint venture with the Venezuelan State oil company PDVSA,was recently awarded an exploration concession in the Delta-Amacuro state in Venezuela. Theconcession is on lands traditionally occupied by the Warao, a severely marginalized Indigenouspeople. BP wants to establish sustainable and mutually beneficial relationships with the Waraopeoples and communities, and has initiated a number of activities and projects towards this end.Wayne Dunn & Associates, an international consulting firm, was contracted to review the Waraorelationship and identify strategies and opportunities to further develop the relationship. Thisreport is a result of that engagement.BackgroundThe Warao Indigenous Peoples are the second largest Indigenous group in Venezuela, numberingabout 20,000. They inhabit small settlements throughout the Orinoco Delta and, as a result ofcenturies of neglect and exploitation, are living under extreme pressures. Some of the morealarming statistics are: • The Warao have an average life expectancy of 34 years • The Warao have a human development index of .2 • 99% of the Warao people are effectively illiterate • 30% of Warao infants die before they reach one year of age • 71% of Warao infants die before reaching 5 years of age (according to the mothers, 48% of these deaths are from diarrhea) • 100% of the Warao communities lack sewer and water services and most have no access to potable water. (The Warao in the BP area have no access to fresh water due to previous oil industry (non BP) activity which caused salt water to flood into the delta channels approximately 30 years ago.) • 97% of Warao adults do not have a fixed incomeAlthough the Warao have almost no institutional capacity of their own, they are represented onthe Executive of Consejo Nacional Indigena de Venezuela (CONIVE), the National IndigenousCouncil of Venezuela. Through CONIVE they are connected to other international Indigenousorganizations that participate actively in the growing international Indigenous agenda.International interest in Indigenous issues has grown rapidly within the past twenty years. Multi-lateral and international organizations are beginning to address the issue in a number of ways.The International Labour Organization (ILO) has adopted Convention 1693, the United Nations3 See Appendix 2 for a copy of ILO Convention 169BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  6. 6. -2-has Declared 1994 to 2004 as the International Decade of the World’s Indigenous people and theWorld Bank and many other bodies have adopted policies, directives and other mechanisms tohelp them deal with the growing focus on Indigenous peoples.As well, Indigenous organizations themselves are capably representing their issues and concernsat national and international forums throughout the world. Recently, due to pressures fromIndigenous peoples, the scope of Indigenous issues has broadened and now regularly includesbusiness, economic development and trade concerns and opportunities. Despite the fact thatprevious interactions between Indigenous peoples and business tended to be antagonistic, thereare emerging examples that demonstrate mutually beneficial collaboration between the twogroups.BP’s Relationship with the WaraoFrom the very beginning of its operations in the Delta-Amacuro, BP has pro-actively worked toestablish mutually beneficial and sustainable relationships with the Warao peoples. Numerousstudies were commissioned and humanitarian programs in health and water delivery have beenimplemented. Other programs and activities are underway to enhance the relationship, includinginternal policy and strategy development and actively sharing information with other BP assets.From senior executives to the field staff, a sincere desire to ‘do the right thing’ in BP-Waraorelations, is evident.Despite having a positive and pro-active beginning to the relationship, there are still somechallenges that BP will have to overcome to achieve its goal of a long term, mutually beneficialand sustainable relationship. BP will need to find a cost effective way to move beyond theircurrent approach and provide the Warao with opportunities for productive participation(employment, procurement, etc.) in the exploration and production activities. Given the currenteducational and experience level of the Warao this is a significant challenge. BP should begintaking immediate steps to meet this challenge. If not, BP could easily find itself several years andtens of millions of dollars into the project and having to explain why the impoverished Waraohave not received any of the employment and business opportunities from the development of oilreserves on their traditional homelands.BP Venezuela has already articulated a strategy and begun to put in place activities that will helpit to meet the challenges outlined above. This report will recommend enhancements andadditional initiatives to build upon the leadership BP has already demonstrated.Development TechnologyResource companies such as BP are facing new challenges in their quest to develop resourcesefficiently and responsibly. They must learn to collaborate across diverse cultural andgeographical dimensions, while at the same time balancing social and environmentalresponsibility with short term profitability and long term growth. And they must do this underincreasing public scrutiny and with constantly shifting commodity prices.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  7. 7. -3-This report uses Development Technology, an analytical framework and a three pronged strategydeveloped by Wayne Dunn & Associates, to suggest how BP can meet these new challenges in arational and cost-effective manner.The three key elements of a Development Technology strategy are: 1. Developing a corporate ethos that facilitates working effectively across diverse cultures 2. Understanding and deploying a set of tools to enhance local relationships by cost effectively and sustainably increasing benefits accruing to local interests. These tools are: a) Humanitarian Assistance/Direct Grants b) Leverage/Influence with Third Parties c) Training & Education d) Employment e) Procurement 3. Measuring and monitoring the impact that operations and activities have on the community and then using the information to implement a continuous improvement process.Our analysis revealed that, while BP has made a progressive start, there are significantopportunities to cost-effectively enhance and improve long term relationships with the Waraopeoples through the implementation of a comprehensive Development Technology strategy. Theimplementation of this strategy will focus increasing efforts on training and education,employment and procurement while helping develop Warao capacity and collaborating moreeffectively with Indigenous organizations and others involved in Warao development.StrategyThe recommended strategy is: To cost effectively and efficiently organize exploration activities so that they support BP’s social responsibility objectives of contributing to the development of civil society, environmental responsibility and maximizing the sustainable benefits received by local interests.The following recommendations outline the basic elements of the implementation of the strategy.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  8. 8. -4-Summary of RecommendationsWe have identified 21 distinct issues that need to be addressed and have formulated 21 inter-related recommendations to address the issues and support the implementation of the strategyarticulated above. The issues and recommendations along with individual implementationstrategies are detailed in Section 6. They can be summarized in four key points. 1. In order to effectively manage and maintain mutually beneficial relationships with the Warao, it is critical that the entire BP Venezuela organization have an enhanced ability to work effectively across diverse cultural dimensions. Additionally, while BP has an impressive level of internal information on Indigenous issues, it is necessary to consolidate that information in order to better socialize it throughout the organization. As well, ongoing initiatives to continue building and maintaining the information base are recommended. 2. BP should utilize its leverage with third parties in order to support its efforts with the Warao. Additionally, various training, education, employment and procurment initiatives should be developed and launched in order to maximize opportunities for Warao to participate productively in BP’s activities. Some resource companies in other areas have been particularly successful at this and we are recommending BP personnel undertake a visit to see their operations first-hand. 3. BP needs to establish direct relationships with representative Indigenous organizations and motivate the establishment of a coordinating mechanism to facilitate increased collaboration on Warao issues across a range of organizations and institutions (including direct Indigenous participation) 4. Finally, in order to successfully execute the recommendations and objectives outlined above, BP should establish quantifiable targets and objectives and systematically monitor progress towards them.Short Term Action PlanThe preceding strategy and recommendations form a comprehensive and integrated program. It isimportant that the appropriate executives and staff review the analysis, strategy andrecommendations, amend them as necessary and arrive at a consensus regarding theirimplementation. Many of the recommendations demand immediate attention and will need activesupport from many quarters in order to be implemented effectively.We recommend execution of the following 5 point short term work plan in order to facilitateimplementation in a timely, effective and coordinated manner. 