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Trust between industry and indigenous communities - from myth to reality

18 january 2021

On January 1, 2021, the diversified mining giant Rio Tinto officially changed its CEO. Jakob Stausholm took up this high position. The unplanned rotation was caused by the destruction of an ancient aboriginal sacred cave in the Juukan Gorge.

Most of the assets of large industrial companies are located close to indigenous communities. Thus, the active industrial development of natural resources in different parts of our planet cannot but have an impact on the indigenous minorities living in these areas.

At present, giant companies in the global industry are increasingly focused on the trust between the local communities and business, on the ‘green economy’, sustainable regional development, and in particular, on strengthening the local communities’ role in the business development.

In this regard, the companies are increasingly aimed at attracting the local people to their business, strengthening their relations with the native population. They set themselves the task of preserving the local ethnic groups and national heritage.

At least, that’s what the companies’ charters say, but is it really so? Using the examples of the major companies in the primary industry, such as Rio Tinto, Glencore, BHP, ALROSA, Norilsk Nickel, we will discuss whether business can really coexist harmoniously and develop trusting relationships with the indigenous communities.

Let’s start with the Australian-British Rio Tinto, one of the world’s leading diversified mining companies in terms of their market capitalization. The company recently dominated news headlines due to the historic site destruction scandal in Western Australia. These sites were reported to be of value to the indigenous people. Because of this incident, Rio Tinto had to change their management - from January 1, the company has a new CEO. Of course, this mining giant apologized to the local native people and promised to rethink its practices of interacting with the local communities. However, an apology was not enough and Rio Tinto is also going to pay compensation to the indigenous Australians who suffered due to the destruction of two ancient caves because of the company’s intention to expand their iron ore mine.

In this way, Rio Tinto shows their respect for the local communities and commitment to the company’s social development practices aimed to protect the local attractions and community, as well as to minimize the negative environmental impact of the company’s activities.

Earlier, it was reported that in order to expand its iron ore mine Rio Tinto destroyed the ancient aboriginal caves in the Juukan Gorge in March that are considered as the evidence of human habitation on the continent 46 thousand years ago - during the last ice age.

Despite this incident, the company still strives to develop a relationship of trust with the communities where it operates: it actively interacts with the local communities and consults with the government agencies, religious institutions, national and local museums and cultural institutions, as well as the scientists and NGOs.

“We consider it important to consult with all of them [institutions] and develop relationships based on mutual respect and trust,” the company’s website says.

Throughout the projects, the company works with the local communities as the interests of these communities in relation to their cultural heritage may change over time, and new ones may appear due to new developments or processes. For example, Rio Tinto introduced a cultural heritage management system at the Oyu Tolgoi gold and copper mine in Mongolia to fulfill the company’s obligations for cultural heritage management. The system describes various processes that ensure the management and protection of the tangible and intangible cultural heritage.

Another international giant, the Swiss-based GLENCORE company, one of the world’s largest commodity suppliers, is also active with indigenous groups.

The company operates in accordance with the International Council on Mining and Metals (ICMM) recommendations on indigenous peoples and the mining industry, which require that mining projects located on the areas traditionally owned by indigenous communities or are in their regular use should respect for the rights, interests of the indigenous peoples, their special ties with the land and waters.

The local communities close to the company’s assets are actively involved in the decision-making process related to the use of new land plots. This helps Glencore to strengthen its position and both provide and obtain benefit from the Company’s sustainable development.

In particular, the company has implemented the Tamatumani project for the Inuits, a group of indigenous people who live in Nunavik, Quebec, where the company operates the Raglan nickel mine. Within the framework of the project, the enterprise has contributed to the creation of permanent jobs for the Inuits, the development of their individual and professional skills, and the long-term economic development of Nunavik.

Halfway around the world, Australian Diversified Building Services (DBS), a company owned by the indigenous peoples, and Glencore Coal, a division of Glencore, have teamed up to expand an Indigenous employment programme in central Queensland, Australia. The programme that started in February aims at providing the employment opportunities to an initial group of 20 indigenous Australians who have spiritual connections with the land adjacent to several Glencore coal mines.

Despite these initiatives to attract the local communities to business, the indigenous population is very sensitive to changing the boundaries of the areas where they live.

For example, it was reported not long ago that the indigenous people in the Northern Territory of Australia demanded the compensation from the local authorities for the damage caused to their sacred trees by the Glencore’s McArthur River zinc and lead mine. Local media reported that the Northern Land Council (NLC) supporting the region’s indigenous communities filed a claim for the damages to the Federal Court.

The construction of the MacArthur River mine began in 1992, and in November 2020, the local government gave the ‘green light’ to Glencore to expand the mine. According to the reports, the mine has damaged the sacred land of the indigenous ethnic groups. Glencore has not yet commented on this situation.

In its turn, Australian BHP, one of the largest mining companies, says that the indigenous peoples are important partners and stakeholders of their company. The BHP’s website states that it is committed to mutual trust, understanding and benefit, “We recognize that our activities affect the indigenous communities and we strive to work together to ensure that BHP is a reliable partner for the native peoples and that we are making a positive contribution to the enjoyment of the rights of indigenous peoples.”

In 2016, BHP established the Global Indigenous Peoples Working Group (GIPWG), which includes the representatives from all of the company’s international assets, including Minerals Australia and Minerals America. The working group is responsible for the development, management and implementation of the company’s strategy regarding the indigenous peoples and, among other things, supporting the regional groups in the development and implementation of the regional plans for working with the indigenous communities.

BHP Mitsui Coal in Poitrel, Queensland, reportedly, partnered with Mickala Mining that provides the manpower, and over three years, employed 43 aboriginal workers (over 70 percent of them were women).

