Indigenous peoples in mining regions: From compensation to collaboration?

This blog is part of a series labelled Unlocking Indigenous Potential in Mining Regions. The series focuses on opportunities for Indigenous-led development in regions characterised by their natural resources. 

Too often, the resource-rich territories of Indigenous communities have become a battleground – both literally and metaphorically. The unhappy history of mineral extraction – from the US Gold Rush to Africa’s diamond mines – has produced immense wealth for governments and private companies, but the process has too rarely served to improve lives and livelihoods for Indigenous communities. That is starting to change – based on new partnership models. 

The legacy of unequitable partnerships  

Today, even in the absence of direct conflict, Indigenous communities suffer poor outcomes in resource-rich regions. In OECD mining regions, such as the Pilbara, Australia and Antofagasta, Chile, Indigenous people have higher unemployment rates, poor health outcomes and higher rates of non-completion of secondary school compared to non-Indigenous communities.  They also suffer from a lack of essential community infrastructure such as clean water, power, and housing – further reducing their ability to seize the opportunities created by mining projects.  

When their needs are considered, mining companies have often treated Indigenous populations as stakeholders to be compensated rather than partners to share in the long-term development of their lands. This approach has resulted in short-lived benefits to communities, which have been left with little capacity to generate new opportunities to sustain their well-being or deploy their traditional knowledge in support of mining projects. 

Insufficient capacity building and generic policies and programs further prevent Indigenous communities from benefiting from mining compensation and development opportunities. For example, Indigenous communities and organisations tend to lack the financial and personnel capacity to access expertise necessary for negotiating on equal terms, engaging in strategic economic planning, or navigating complex land and property rights systems. 

A shift towards new opportunities and better policies 

The green transition’s increasing demand for critical minerals presents a unique opportunity to transform the role of Indigenous peoples in mining. Globally, more than half of upcoming green energy and mining projects are occurring on or near Indigenous land, opening the possibility to reposition Indigenous peoples as central beneficiaries, and key actors in developing policies, standards, and well-being opportunities. 

This effort is being supported by international policy changes, such as the adoption of Free, Prior, and Informed Consent (FPIC) – a specific right granted to Indigenous Peoples recognised in the UN Declaration on the Rights of Indigenous Peoples (UNDRIP), which requires companies and governments to obtain consent from Indigenous communities whose lands, territories and resources may be affected by projects. This international effort adds to growing national efforts to uphold Indigenous rights and self-determination, including respect for land rights, benefit sharing, and cultural preservation. Legal frameworks in countries like Canada and Australia now provide stronger protections and greater autonomy for Indigenous communities over their lands and resources. These advancements create greater opportunities for Indigenous communities to leverage their natural resources for economic growth, fostering the sustainable development of Indigenous economies. In Canada, for example, there are currently 50,000 Indigenous-owned resource management companies, demonstrating the significant impact of these policies

Companies are also increasingly focusing on ESG activities and voluntarily adhering to international and industry standards that recognise Indigenous peoples’ role in environmental stewardship and cultural preservation. This shift fosters respectful and equitable partnerships with Indigenous communities, involving them as partners and collaborators in each project. For example, the mining industry in Canada, adhering to national sustainable mining standards, has become the largest private-sector industrial employer of Indigenous peoples and a partner of Indigenous businesses, with over 500 active agreements between mining companies and Indigenous communities.  

Integrating Indigenous voices in decision-making  

Governments at all levels, along with companies, can leverage this momentum to secure a more permanent shift to enhance Indigenous well-being in mining regions. 

First, they should facilitate governance models that empower Indigenous communities to make key decisions over resource management, incorporating Indigenous knowledge and perspectives into policies. Indigenous-led resource management boards such as the Nisga’a Nation in Canada, and the involvement of Indigenous leaders in governance mechanisms and mining strategies such as in Antofagasta, Chile, are examples of successful integration.  

These approaches can also support better environmental outcomes – Indigenous communities often contribute significantly to environmental stewardship using their traditional knowledge of lands, waterways, and biodiversity. Integrating Indigenous knowledge into circular practices in mineral operations such as the collaboration to advance rehabilitation strategies between Rio Tinto and Wik-Waya landowners at the Amrun mine in Queensland, Australia, exemplifies this approach.  

Second, economic opportunities for Indigenous communities can be enhanced based on energy transition projects by co-developing policies to support Indigenous economic participation in projects, entrepreneurship, and access to capital. In Canada and Australia, Indigenous communities with government support, have established ownership and co-ownership schemes for resource projects. Examples include the Gulkula Mining Company, the world’s first Indigenous-owned and operated bauxite mine in Australia, and the First Nations Major Projects Coalition, which invests in major projects on Indigenous lands. 

Finally, to ensure tangible impacts, revenues must be retained locally to develop key infrastructure and services – such as education, health, and housing – that is tailored to the needs of Indigenous people. In Northern Ontario, First Nations are increasingly forming partnerships and development corporations to take a direct role in resource projects, aiming for equitable agreements that protect their lands and ensure fair economic benefits. A notable example is the Greenstone Gold Mines Partnership with the Kenogamisis Investments Corporation and Minodahmun Development LP to ensure First Nations involvement in the Greenstone region’s resource development project. As part of this agreement, the provincial government has committed to improving highway infrastructure and providing training and skills development programs to First Nations people in the area. Working with Indigenous-led organisations ensures that solutions and developments draw on the culture, local knowledge, and experiences of Indigenous communities, and that benefits from projects are shared equitably.

A clear action plan for involving Indigenous peoples in decision-making, integrating their governance, knowledge, and economic development views will benefit not only Indigenous communities but also enhance regional development and ensure stable conditions and broader acceptance for mining projects. 

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The 2024 OECD Mining Regions and Cities Conference will bring together Indigenous representatives from across OECD and partner countries to discuss these practical solutions and propose a “call to action” to implement this paradigm shift for Indigenous sustainable futures in mining context.