1. In a one day, off-site workshop with key staff, consultants and a facilitator, review the report and recommendations and develop a consensus on the implementation.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  9. 9. -5- 2. Revise/amend recommendations as necessary 3. Engage a consulting firm to assist with the implementation plan. In addition to assisting with overall implementation, the firm should assume primary responsibility for 4: a) Cross cultural communications and sensitization program (design, develop, train in-house delivery capacity, assist with delivery of initial sessions and enhance as appropriate) b) Facilitate the establishment of a direct relationship with CONIVE c) Assist with identification of gaps in the internal Indigenous knowledge and information base d) Assist with supplementing the internal knowledge base as necessary e) Assist with coordinating an observation visit to Cameco’s Canadian operations f) Assist with the identification of multi-lateral/international development partners and collaborators g) Assist with motivating the establishment of a coordinating mechanism h) Provide ongoing review of emerging issues and challenges surrounding BP’s Indigenous relationships and initiatives i) Provide other assistance and support as required. 4. Proceed as quickly as possible with the following activities (or as revised in the step 1 workshop): a) develop and deliver cross cultural communications and sensitization workshops b) establish a direct relationship with CONIVE c) motivate a community clean-up campaign d) enhance and adopt BP’s Indigenous policy e) visit Cameco’s Canadian operations to determine the applicability of their experience f) consolidate and enhance internal information and knowledge base g) develop and implement a communications strategy (initial step is the announcement of the program by the BP Venezuela President to give it profile) h) initiate an ongoing review of emerging issues and challenges related to BP’s Indigenous relationships and initiatives 5. Implement the remaining recommendations as outlined in their respective implementation strategies.4 This may change depending of the specifics of the implementation plan adopted in item 1BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  10. 10. -6-SummaryBenefits must accrue to the Warao through normal, ongoing operations and activities. Donationsand humanitarian relief on their own, while important initially, will not produce the results BPrequires. Warao people need the opportunity to become productively involved at all levels ofBP’s operations in Pedernales/Guarapiche. But, the reality of the situation is such that, withoutfocused effort and commitment, few Warao people will secure employment, training, or businessopportunities from BP’s operations. In addition to other considerations, BP cannot risk beingseveral years into the project and having extracted millions of dollars worth of oil without theWarao people participating in the business and employment opportunities. For a public companywith BP’s profile and commitment to transparency and corporate social responsibility, this maybe an indefensible position.Organizing activities and operations to facilitate productive Warao involvement in BP’soperations represents a major challenge. To meet this challenge responsibly and sustainably willrequire pan organization goal alignment around a comprehensive and integrated strategy that isboth far-reaching and cost-effective.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  11. 11. -7-2 INTRODUCTIONIn order to better understand how it can enhance its relationship with the Warao peoples, BPVenezuela contracted the international consulting firm of Wayne Dunn & Associates to reviewthe BP/Warao relationship and identify strategies and opportunities to further develop therelationship along sustainable and mutually beneficial lines.In order to fulfill this mandate two consultants, Wayne Dunn and Rodrigo Contreras, spent twoweeks (Feb. 1-14) in Venezuela conducting numerous interviews in both English and Spanish, inorder to research and evaluate the relationship. The consultants met with and interviewed; BPstaff and executives in Caracas, Maturin and Pedernales, spent several days visiting Waraocommunities and territories, interviewed and met with numerous third parties including,SOCSAL, Indigenous Parliament, Canadian Embassy, CONIVE, Inter-American Foundation,Municipality of Pedernales, Indigenous Directorate of the Department of Education, Governmentof Venezuela and PDVSA-the Venezuelan state oil company (a detailed work and activity reportis contained in Appendix 1). As a result of this field research a number of observations weremade and preliminary findings and insights were noted 5. A report BP and Indigenous Peoples inVenezuela: Preliminary (Debriefing) Report, was prepared and presented to BP Venezuelaexecutives at a debriefing session in BP’s Caracas offices on February 13, 1998. This report isattached as Appendix 1.Following the field research in Venezuela, the consultants returned to their Canadian officeswhere they have reviewed and analyzed the research, identified key issues and formulated anumber of strategic and operational recommendations designed to further enhance BP’srelationship with the Warao peoples.The following sections summarize the research, discuss the analysis and outline therecommendations and their implementation strategy.5 The observations and findings and insights are also contained in the above noted report.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  12. 12. -8-3 BACKGROUND ON WARAO PEOPLESThe following description of the Warao people of Venezuela, outlines the conditions in whichthey live and gives an overview of BP Venezuela’s interactions with them. As well, it provides abrief summary of pertinent international issues and developments that relate to BP’s Indigenousrelationships. The information was obtained from various reports commissioned by BPVenezuela and others, and from various additional documents and information sources. A fulllisting of documents and information sources is contained in Appendix 3. Additionally, a numberkey reports, findings and documents have been compiled into an accompanying document 6,copies of which were submitted along with this report.The following information is essential as it presents the setting in which BP and others must workand develop positive relationships with the Warao peoples.3.1 General and HistoricThe Warao people are the original inhabitants of the Delta-Amacuro State in Venezuela. Theyare believed to have arrived during the early waves of South American immigration at least10,000 years ago. There are approximately 20,000 Warao, occupying the shores of the OrinocoDelta and living in settlements of fifty to three hundred people. The Warao are the second largestindigenous population in Venezuela after the Wayuu people who live in the State of Zulia.The Warao, like other traditional peoples, have depended for their livelihood on fishing, huntingand gathering. They have historically maintained trade relations with their neighbors, includingthe European settlers who came to dominate the surrounding land after European ‘discovery’ andcolonization. As long as the Warao could retreat into impenetrable and undesirable swamplandsof the Orinoco Delta, the structure of their society was not fundamentally altered. However, withthe growing impact of colonization and the discovery of oil on their traditional lands they nolonger have anywhere to retreat and today are generally living in sedentary communities. Thesesedentary conditions and the direct and constant interaction with various actors, (missionaries,anthropologists, government authorities, traders and businesses) is having a severe negativeimpact on the Warao. Nearly always these interactions are top-down relationships with theWarao receiving, at best, less than fair value for their contributions. The Warao tradition simplydoes not prepare them to operate effectively in an institutionalized, monetary based economy andthey appear to have minimal understanding of government and other administrative procedures.This situation is compounded by ongoing discriminatory practices, which preclude the Waraofrom effective involvement in decisions affecting their lands and communities.Today, after 10,000 years of successful existence in the Orinoco Delta, the Warao face a complexset of pressures that threaten their very survival. On the one hand they have traditionalresponsibilities such as the provision of social and economic support to family, the maintenanceof community structures, cultural continuity, and basic survival. On the other hand they are facedwith economic, academic and religious prospectors seeking resources, knowledge and their soul.6 See Attachment 5 for a complete listBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  13. 