In addition, the company is participating in the Second Chance for Change (SCFC) initiative aimed at providing the indigenous prisoners with long-term, sustainable employment opportunities as the company believes this will help reduce the repetition of crime. ... the participants are offered pre- and post-employment training and coaching, and they begin to work about a year before their prison term expires. The BHP’s Mt Arthur coal mine, the largest single coal site in the Hunter Valley, was one of the first to implement the concept. Sixty prisoners participated in the SCFC programme and 55 of them were indigenous. Only one of them returned to prison.

In Russia, the number of indigenous minorities of the North, Siberia and the Far East is about 50 thousand people. One of the priority tasks of the Russian enterprises is to preserve their number, traditions and areas where they live.

For example, Russian ALROSA that develops the diamond deposits in Yakutia historically pays great attention to the social responsibility. The company make its large-scale mission to develop the regions where the Company works in line with the Company’s development so that the local people are always provided with jobs and fair wages, and their life is comfortable.

ALROSA actively supports the districts (Yakut: uluses) of the ‘diamond province’ where the indigenous peoples live who have their unique history and traditions. In addition to its philanthropic assistance, the company promotes their employment (about 11.6% of the ALROSA employees are the representatives of the indigenous peoples).

The indigenous communities of the Russian North are mainly engaged in reindeer breeding. In this regard, ALROSA supports the communities involved in this type of activities. ALROSA annually holds the Reindeer Breeder’s Day, a traditional festival with national sports competitions, exhibitions of national clothes and folk crafts and reindeer, and the prize fund is 1 million roubles.

In addition, in order to preserve the traditional culture, language and arts of the indigenous minorities of the North, the company financed the construction of an ethno-cultural centre opened in the Olenek village in 2019.

Norilsk Nickel is another Russian mining and metallurgical company that is actively involved in supporting the cultural and economic development of the indigenous minorities of the North.

For a long time, Norilsk Nickel has been implementing the programme to support the indigenous minorities. The company traditionally pays great attention to this work and it supports the festivals of the indigenous minorities of the North and annually holds the ‘Big Argish’ ethnic festival.

There are 19 nationalities of the North living in the Arctic zone. Maintaining their traditional way of life, supporting the economy and culture, protecting their rights are the important tasks of the company’s social activities.

In addition, supporting the indigenous minorities of the North is foreseen by the 10-year Development Strategy of Norilsk Nickel until 2030. It provides for the preservation of their traditional way of life, supporting the economy and culture, and in particular, financing the activities aimed at preserving the environment, developing tourism, as well as the construction of social facilities and the preservation of the languages ​​of these nationalities.

It was recently reported that Norilsk Nickel and the Federal Agency for Nationalities’ Affairs of Russia have agreed on new moves to support the indigenous minorities of the North. Igor Barinov, head of the Federal Agency for Nationalities’ Affairs of Russia, emphasized that the representatives of the indigenous minorities of the North are extremely vulnerable due to their lifestyle.

“today, Norilsk Nickel is the only resource-extracting company in the country that introduced a separate point to support the representatives of the indigenous minorities of the North in its development strategy,” Barinov explained.

The agreement concluded by Norilsk Nickel with the associations of the indigenous minorities of the North is designed for five years, its funding is 2 billion roubles, and it includes over 40 action items. The support plan was developed taking into account the wishes of 36 communities living in the Far North. The new agreement with the Federal Agency for Nationalities’ Affairs of Russia will continue the company’s efforts aimed at supporting the nationalities of the North, solving their problems jointly, and respecting their rights.

Moreover, in the Krasnoyarsk Province, Norilsk Nickel has been participating in the projects to improve the quality of life of the indigenous peoples of Taimyr for many years. For example, on January 1, 2021, a department for the interaction with the indigenous minorities of Taimyr was set up at Norilsk Nickel; it will cooperate with the local government bodies, public organizations and family communities.

“Interaction with Norilsk Nickel has a very long history. There are many examples of the interaction: in the Soviet period, all villages were built with the support of the Norilsk Nickel, multistorey apartment houses in Khatanga, schools were built, and snowmobiles were bought for the indigenous minorities of the North. At present, our relationship receives a new impetus. You know, there are not so many cases in the world practice, when small ethnic groups conclude the agreements with a global company. These are single digit cases“, said Grigory Dyukarev, the chairman of the Association of Indigenous Minorities of Taimyr.

“In 2018, we approved a policy regarding the rights of the indigenous minorities of the North. It has three main provisions and provides for a regular steady constructive dialogue with the representatives of these minorities, assistance in the development of their traditional lifestyle and taking into account their views and aspirations,” said Andrey Grachyov, vice president for the Norilsk Nickel’s federal and regional programmes.

According to him, the company pays special attention to preserving the languages. With the support of the Siberian Federal University and the Federal Agency for Nationality Affairs, Norilsk Nickel implemented a project to restore the Enets script as an example of the unique cultural heritage of the Indigenous Minorities of the North, and their ABC-book was published. In 2019, the results of this work were presented at the UN. At present, 215 Enets people live in the Arctic villages of Taimyr.

Despite the fact that ‘clashes of opinions’ with the local communities’ views are still inevitable we can observe that the industrial giants are really actively contributing and investing in the social projects, because they realize that this is an integral part of their activities, and the local communities where they work should benefit from these activities.

Over time, the industry interaction with the indigenous communities and developing the trust-based relations will facilitate the social and economic development and help build a society capable of meeting any challenge.

Victoria Quiri, Correspondent of the European Bureau, Rough&Polished, Strasbourg