Moving from Consultation to Consent?

FPIC Indigenous People IFC PSThe IFC Performance Standards require that projects with potentially significant impacts conduct ‘Free, Prior, Informed Consultation’ (FPIC) and demonstrate ‘Broad Community Support’ (BCS). Will these requirements move towards the concept of ‘Consent’ particularly in the context of Indigenous Peoples?

Shortlink: http://wp.me/p27qSt-3v

During the March 2010 PDAC exploration and mining convention in Toronto, the Export Development Canada (EDC), hosted an event entitled “Who are you and what have you done with my banker?” This event took a ‘process-oriented’ look at how the environmental and social requirements for various sources of capital for mining and metal projects are integrated into due diligence and decision making processes, and what that means for sponsors seeking project finance and political risk insurance.

During his presentation, John Middleton of the IFC highlighted that the topic of ‘Consent,’ was deliberately not adopted when the IFC Performance Standards were developed and launched in 2006. However, this topic is now back on the table during the on-going review process of the IFC Performance Standards (see also my previous blog: Review of 3 years of IFC Performance Standards).

It is not surprising that Indigenous People/affected communities want to be able to have a say about if, what and how development should take place. Similarly, the extractive industry is concerned about their perception of veto power embodied by the world ‘Consent’ and how this might be used (or misused) to dilute their legal titles and undermine their investments.

There is already precedence set on using the term ‘Consent’ by another multilateral financial institution: the European Bank for Reconstruction and Development (EBRD). It’s 2008 Environmental and Social Policy and associated Performance Requirements, which are largely modeled after the IFC Performance Standards, the EBRD refers to specific vulnerability of Indigenous Peoples and the 2007 UN Declaration on the Rights of Indigenous Peoples. EBRD now requires that the prior informed consent of affected Indigenous Peoples is required for specified project-related activities.

There is another fascinating aspect about the concepts of Broad Community Support, which can exist even if not everybody approves, and Consent, which may be offered through an MOU or similar process and can also exist when not everybody supports a project. These concepts remind me of a marriage. Good ones contain an implicit need to earn support/consent which does not end with a signed paper – it has to be continuously earned and strengthened to withstand the ups and downs of real life – warts and all.

8 Comments to Moving from Consultation to Consent?

  1. Deborah Huisken says:

    I was struck by the sentence above “Similarly, the extractive industry is concerned about their perception of veto power embodied by the world ‘Consent’ and how this might be used (or misused) to dilute their legal titles and undermine their investments.”

    Surely that is the whole point, that indigenous peoples and other concerned stakeholders have veto power over these “investments”, which in fact belong to more than just the companies wanting to profit from them. They are, in fact, part of our world-wide heritage, and must be marshaled wisely, for both their short- and long-term value. Most companies have far too much of a short-term view… (e.g. quarterly)…

  2. Thanks for your note Deborah. The owner-investors in extractives often have a much longer term view- but granted, this may not be true shareholder trading their shares daily on TSX… Would you think that that industry concerns about, for example, competitors who could find ways to misuse a ‘veto opportunity’ to be a reasonable concern? How about a community (indigenous or otherwise) and its leadership, which could be in favor of a development but can be ‘held hostage’ (if you allow me to exaggerate) by a couple of individuals who have their own agenda which may be completely unrelated to the development and positive/negative impacts? Best, Mehrdad

  3. Dear Mehrdad, just saw this link today and remebered.
    Best wishes, Silvio

    http://www.wri.org/stories/2010/05/momentum-builds-gaining-consent-indigenous-peoples

  4. […] is critical of IFC’s implementation of its Broad Community Support commitment (seel also an earlier blog) and describes IFC’s approach as highly restrictive and not transparent. Also, the Note highlights […]

  5. […] concepts such as ‘Free Prior Informed Consultation/Consent’ or FPIC (see also my previous blog here). However, the presenter also recognized that GRI reports do not provide readily accessible […]

  6. […] Prior and Informed Consent (FPIC) for Indigenous Peoples, when applicable. (See also one of my earlier blogs about FPI-Consultation and […]

  7. […] Performance Standards. Changes revolve around resource efficiency, greenhouse-gas, adopting ‘Free, Prior, and Informed Consent’, and broader disclosure […]

  8. […] In Bill’s presentation on the Performance Standards and the Equator Principles he defined the role and responsibilities of the IFC and its clients in implementing the recently revised Standards.  In doing so he paid particular attention to PS 6 on Biodiversity Conservation and Sustainable Natural Resource Management and PS 7 on Indigenous Peoples, both of which have been substantially strengthened in the recent revision.  The new requirements for biodiversity offsets and Free and Prior Informed Consent (FPIC) prompted a number of questions from the participants. (See also previous blog entries that on FPIC here and here). […]

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