13. -9-In addition, the Warao must contend with the local, state, federal and international authorities’relative lack of interest in their development.A further complication and pressure on Warao people comes from the Narco-traffic that isprevalent in the region. The Orinoco River provides a transportation corridor that takes narcotictraffic, destined for the world market, directly past Warao villages and settlements.The above discussion briefly illustrates the increasing economic and social pressures facingthe Warao people today and should be understood by all BP staff in order to developsustainable collaborative relationships.3.2 Land Rights and IssuesAlthough many, including BP, refer to the land as ‘Warao territory’, the issue of Warao landownership or even their right to the use and occupation of the land is, at best, unclear. While it isgenerally assumed that the region belongs to the Warao people on a symbolic basis, this does notseem to give the Warao any specific land rights. It does not appear that they were even consultedprior to the awarding of oil exploration concessions.Article 77 of the present Venezuelan Constitution concedes land for Warao use or occupationwithout legalizing any title. This article mandates the government to improve the conditions ofpeasants with special provisions, where appropriate, to protect indigenous peoples and to permittheir progressive incorporation to the life of the State. In specific reference to the Warao people,the Venezuelan Government upholds the Guarapiche decree whose basic objective is theestablishment of a Forest Reserve Plan and the maintenance and protection of the indigenousWarao and Kariña, including their occupation and usage of the area.ILO Convention 107 7 (1957), which was ratified by Venezuela in 1983, contributes to theprotection of indigenous land by recognizing the common or individual right of land ownershipfor the land traditionally occupied by them (Article 11). Article 12 of Convention 107 goesfurther by stating that it is not possible to transfer local populations without their approval.The Venezuelan Presidential Decree 250 (1951) regulates access to Indigenous areas. Accordingto this decree, all non-Indigenous persons or institutions wishing to visit Indigenous lands mustobtain special permits from the department of Indigenous Affairs (which is presently under theauthority of the Ministry of Education). However, this decree is rarely applied, allowingoutsiders unfettered access to the Warao people and territory.According to the last census in 1992, 72% of Venezuelan indigenous communities do not claim topossess any land title whatsoever. Those claiming to have titles generally do not understand whatlevel of legal ownership they may have. The percentage of legal land ownership in Waraocommunities is even lower than it is in the general Venezuelan Indigenous population.7 ILO Convention 107 has been superseded by ILO Convention 169 – see Section 3.5 for additional discussion onConvention 169BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  14. 14. - 10 -3.3 Current Conditions of the WaraoIn addition to documenting Warao people’s cultural characteristics and their historically unequalrelationships with the dominant society, the plethora of reports all comment on the deplorable andunacceptable economic and social conditions in which the Warao exist today.Some of the more alarming statistics contained in these reports and articles include: • The Warao have an average life expectancy of 34 years • The Warao have a human development index of .2 • 84% of the Warao people have no formal education • 99% of the Warao people are effectively illiterate • 30% of Warao infants die before they reach one year of age • 71% of Warao infants die before reaching 5 years of age (according to the mothers 48% of these deaths are from diarrhea) • 100% of the Warao communities lack sewer and water services and most have no access to potable water. (The Warao in the BP area have no access to fresh water due to previous oil industry (non BP) activity which caused salt water to flood into the delta channels approximately 30 years ago.) • Virtually all Warao people exist in a subsistence economy and are heavily exploitated by outsiders • 97% of Warao adults do not have a fixed incomeThese conditions demand urgent action from all actors involved in the development of the region.Governments, international agencies, non-governmental organizations (NGOs), resourcecompanies, local authorities and, most importantly, the people themselves must be involved inchanging this situation. Sanitation, education and training, health, nutrition, water supply,economic development capacity, environmental protection, income generation, businessopportunities and sustainable development are just a few of the areas needing immediateattention.The reports and information noted above are common knowledge and are of great concern to allactors in the region. There is movement towards the initiation of action to begin to alleviate theseconditions. BP launched several specific programs focusing on enhancing health, ensuring watersupply and establishing medical facilities and treatment programs. These initiatives are seen aspositive steps, especially given the short time BP has been active in the area. But, more needs tobe done if BP is to meet the challenge of profitably developing the oil reserves, while maintainingmutually beneficial and collaborative relationships with Warao people and their communities.If BP Venezuela is not involved in successful efforts to alleviate the condition of Warao people, itwill leave itself very vulnerable to public criticism, especially from those groups and individualsthat are intent on terminating oil development in the area. An additional concern for BP is theBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  15. 15. - 11 -possibility that adverse publicity on the BP/Warao situation could erode the goodwill generatedthrough BP’s progressive stance on environmental responsibility.3.4 Warao and other Indigenous OrganisationsWarao people and communities interact and conduct communication through an ad-hoc systembased on traditional practices and encounters. There is not a formally established Warao networkor institutional structure and community representation is basically on an individual basis, withlittle institutional structure. There is an incipient effort to establish networking and coordinatingcapacity through a union of Warao communities. This effort, called the Warao Union, attempts toexpress the views and concerns of the Warao to CONIVE, the National Council of IndigenousPeoples of Venezuela.CONIVE was established in 1990 to support the aspirations of Indigenous peoples in Venezuelaand to promote Indigenous unity. CONIVE addresses issues such as land tenure, human rights,environmental management, economic development and resource development. A key objectiveis the effective participation of Indigenous peoples in all affairs of Venezuelan society. CONIVEoperates with an executive body and with representation from regional Indigenous organizationssuch as the Warao Union. They hold membership in the Coordinating Body of the Amazon Basin(COICA) and maintain close working relations with the World Council of Indigenous Peoples(WCIP). Both COICA and WCIP are active participants in international Indigenous processesand activities (see next section for detailed discussion of these activities). CONIVE has followedthe United Nations and other international Indigenous processes and activities closely, but itsactive participation has been sporadic, largely due to lack of financial and technical capacity.CONIVE has, at best, only minimal core financing, which limits its capacity to carry out itsobjectives.Although recent progress has been made, we find there are few examples of collaborative effortsbetween private industry and Indigenous organizations such as CONIVE. In fact, in many cases,past relationships have been antagonistic. Despite these difficulties, Indigenous organizations areseeking innovative relationships with industry 8, where their concerns can be fully taken intoaccount. CONIVE has indicated a willingness to enter into dialogue with BP and other firms, toexplore opportunities for meaningful participation in the oil industry. This is a significantdevelopment and represents a valuable opportunity for BP to establish direct relationships withCONIVE.8 For many years international attention on Indigenous issues has focused on Human rights, culture, environment andother related areas, while paying little attention to income generation and business development. However, in recentyears, Indigenous peoples throughout the world have been expressing growing interest in business and economicopportunities. The accompanying document, Selected Articles, Reports, Declarations and Findings on Indigenouspeoples rights and economic development interests and initiatives contains a number of reports and articles related toIndigenous peoples business and economic development. Perhaps José Oritz of Costa Rica, speaking in Copenhagen,Denmark at the Nordic Council of Minister’s Seminar on Indigenous Production and Trade (1995) said it best, “Aculture that cannot be financially self sufficient will die”.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  16. 