Companies ill-prepared to respect indigenous rights in Arctic, study finds

With the temperature at the top of the world rising and demand for natural resources accelerating, the extractive industry is moving farther northward. As oil, gas, and mining companies begin to operate in the Arctic, they often encounter indigenous peoples. The Saami in northern Fennoscandia, Nenets reindeer herders in Russia, and Inuit peoples from Alaska to Greenland are just a few of the 40 different indigenous groups who inhabit the tundra and taiga of the Earth’s resource-rich northern lands.

In much of the Arctic, indigenous peoples still pursue traditional activities like hunting, fishing, and reindeer herding. Some are therefore understandably opposed to the arrival of the extractive industry, with its destructive open-pit mines and noisy drillships. At the same time, many groups like Canada’s Inuvialuit and Alaska’s Inupiat are also deeply engaged in extraction themselves, running their own oil and gas companies and operating mines. They also seek to attract outside investment to stimulate their local economies and enhance regional development.

Yet it is not clear that these companies, whether from inside or outside the Arctic, will pay heed to indigenous rights. A new report authored by Dr. Indra Overland of the Norwegian Institute of International Affairs reveals that more than 60 percent of companies operating in the Arctic are unprepared to respect indigenous rights. Entitled Ranking Oil, Gas and Mining Companies on Indigenous Rights in the Arctic, the report assesses public commitments, formalized procedures, and institutional arrangements rather than companies’ actual behaviors and operations. 92 different companies were assessed for how well they adhere to 20 different criteria, which include having formal procedures for consulting with indigenous peoples and making commitments to international standards.

Geographically, companies in the U.S. (Alaska) and Canada performed the best. This may speak to the fairly strong legal system that protects indigenous rights in both countries, along with norms of corporate social responsibility that increasingly demand respect for indigenous peoples. While there were quite a few companies in Russia that fell towards the bottom, a number of Russian companies performed well, too.

A Danish disappointment

The country with the biggest proportion of poorly performing countries was Denmark/Greenland: in fact, all of the companies operating in Greenland fell into the bottom two-thirds of the ranking. Norway, too, had a high degree of overrepresentation in this unenviable category, with 88% of its companies in this category. Ironically, Denmark and Norway are the only two Arctic countries that have ratified International Labor Organisation (ILO) 169 on Indigenous and Tribal Peoples, one of the most important international laws protecting the rights of indigenous peoples, while the U.S. and Canada have not. This suggests that actions speak louder than words, or, in this case, treaty ratifications. Simply because the Danish and Norwegian governments have signed onto global standards does not mean that they are creating legal environments where companies operating within their borders are respecting indigenous peoples.

By sector, oil and gas companies scored higher than mining companies on average. The report suggests that the higher performance of fossil fuel corporations like Total, which came in second place out of 92 companies, and Statoil may be due to their bigger public profiles. Whereas an often harsh media spotlight shines on multinational oil and gas companies, smaller-scale mining companies can operate more under the radar. A campaign against coal mining on Evenki lands simply isn’t as compelling to general audiences as a blanket campaign against Arctic oil.

The fact that mining companies perform poorly in general, and companies in Greenland especially so, bodes ill for future relations between Greenlandic people and the mining companies that seek to extract minerals like uranium, rubies, and rare earths from the massive Arctic island. When I was in Greenland last month, I sailed by the potential site for the Kvanefjeld uranium and rare earth minerals mine near Narsaq. One Greenlander told me that many locals were opposed to the mine because even though it might bring jobs, it would ruin the land around it, which is vital for sheep. Tailings could also pollute the glacial water.

I wrote to Dr. Overland to ask about why companies in Greenland performed so poorly, especially since the country’s population is close to 90% indigenous – far more than any other Arctic country. He responded,

“I am not sure. As with most social issues there are probably multiple factors involved. I can only propose some possible factors at a hypothetical level: perhaps there is a colonial attitude towards Greenland, since it is more remote from Denmark than the indigenous territories of the other polar states; perhaps there is a sense that nobody lives there, so rights don’t matter; perhaps the Danes have come to rest on the laurels of their ratification of ILO 169; perhaps the companies operating on Greenland are not so bad, just not very explicit about how they relate to indigenous rights.”

Indeed, this last point about companies not being particularly explicit about how they relate to indigenous rights is a possibility. After all, while Alaska Native Regional Corporations, which Alaska Native peoples own, generally performed quite highly, some were lower down the list than one might expect such as NANA Development Corporation, which owns the Red Dog Mine in Alaska. Dr. Overland suggested,

“I noticed with some companies that are closely connected with indigenous peoples they scored lowly because they took their position on indigenous rights for granted. For example, if a company is owned or partly owned by an indigenous people, it may not feel there is a great need to talk about how it is going to uphold the rights of indigenous peoples. This could be that case with some of these corporations.”

To clarify how companies actually engage with indigenous peoples in the places they are operating whether or not they are owned by indigenous peoples, future research could assess the actual practices of the extractive industry at large. This would entail a massive research effort, as Dr. Overland pointed out, with visits to various extraction sites around the Arctic and discussions with both indigenous peoples and corporate representatives. Yet he is not very optimistic about the potential results of such a study. He noted, “Since it is easier for a company to say that it will uphold a standard than to actually do it, I guess the picture would be even bleaker.”

Creating a new race in the Arctic

The ultimate aim with the report’s ranking is not just to create yet another list. It’s to generate real, substantive change in the way companies engage with indigenous peoples by harnessing the forces companies know best: competition. If a company sees that it falls towards the bottom of this list – a title which currently falls to Yamalzoloto, a gold mining company in Russia – it may seek to move up a few rungs. Overland offered:

“In this way a ranking goes further than a law. A law is fulfilled or it is not fulfilled. In a ranking, there are also winners and losers and the losers can always try to improve their position. The aim to create a never-ending race to improve standards on indigenous rights.”

In short, if ILO 169 is not really working to improve respect towards indigenous rights in the Arctic, creating a race for rankings may be worth a shot.