Opportunities Agreements

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In 2010, BHP Billiton conducted baseline studies for the Jansen potash project in Saskatchewan and discovered a challenging socioeconomic situation among some local First Nations communities. The high-school completion and labour force participation rates for these communities were about 40 per cent below the provincial average, and the unemployment rate was three to five times the provincial average. At the same time, there was a very young population with a median age range of 20 to 28 years compared with the provincial average of 38 years.

The demographics and socioeconomic situation presented an opportunity for the mutual benefit of BHP Billiton and the local First Nations. The latent capacity in the workforce was a valuable opportunity in an environment where labour force is difficult to come by. There was the opportunity to develop local suppliers and support communities.

Early attempts for BHP Billiton to engage with the communities to conduct baseline studies were challenging because of an environment that had sowed mistrust between First Nations communities and industry historically. The baseline study that was completed concluded that 24 per cent of the population in the area were Aboriginal. Historically, First Nations people have been under-represented in employment and business participation in the potash industry.

A memorandum of understanding (MOU) to negotiate an opportunities agreement was offered to the First Nations during the environmental assessment process, and one of the First Nations signed an MOU with BHP Billiton. The environmental impact statement filed for regulatory approval included a commitment to pursue opportunities agreements with local First Nations. During the public comment period, the First Nations were not able to provide comments on the environmental impact statement. While studies by regulators and the company determined the project would not impact indigenous land use, the situation highlighted the need to build the First Nations’ capacity to provide technical feedback.

To help build a relationship and enhance BHP Billiton’s understanding of the communities, BHP Billiton supported traditional knowledge and land use studies with the communities. The studies were resourced sufficiently to document all of the communities’ land use rather than being constrained by the Jansen project area. The communities’ history was also documented utilizing oral testimony and secondary research. The final product consisted of books that served as a cultural resource for the communities and a tool for BHP Billiton to understand the communities’ land use in relation to the project.

Part of the negotiations included bringing the communities’ chief and members of BHP Billiton’s senior leadership team and management team together for a two-day workshop. During the workshop, BHP Billiton provided presentations on plans and goals for each area of the agreement, and the parties discussed their mutual goals and provided clarity in areas of uncertainty. The topics of discussion included:

  • agreement governance
  • education
  • employment and training
  • business development
  • support for community development
  • engagement with community members
  • sharing environmental information
  • dispute resolution

The workshop developed a common understanding of what could be achieved through an agreement.

Following the workshop, a draft term sheet was prepared by BHP Billiton that served as the basis to draft the opportunities agreement.

The agreement was signed and made official according to First Nations protocol. Respect for all First Nations cultural protocols was a key success factor for the negotiations and making the agreement.

The agreement seeks to build capacity and provide opportunities for all parties to achieve sustainable outcomes. The outcomes sought include increased high-school graduation rates and employment rates. The agreement also seeks to provide business opportunities that foster sustainable development of First Nations-owned businesses. Community development investments are also targeted for sustainable initiatives. Sharing traditional knowledge for land use activities will support sustainable environmental management practices.

The agreement is governed by teams that have equal representation from BHP Billiton and the First Nations. The teams create five-year plans in the areas of training, community development and economic development. Transparency with community members is committed to including annual reports being delivered at community meetings. There are also commitments by BHP Billiton to enhance the communities’ understanding of the potash industry by hosting annual workshops. In addition, BHP Billiton provides annual information sessions regarding the project to create an understanding and serve to address issues and concerns regarding the project.

The agreement creates an Elder Advisory Team that can provide cultural advice and guidance for the benefit of BHP Billiton’s operations. BHP Billiton provides cultural awareness training to its employees and contractors to which the elders will contribute their knowledge.
In addition, the Elder Advisory Team will provide advice that will enhance BHP Billiton’s efforts to respect cultural protocols in its operations and for its workforce.

One of the challenges encountered during implementation was the learning curve required by the First Nations to navigate company policy. In particular, submission requirements as they relate to providing approvals for funding for community development projects, training and economic development capacity posed a challenge. A greater focus was required after implementation by both parties to understand each other’s processes and cultures. An example is BHP Billiton’s need to create an understanding regarding the role of elders, their expertise and protocols for engaging elders among those in the organization that need to endorse and approve activities involving elders.

Confidentiality requirements in the agreement presented a learning opportunity. Sharing confidential information with community members and potential partners to achieve the parties’ objectives required some discussion.

BHP Billiton undertook work in advance of execution of the agreement to create the necessary tools for implementation in order to achieve the desired economic development and employment outcomes. A BHP Billiton employee was seconded to a First Nations organization to assist in creating a self-sustaining online database of First Nations businesses and potential jobseekers. The database will help to qualify businesses and to match jobseekers with available positions.

This voluntary agreement formalizes the relationship to foster trust and collaboration. Integrity and respect are guiding principles, and BHP Billiton’s value of doing what it says it will do has been important. Mutually developed plans and reporting back to community members will seek to continually improve the meeting of the agreement’s objectives. The vision is to create sustainable relationships and initiatives for the benefit of generations to come.