16. - 12 -3.5 International Context of Indigenous IssuesThe past twenty years (and particularly the last ten) have seen a remarkable amount of interest inIndigenous peoples and their concerns and issues. This has been translated into policy and actionby multi-lateral and international development agencies, NGOs and to a lesser degree by nationstates 9 and private businesses.In June 1989 the International Labour Organization (ILO) adopted Convention 169 Indigenousand Tribal Peoples Convention. To date, this is known as the only international instrument thataddresses Indigenous human rights and their economic, social and cultural concerns. The UnitedNations (UN) and the Organization of American States (OAS) are in a process of discussions forpossible adoption of their respective declarations on the rights of Indigenous peoples.Multi-lateral agencies such as the World Bank, the Inter-American Development Bank (IADB),the United Nations Development Programme (UNDP), the World Health Organization (WHO),the Pan American Health Organization (PAHO) and the United Nations Children’s Fund(UNICEF) have also issued policy guidelines and directives that attempt to respond to the needsand concerns of Indigenous peoples. As well, there have been numerous conferences, workshopsand speeches calling for the establishment of a permanent UN Forum for Indigenous peoples.The United Nation’s proclamation of the International Year of the World’s Indigenous People in1993 and the subsequent proclamation of the International Decade of the World’s IndigenousPeople (1994-2004) also illustrate growing international interest in Indigenous issues.Additionally, the international attention focused on environmental concerns often includesIndigenous issues as well. The Rio process (United Nations Conference on Environment andDevelopment [UNCED]) culminated in agreements such as Agenda 21, Chapter 26 & 37 whichdeal with Indigenous issues and capacity building. As well the United Nations EnvironmentProgramme’s Convention of Biological Diversity produced an agreement in which two articles8(J) and 10(C, D & E) deal specifically with Indigenous peoples issues. The protection ofIndigenous lands and territories, the use of traditional knowledge, the need for sustainabledevelopment and for Indigenous participation in the resources on their lands are dealt with inthese articles 10.In addition to the above, nation states are coming under increasing pressure to deal withIndigenous land rights and other Indigenous matters. Also, a growing commitment to socialresponsibility is motivating some businesses to take increased interest in Indigenous issues andconcerns. The environmental review process and the increasing public scrutiny of resourceprojects are forcing many other businesses to come to terms with Indigenous peoples’ concerns.9 For the multi-lateral documents noted in this section the authors acknowledge relying on the analysis contained in TheRights of Indigenous Peoples Under International Law: Selected Issues, a paper prepared by Fergus MacKay. Thispaper is reproduced in the accompanying document, Selected Articles, Reports, Declarations and Findings onIndigenous peoples rights and economic development interests and initiatives.10 Copies of above referenced documents and reports are contained in the accompanying document, Selected Articles,Reports, Declarations and Findings on Indigenous peoples rights and economic development interests and initiatives.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  17. 17. - 13 -Indigenous peoples themselves are becoming increasingly proactive in defining their own future.Where previously, Indigenous issues were often limited to human rights and environmentaldimensions, a new generation of well educated and articulate leaders are defining Indigenousissues in the broadest possible terms. Today you will find Indigenous peoples involvingthemselves across the full range of human endeavors. As noted previously, there is also agrowing interest in Indigenous business and economic development. There have been a numberof recent international events focusing on this arena. Reports and recommendations from manyof these are contained in the accompanying document.These issues and developments are generating a global climate where companies operating onIndigenous lands or in proximity to Indigenous peoples must learn to collaborate efficientlyand effectively. Resource companies must learn how to organize their activities so thatIndigenous peoples are partners in the process and receive real and meaningful benefits.Companies that fail to learn how to do this effectively will find themselves under increasingpressure from all quarters.3.6 BP Venezuela’s Indigenous Relationships TodayThe recent opening of petroleum exploration concessions in Venezuela has allowed BP toestablish an exploration presence on traditional Warao territory in the Delta-Amacuro area. Thecompany has commissioned research to enable better understanding of the Warao and has madeeffective efforts to establish meaningful relationships with them.As BP came to understand the dire conditions of the Warao, it moved very quickly to provideemergency humanitarian services through programs to assist nearby communities. Theseincluded; direct delivery of water, provision of medical and health services and construction ofmedical facilities. As well, BP is supporting NGOs such as SOCSAL that are attempting tofacilitate education, health and economic diversification initiatives for Warao people andcommunities.BP has taken the additional steps of consulting with other BP operations that work on Indigenouslands, in order to learn from their experience. BP’s operations in Alaska and in Papua NewGuinea have strongly recommended that actions be based on a consultative process with localpeoples. We also note that BP has established a staff position to coordinate Indigenous programsand has enabled this person to attend various national and international conferences andworkshops to gather information. Another progressive action by BP is the development of a draftpolicy statement on Indigenous Policy 11.We also noted strong goal alignment within the BP Venezuela organization around “doing theright thing with respect to the Warao people”. This sentiment, which was originally expressed tous by BP Venezuela President Ellis Armstrong, was evident in all discussions with BP personnel.This is exemplified by BP’s actions, which demonstrate a forward-looking approach andcommitted efforts to respond respectfully to a delicate situation.11 See Appendix 4 for a copy of this policy.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  18. 18. - 14 -3.6.1 Current StrategyBP Venezuela recently articulated a three point strategy for its relationship with the Warao. Thestrategy involves: 1. Gaining community trust by operating in a consultative and transparent manner while continuing with the ongoing implementation of high impact water and health programs 2. Create favourable public opinion by obtaining third party endorsements, developing strategic alliances and undertaking a communications and public relations program 3. Promote sustainable development through the development of a fisheries programme and ongoing evaluation of other economic opportunities.Additionally, BP has identified the need to: (a) continue pro-actively developing its relationships with local communities, (b) continue developing a deep understanding of Warao people (c) improve the management and measurement of social programme performance in the same way as Health Safety and Environment are currently managed and measured (d) strengthen NGO alliances.Success has been defined by BP as: “BP being wanted by the community”.We note that BP Venezuela’s progressive actions to establish sustainable relationships with theWarao peoples are echoed by Group Chief Executive, John Browne in an October 1997presentation on Corporate Responsibility in an International Context “Everywhere we work we try to contribute to the development of civil society . . . ensuring that the whole of the local community benefits from our presence, and bringing some positive energy to the development of the community and its institutions.”The recommendations presented later in this document are designed to enhance and build on BP’scurrent strategy and activities.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  19. 