Impact and Benefit Agreements: Tools for Sustainable Development?

by Kevin O'Reilly

In this issue of Northern Perspectives we examine impact and benefit agreements (IBAs) and their implications for Aboriginal peoples, mineral development, and sustainability.
IBAs are small but powerful arrangements between Aboriginal communities and developers that have been used increasingly to achieve greater self-determination. Manifestations of the struggle to achieve balance between local and outside interests, they generally contribute to lasting local benefits, greater diversification of local economies, and better prospects for sustainability while minimizing negative impacts of resource development. In some cases, signed land-rights agreements require negotiation of IBAs. In the absence of such agreements, the capacity of a community to bring the developer to the table and the goodwill of the developer will affect the quality of the IBA.
For three decades, with concerns rooted in notions of equity and sustainability, CARC has supported northerners in their struggle to achieve greater self-determination through land-rights settlements, Aboriginal self-government, and constitutional development. We became involved in IBAs when representatives of Aboriginal peoples from across northern Canada came to Ottawa in April 1996 to share their experiences with mining issues at a workshop component of CARC's Northern Minerals Programme. IBAs were one of the major themes to emerge from that session, and participants expressed their desire for another forum in which to discuss the topic further.
CARC asked Janet Keeping of the Canadian Institute of Resources Law in Calgary to prepare a background report comparing several IBAs. It was included in an extensive advance resource kit sent to participants at an IBA-specific workshop held at Yellowknife in May 1998. The participants asked CARC to summarize the discussions at that workshop for broader distribution through this special issue of Northern Perspectives.
The workshop raised several important issues:
We asked Janet Keeping also to write on the legal and constitutional basis for IBAs in the Northwest Territories. Janet's overview reveals startling inconsistencies in the degree to which Aboriginal peoples benefit from developments that depend on the type of mineral resource extraction (hydrocarbons versus base and precious metals, or diamonds) and whether Aboriginal land rights have been settled. It is clearly not in the public interest to continue a regime that allows communities to become pitted against each other and that results in uncertainty and lack of clarity for industry.
Ciaran O'Faircheallaigh, a Professor at Griffith University in Brisbane, Australia, contributes a concise review of Australian Aboriginal experience with IBAs for this issue of Northern Perspectives. As in Canada, there is a large variation in Australia in the complexity of IBAs, the capacity of communities to negotiate agreements, and the willingness of developers to "share the wealth." Several mining companies-e.g., Rio Tinto and Broken Hill Proprietary (BHP)- operate in both Australia and Canada. Much of the Aboriginal effort in Australia is in defining the context for IBAs, as is the case in Canada. Finally, more generous agreements-perhaps because of some initial strong judicial decisions in favour of Aboriginal rights-seem to have been negotiated in Australia than in Canada.
IBAs continue to generate controversy despite a trend towards their increasing acceptance as the industry norm and notwithstanding that they have become a legal requirement in many areas where land claims have been settled. The Labrador Inuit Association and the Innu Nation are challenging the federal government's rejection of a Voisey's Bay Panel recommendation that there should be signed IBAs before the project proceeds. At the time of writing, Diavik had not begun to seriously negotiate IBAs with at least five Aboriginal governments although it pressed ahead for government approval for Canada's second diamond mine. Will the new Minister of Indian Affairs and Northern Development require "signed agreements" before Diavik proceeds, or will the result mirror the abysmal process applied to BHP's Ekati diamond mine, where "significant progress" was necessary in an extremely tight timeframe with limited capacity and access to resources for Aboriginal governments expected to negotiate several arrangements all at the same time?
IBAs fly in the face of global trends such as free trade, the free flow of capital, and less regulation. Governments in Canada have been reluctant to support IBAs' role as tools for sustainability, especially where Aboriginal communities are without land-rights agreements. What then is the proper role of government in relation to IBAs? What is the proper relationship between public regulatory systems and privately negotiated IBAs?
This issue of Northern Perspectives ties together some important work and creative thinking on IBAs carried out over the last few years. The last issue highlighted a need to reform mining law in Canada to protect the environment and human health and to ensure that those communities most affected retain benefits. Land-rights agreements are most effective and provide the most appropriate place to balance the needs of Aboriginal peoples and public institutions, but in their absence a level playing field is essential for effective IBAs. Government needs to support communities in their efforts to negotiate with developers. Financial assistance, reform of mining law to require benefits agreements (as is already the case for hydrocarbon developments), and disallowance of confidentiality or non-disclosure requirements should be considered. Industry will benefit through better working relationships with northern communities, a commitment made under the Whitehorse Mining Initiative. Together, these efforts will contribute to diversified local economies for northern communities and more sustainable economic development.
Endnote
1. The full report of the workshop is available from CARC's Yellowknife office as:
O'Reilly, Kevin and Erin Eacott. 1998. Aboriginal Peoples and Impact and Benefit Agreements: Report of a National Workshop. Northern Minerals Programme Working Paper 7. 
Kevin O'Reilly is CARC's Research Director working out of the Yellowknife office.

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