19. - 15 -4 GENERAL CHALLENGESBP will face many challenges as it strives to develop a long-term, mutually beneficial andinteractive relationship with the Warao people. Some key challenges that BP should be aware ofinclude: • Developing a workforce (including contractors and staff) that is able to work effectively across diverse cultural dimensions and that fully understands the importance of good relations with the Warao people and communities • Overcoming the distrust created by centuries of exploitation that the Warao have suffered at the hands of state, religious, business and other outside interests. • Managing the expectations of the Warao people. • Overcoming the Waroa peoples’ low levels of literacy and their lack of organizational and institutional capacity, in order to develop a truly inter-active dialogue and mutually beneficial relationship with them. • Overcoming Union agreements, Warao education and skill levels, and other obstacles in order to offer Warao peoples real opportunities for meaningful involvement in all aspects of BP’s operations. • Collaborating effectively with NGOs, government agencies, international actors and others involved in the development of the Warao area • Maintaining a positive public image for its relationship with the Warao and avoiding international criticism. The deplorable situation of the Warao people will not change overnight, regardless of what BP does. BP is not responsible for the current condition of the Warao, yet there is always a risk that the media and other interests will try to make that connection. • Doing all of the above in a cost effective and efficient mannerThe way forward will not be easy for BP as it strives to overcome historical issues, and organizeits activities to enable the Warao to be willing beneficiaries of BP’s presence in the region. “The cutting edge of the issue of corporate responsibility comes from the fact that circumstances don’t always make it easy for companies to operate as they would wish.” - John Browne, Oct-97While we understand that the challenges are immense, we do believe that building on BP’scurrent efforts and adopting the approach outlined in Section 6 will make the challengessurmountable.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  20. 20. - 16 -5 DEVELOPMENT TECHNOLOGYResource companies such as BP are facing new challenges in their quest to harvest resourcesefficiently and responsibly. They must learn to collaborate across diverse cultural andgeographical dimensions, while at the same time balancing social and environmentalresponsibility with short term profitability and long term growth. And they must do this underincreasing public scrutiny and with constantly shifting commodity prices. Wayne Dunn &Associates has constructed an analytical framework called Development Technology, to supportresource companies’ efforts to meet these new challenges.5.1 What is Development Technology?Development Technology is an analytical framework and a three pronged strategy developed byWayne Dunn & Associates to assist resource companies to meet these new challenges in arational and cost-effective manner.5.1.1 Analytical FrameworkThe key elements of a Development Technology analytical framework are outlined below.Additional information on the elements, and a discussion on their applicability to BP’srelationship with the Warao peoples, is included in the following sub-sections. 1. Does the corporate ethos facilitate working effectively across diverse cultures 2. Does the company organize normal ongoing activities and operations in a way that provides meaningful benefits to local people and communities in an efficient and cost effective manner. The analysis involves sifting contracting, purchasing, hiring and other activities through a screen of questions such as: • How much local hiring is done and how can it be increased? • What, if anything, needs to be done (i.e. health, education, union agreements, hiring processes, etc.) to eliminate barriers which prevent local people from becoming productively involved in the project? • Can others (governments, development agencies, etc.) be influenced to collaborate in maximizing local benefits, or influenced to undertake supportive development activities on their own? • Given the timeframe of the development, what sorts of education and training initiatives will best enable local people to be productively involved in the project? • Can local suppliers be developed for the goods and services the project will need? • Can contracts and subcontracts be organized to provide more local benefits and more opportunities for productive local involvement?BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  21. 21. - 17 - 3. Does the current process of measuring and monitoring the impact that operations and activities have on the community effectively support the corporation’s community relations objectives.5.1.2 StrategyThe three key elements of a Development Technology strategy are outlined below. 1. Developing a corporate ethos that facilitates working effectively across diverse cultures 2. Understanding and deploying a set of tools to enhance local relationships by cost effectively and sustainably increasing benefits accruing to local interests. These tools are: a) Humanitarian Assistance/Direct Grants b) Leverage/Influence with Third Parties c) Training & Education d) Employment e) Procurement 3. Measuring and monitoring the impact that operations and activities have on the community and using the information to implement a continuous improvement process.An analysis based on the Development Technology analytical framework is contained in thefollowing subsections and the resulting strategy and implementation plan is outlined in Section 6.5.2 Corporate Ethos: The Development Technology FoundationCompanies wishing to prosper in today’s global village economy must have the ability to workeffectively in diverse cultural settings. This is especially true for resource companies operatingon lands where the traditional Indigenous inhabitants are severely marginalized and suffer from ahistory of exploitation. Companies in this situation, even those with the best of intentions, areoften unable to develop effective relationships with local peoples.Many corporations and their personnel are prone to making broad cultural generalizations on thebasis of their own educational and experiential background. These generalizations are often madewith the best of intentions, and are the result of a limited scope and understanding of othercultures and perspectives. Should these generalizations continue unchecked they will reflectpoorly on the company and impair chances for maintaining sustainable, mutually beneficialrelationships. For a company such as BP to work effectively in an area like the Orinoco Delta itis imperative that all personnel (including sub-contract staff) have an understanding of crosscultural issues and an understanding of the importance of maintaining good relationships with theBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  22. 22. - 18 -Warao peoples. In order to have the pan-operation goal alignment that is necessary to maintaingood Warao relationships, every employee should receive exposure to cross cultural training andunderstand the importance of Indigenous relationships, much the same as every BP employeenow receives some level of environmental education and security awareness. Good localrelationships are the result of all departments and units understanding and contributing to theprocess.The effectiveness of any development technology tool depends greatly on the attitude andapproach that is used when implementing it. If people who are well versed in cross culturalcommunications practices, use the tools with a genuine attitude of mutual respect andcollaboration, they will tend to be effective. However, if they are deployed with a sense of pityand guilt, by people who see themselves ‘saving’ the poor Indigenous peoples, the tools will havelittle long term positive impact.5.3 Development Technology Tools:The following sub-sections will look at the various development technology tools available toresource companies and discuss their appropriateness for use by BP in its relationship with theWarao peoples. A summary Table at the conclusion of this section will compare the tools alongkey performance dimensions. It is worth reiterating that the tools are externally focused and willachieve sub-optimal results unless they are based on a strong corporate foundation of crosscultural sensitivity. Detailed recommendations on the utilization of the tools are contained inSection 6.5.3.1 Humanitarian Assistance/Direct GrantsOften companies see humanitarian aid (financial donations, health programs, supportingcommunity charities, etc.) as the key tool that can provide benefits to severely marginalizedcommunities. While humanitarian aid and direct grants are often necessary to resolve immediateconcerns, the impact is generally temporary and unsustainable. On their own, humanitarian aidand grants will not develop the mutually beneficial, interactive collaboration that BP is seekingto develop with Warao people and communities.While humanitarian aid is often a necessary starting point, by its very nature it is unsustainableand demeaning to its recipients. Programs are often delivered with a paternalistic approach thatfosters further dependency and endless expectations. A primary aim of humanitarian assistanceshould be to support efforts to enable improved application of the other, more sustainable tools.Carrying out humanitarian and charitable programs, without providing local people withopportunities to be productively involved (i.e. employed or supplying goods and services) isdemeaning, unsustainable and, in the long term, will foster resentment and ill will. No one,regardless of cultural background, wants to simply receive charity. Minimizing or dismissing theuse of the other tools (employment, training, procurement) deprives both the company and thecommunities of the more sustainable (and cost effective) benefits that they can provide 12.12 This is not to say that humanitarian and charitable programs should not be used – only that one must be aware thatother tools can better produce sustainable long-term benefits.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  23. 23. - 19 -The health and water delivery projects that BP has initiated can begin to create a foundation fromwhich other, more sustainable activities can be developed. However, BP must begin immediatelyto develop mechanisms that will ensure that those Warao who want to be productively involvedin BP’s operations will have every opportunity to do so.Program Delivery by Third PartiesIn some cases third parties such as NGOs can provide the most effective mechanism for thedelivery of humanitarian and charitable programs. Another approach is to cost share the programwith a government or other agency that has effective delivery capacity. While there is nothinginherently problematic with third party delivery, and it sometimes offers the most effectiveprogram delivery mechanism, corporations must understand the danger of relying on third partiesfor all programs.Considerations for Third Party DeliveryAlthough Indigenous issues have often surfaced through environmental considerations, there is asignificant difference between the two issues. BP should ensure that any third party deliveryagents it collaborates with on Indigenous issues have the requisite knowledge and experience indelivering Indigenous development programs. Potential collaborators should be cognizant andcomfortable with the full range of Development Technology tools.It is important that companies like BP interact directly with Warao people and communities. Thisis beneficial for BP’s image and it also provides a valuable source of direct information that willhelp BP remain knowledgeable about Warao communities and peoples.5.3.2 Leverage/Influence with Third PartiesAs John Browne noted in his November 1997 presentation to the Council on Foreign Relations inNew York, corporations have a responsibility to ensure that resource development providesdiscernible advantages for local communities. But, the reality is that corporations do not haveprimary responsibility for the well being of Indigenous and other marginalized peoples andcommunities. While there is no doubt that corporations do have responsibilities, the primaryresponsibility rests with the people themselves and with various levels of government.However, as noted in the background information, often local peoples have been marginalized forso long that they lack the institutions and capacity to exercise their responsibility effectively.And, often international organizations and national, state, municipal and other governments havenot taken the steps necessary to allow Indigenous peoples to be full partners in society.Corporations such as BP are in a position of influence with governments and other parties whohave responsibilities for Indigenous peoples. BP’s collaboration with various governmental andinternational health programs is an example of how this leverage and influence can be usedeffectively. BP has a number of other opportunities to utilize its influence to assist the Warao intheir development efforts. Of significant importance is BP’s ability to require its contractors andagents to develop an understanding of the Warao peoples and to organize their activities in waysthat can produce tangible benefits for the Warao peoples.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  24. 24. - 20 -5.3.3 Training & Education We will only have true development and full human rights when individuals have freedom from poverty and the freedom to develop their skills, as well as the freedom to express their views. - John Browne, Oct-97Training and Education provide the capacity that enables that freedom. Illiteracy and lack ofeducational opportunities are characteristic of the Warao people and communities. In communityafter community few children attend school for longer than two or three years and the effectiveilliteracy rate is close to 100%. Corporations that are working to establish mutually beneficialrelationships with these communities must support education and training for all ages. Educationand training are absolutely necessary to support long term capacity development.Education and training initiatives, especially in the case of the Warao, should occur along a rangeof dimensions. Working in cooperation with existing educational institutions, the facilities andresources to support and encourage the basic education of Warao must be put in place. This is anexcellent example of where BP can use its leverage and influence with others (governments,development agencies and donor countries and NGOs) to supplement BP’s own resources.Education and training initiatives that will assist the Warao peoples in their daily activities shouldbe encouraged and supported. As well, BP must develop and implement training initiatives thatwill ensure that those Warao who want to be productively involved in BP’s activities, will havean opportunity to acquire the capacity that will allow them to do so. Additionally, as BP beginsto have more local people productively involved in its activities, it should consider providingthem with ongoing training and educational opportunities such as offering adult basic educationat the jobsite.Currently, due to a number of factors including lack of financial support, almost no Warao go onto take advanced education and training. If there is to be a sustainable, long term change in thesituation of the Warao peoples, they will require well educated leaders. BP could facilitate thisprocess through a scholarship program targeted at encouraging Warao people to pursue advancedstudies and training.5.3.4 EmploymentHiring of local people must be a key tool in any corporation’s community relations strategy.Unfortunately, especially in the case of remote Indigenous communities, hiring is oftenoverlooked or deliberately discouraged. It is often assumed (many times on the basis of casualconversations and anecdotal information) that Indigenous peoples just want to continue theirtraditional lifestyles and are not interested in employment. This is a risky and expensiveassumption that has been proven wrong many times. While it is true that many Indigenouspeople will want to continue traditional lifestyles, there will be some who will want to beproductively employed in the industry. And, as has been demonstrated over and over again inCanada and elsewhere, resource industry employment and traditional Indigenous lifestyles are notmutually exclusive.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  25. 25. - 21 -Hiring and recruitment efforts are also a very cost effective and sustainable way to provide localbenefits (see Table 1 Section 5.3.7 for a detailed comparison of the tools). Unlike humanitarianaid, where benefits are generally unsustainable and on a one to one ratio with expenditures (i.e.every dollar spent on the program produces a dollar of community benefit) local hiring programsare incremental in nature, producing benefits that outlast and greatly exceed programexpenditures. A local employment strategy will not produce overnight results, but it will producesustainable, long term results. This is precisely why it should begin in the early stages of aproject and have measurable objectives.Pre-Employment Training ProgramsPre-employment training programs have proven to be an effective strategy to bring prospectiveemployees up to required educational standards and provide corporations with a qualified poolfrom which to draw new recruits. Additionally these programs provide a pre-screeningmechanism to ensure that investments in employee training are directed at those people mostlikely to continue working with the company over time.Often resource companies operating in remote regions will be providing people with theirfirst-ever salaried employment. A pre-employment training program helps potential recruitsachieve a position where they are prepared to begin employment. Potential employees arebrought together in a situation that is as similar as possible to the real work environment. Whiletogether they undertake necessary training, upgrading and orientation. Pre-orientation trainingprogram elements often include: • Adult Basic Education • Life Skills Training • First Aid and Safety Training • Visits to appropriate worksites • Family awareness (bringing other family members to orient them on the realities of having a family member involved in salaried employment)Some companies have found that pre-employment training programs have more than doubledtheir ability to hire people from local, marginalized communities. As well, they have found thatthe turnover rate for employees regularly drops by more than 50%, because prospectiveemployees have an opportunity to learn more about the reality of the work situation and manywho would not remain employed self-select out of the program.5.3.5 ProcurementDeveloping local suppliers of goods and services in remote, marginalized and under-developedcommunities is generally very difficult. But, it is a necessary and vitally important component ofany development technology strategy.Resource companies regularly procure millions of dollars worth of goods and services for thedevelopment and operation of a project. These purchases have the potential to produce animmediate impact on local economies. And, over the longer term they can help the localBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  26. 26. - 22 -economy develop the capacity to capitalize on the roads, airports and other local infrastructureimprovements that often accompany resource development. For example, an improved airportand increased local activity may create opportunities to develop tourism businesses. However, ifthe local economy does not have sufficient business capacity, it is unlikely that a local interestwill be able to capitalize on opportunities like this. A local procurement strategy can, over time,create the capacity in the local economy to develop new business opportunities that are notdirectly dependent on the resource industry.Unfortunately, many companies overlook or discount the potential to develop local suppliers ofgoods and services. Often local communities, like the Warao, are marginalized and have noimmediately evident capacity to supply goods and services. Seldom are the people involved inprocurement activities given the tools or the encouragement to develop local suppliers. As well,in the short run it may well be easier and less expensive to procure goods and services fromtraditional sources. Additionally, as with employment, the assumption is often made thatIndigenous peoples would sooner maintain their traditional lifestyles and are generally notinterested in supplying goods and services to resource industries. This assumption is risky,expensive and false. A strategy of increasing local procurement will pay off, regardless of thelocal people’s initial capacity to supply goods and services.A Local Procurement Success StoryCameco, a gold and uranium mining company, was able to move from zero to approximately $75million in local procurement over a ten year period. Ten years ago, Cameco’s was purchasingalmost no goods and services from local suppliers for its operations in northern Saskatchewan,Canada. There were minimal local business capacity and high rates of illiteracy in the isolatedlocal Indigenous communities. But, with a focused effort and a long term strategy, Cameco isnow purchasing close to $75 million in goods and services from northern Saskatchewan’s 33,000inhabitants (75% of whom are Indigenous). At the same time, Cameco has increased its localhiring to the point where 86% of new employees are local residents. The company employs over500 local Indigenous people, paying them over $20 million/year in salaries. All this wasaccomplished in a remote, isolated area where, initially, the people were largely untrained andunskilled and living traditional lifestyles. We will recommend that BP arrange a visit toCameco’s Saskatchewan operations to identify specific elements of Cameco’s programs thatcould be applicable to BP’s operations in Venezuela and elsewhere.Admittedly, there are many differences between the Cree and Dené of northern Saskatchewan andthe Warao of the Orinoco Delta. But, there are also many similarities. Indigenous peoples inboth places have experienced exploitation and marginalization over long periods of time. Byaccepted measurements their development was far below that of the surrounding non-Indigenouscommunity. Both peoples had almost no previous positive experience with business or industry.Cameco realized that investing in local procurement and employment programs was a costeffective deployment of community relations spending. Dollar for dollar, spending to increaselocal procurement and employment can have a much larger and longer term impact on localeconomies than humanitarian and charitable spending.Local procurement and joint-venturesJoint venturing with partners who have the necessary capacity and operational expertise hasproven to be an effective way for some Indigenous peoples to provide goods and services toresource projects. Cameco has promoted the use of this strategy effectively, helping to bring theBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  27. 27. - 23 -partners together and facilitate arrangements. This has allowed them to award multi-milliondollar underground mining, catering, transportation and other contracts to Indigenous businessesthat had little previous experience in these sectors.The current level of Warao institutional and organizational capacity will be a limiting factor inallowing near term development of joint ventures. However, by focusing on opportunities ratherthan constraints, it may be possible to identify an opportunity whereby a joint venture approachcould assist in developing a Warao supplier. Given the Warao peoples’ proven expertise in livingeffectively in the region, BP may want to examine its environmental monitoring and managementactivities to determine if there is an opportunity to allow for direct Warao involvement.If companies such as BP are to ensure that resource development occurs in a mutually beneficialmanner, increasing local procurement is both necessary and cost effective. Furthermore, five orten years into the development of the field it would be very difficult to justify why local Waraopeoples were not involved in providing goods and services.5.3.6 Other ToolsIn addition to the tools listed previously, there are a number of additional activities and strategiesthat will help local resource projects to produce long term, sustainable benefits for localcommunities and people. We will be recommending that BP utilize some of the following toolsto enhance its relationship with the Warao peoples.Capacity BuildingIncreasing local organizational and institutional capacity is absolutely necessary in order to havea long term, interactive relationship with local Warao communities.Mechanism(s) to facilitate local involvement and benefitsEnsuring that resource projects produce local benefits is the responsibility of many parties, notjust the resource company. There needs to be a mechanism(s) to facilitate communication andcollaboration between the various actors. (Note that in order for this mechanism to be effectivethe participants must have a basic level of organizational and institutional capacity). Thesemechanisms can take various forms and can include a range of actors. For instance, Cameco, inits operations in the Athabasca region of Saskatchewan’s far north (which is one of the mostmarginalized areas in Canada), facilitated the creation of the Athabasca Working Group. Thisgroup brings together industry, government, community leaders and other interested parties. Itsoverall objective is utilizing the mining industry to improve 13 life in the communities. Amongother results, in the 3 years since the group was formed there has been a 60% increase in localemployment.5.3.7 Comparing the ToolsThere is an appropriate time and situation for each of the Development Technology toolsdiscussed previously. Often the impact can be increased, by utilizing the tools together, or by13 The communities themselves are the only ones that can legitimately define what improvement means.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  28. 28. - 24 -using one to build the capacity to enable the effective use of others (i.e. supporting basic healthand education to increase the impact of later training, hiring and procurement efforts). What isimportant is to understand the impact of the tools along several key dimensions. The followingchart will illustrate the aspects of the various dimensions. Table 1, a matrix that compares thedevelopment technology tools across the impact dimensions follows this chart.Self Sustaining: Will the initiative generated by the tool eventually be self-sustaining, or will it require ongoing investment from the company or others?Enhances Self Esteem: Will the impact created by the use of the tool enhance individual and community self esteem?Builds Capacity: Does the tool help to build sustainable long term capacityBuilds Partnership: Is the initiative inter-active enough that it creates a sense of partnership with the local people and community?Return on Investment: What is the value of community benefits per dollar invested?BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  29. 29. - 25 -Table 1 A Comparison of Development Technology Tools Self Sustaining Enhances Self Esteem Builds Capacity Builds Partnership Return on InvestmentHumanitarian aid No, but often necessary In the short term it can in In the short term Can build initial sense of Low, with little or noand Direct Grants initially in order to some situations, but often perhaps, but not long partnership and trust if leverage. Return usually create a foundation for it will foster long term term sustainable designed and ceases when contribution the successful dependency capacity. Also it has a implemented finishes implementation of other tendency to foster appropriately tools dependencyLeverage/Influence Can be if the influence Can if appropriate Can if activities of third Can, if leverage is done Can be high if influencewith Third Parties causes third parties to activities are undertaken parties are appropriate collaboratively with results in third party adopt and implement (i.e. legislation, local people and based investment in new activities sustainable long term development actions, etc.) on community priorities that provide ongoing approaches community benefitsTraining No, but when trained Yes Yes Can, especially if High. Small investment in people can go on to development and training can produce other self sustaining selection is undertaken ongoing return through activities with community continued employment collaboration.Hiring Yes Yes Yes Yes High – small investment to increase local hiring can produce ongoing salary revenues into community economyProcurement Yes Yes Yes – especially if Yes Very high procurement activities are designed to increase local business capacityBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  30. 30. - 26 -5.4 Development Technology Results: Measuring the Impact “(W)hat gets measured gets done” - John Browne, 17-Nov-97, New YorkIn the past 15 years resource companies have made great strides in their ability to measure,monitor and mitigate their impact on the environment. Companies have accepted that theiractivities will impact the natural environment and that there is a responsibility to mitigate anynegative impacts. In order to effectively manage this responsibility it has been necessary todevelop new technologies to enable more effective measurement of environmental impacts.Resource companies routinely accept that they must file environmental impact assessments thatpredict, in minute detail, what impact their extraction operations will have on the surroundingnatural environment. Yet, these same companies are often unable to produce quantitativeestimates of the impact their operations will have on surrounding communities and people. Manydon’t even keep records of local hiring and purchases.If BP is to successfully meet the challenge of producing energy in ways that enhance the life ofthe community as a whole, community impacts must be monitored and measured with the samefocus as environmental impacts. BP and its contractors and agents must be prepared toquantitatively answer questions dealing with changes to community health, employment,business, etc. that emanate from resource exploration and extraction. This will mean thecollection of baseline data on communities prior to the onset of activity, much the same way thatbaseline data is now collected on the environment. It may well be necessary to develop newmeasuring and monitoring technologies.Targets will have to be set in various community impact areas (health, education, employment,training, procurement, etc.) and progress towards those targets monitored and evaluated.Managers and sub-contractors will have to be judged on their community impact as well as alongfinancial, environmental, safety and other dimensions.If BP wishes to maximize the impact of its investment in community relations it must developand implement a comprehensive program that will set community impact targets and regularlymonitor and reward progress towards those targets.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  31. 31. - 27 -6 ISSUES, STRATEGY & RECOMMENDATIONS6.1 StrategyBased on the research and analysis carried out, we recommend adoption of the following strategyto enable BP Venezuela to achieve its objective of developing sustainable and mutually beneficialrelations with the Warao peoples in an efficient and cost effective manner. To cost effectively and efficiently organize exploration activities so that they support BP’s social responsibility objectives of contributing to the development of civil society, environmental responsibility and maximizing the sustainable benefits received by local interests.The following recommendations build upon the progressive work already undertaken by BP andconstitute an implementation program for the strategy articulated previously. An implementationmatrix following the recommendations provides summary information on recommendations andimplementation. There is a high degree of inter-connectivity between the variousrecommendations and individual tasks are sometimes related to more than one recommendation.Section 7 outlines a short term work plan that identifies tasks necessary to begin implementationof the various recommendations.The recommendations are organized along the Development Technology analytical frameworkdiscussed in the previous section. All recommendations are organized with a specificrecommendation, rationale, implementation strategy and a time frame. The time frame is basedon the following parameters • Short Term less than 1 year • Medium Term 1-3 years • Long Term more than 3 yearsWhere appropriate, special considerations have been noted for each recommendation.BP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  32. 32. - 28 -6.2 Enhancing the Corporate EthosIssue 1: BP requires that all Personnel are able to work effectively in sensitive Cross Cultural situationsRecommendation Develop and implement an ongoing Cross Cultural Communications and Sensitivity training programRationale Many corporations and their personnel are prone to making broad cultural generalizations on the basis of their own educational and experiential background. These generalizations are often made with the best of intentions, and are the result of a limited scope and understanding of other cultures and perspectives. Should these generalizations continue unchecked they can reflect poorly on the company and inhibit its ability to work effectively across diverse cultural dimensions. Personnel at all levels must have a basic cross cultural sensitivity in order for companies to work effectively in diverse cultural settingsImplementation 1. Engage a cross-cultural consultancy firm to assist with the design,Strategy development and implementation of a comprehensive Cross-Cultural Training and Sensitization program with the following characteristics: • The program should be designed in a modular fashion in order to accommodate the specific requirements of the various users and permit easy adaptation for other Indigenous peoples in other BP operations • It should be designed so that BP personnel can be trained to deliver it on a regular basis. • It should be scalable so it is effective for personnel with varying levels of cross cultural interaction (i.e. someone working in the field directly with Indigenous peoples will need a different level of training than someone in corporate finance or someone who is only going to have short term inter-actions) • It should have components and materials that can be utilized as part of regular briefing processes • There should be a package of materials that is designed to complement the modular and scaleable program • It should utilize local Indigenous peoples to enhance the deliveryBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  33. 33. - 29 - 2. When developed it should be mandatory for all personnel, including contractors and their staff, to take the appropriate level briefing.Timeframe 1. Begin program development as soon as possible. 2. When a basic program is developed begin training BP trainers and delivering the program to appropriate personnel. 3. With feedback from the initial delivery refine and enhance various modules as appropriateBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably
  34. 34. - 30 -Issue 2: BP has a considerable internal knowledge base on Indigenous information, but the information is not coordinated and requires ongoing enhancement and updatingRecommendation BP should consolidate its existing internal knowledge base on Indigenous issues and continue expanding and enhancing it.Rationale A current and comprehensive knowledge base on Indigenous issues and developments, both in Venezuela and throughout the world, is necessary for an organization that wants to work effectively with Indigenous peoples. Indigenous issues are complex and have multiple historic roots. Currently, BP has a good internal information and knowledge base, but the information does not permeate the organization and it requires enhancement in key areas. (the communications strategy [Recommendation 3] will deal with socializing Indigenous information throughout the organization)Implementation 1. Identify key persons in each unit dealing directly with Indigenous issuesStrategy and ensure that they are aware of all Indigenous information and that information is actively shared across units. 2. Continue building and enhancing the knowledge base through regular interaction with Indigenous peoples and organizations. 3. Develop an online directory that catalogs various documents and reports on Indigenous peoples and issues and indicates how to access them 4. Encourage regular information sharing with other BP Assets that deal with Indigenous Peoples 5. Contract a third party to provide regular briefings on international Indigenous issues and activities, including policies and actions of multi- lateral and international organizations (this will be much more cost effective than attempting to remain up to date on these activities internally and will significantly extend the scope of BP’s information gathering capacity) 6. Attend pertinent conferences, meetings and other sessions on or relating to Indigenous issues. The contractor in Item 5 above, can help to identify appropriate events to attend, and if necessary, could attend them directly and then brief appropriate BP Personnel. Also, it may be worthwhile to attend some meetings, such as the UN Working Group on Indigenous Affairs, with the contractor or someone who has contacts and experience in these forums.Time Frame Short term and ongoingBP VENEZUELA March 1998Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

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