NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Guyana has approximately 78,500 Indigenous people representing nearly 10.5% of its population, divided into over 240 communities living on some 6 million hectares of land. About 90% of these communities live in the country’s vast interior, on land that has large deposits of gold.

In 2021, gold represented 8.8% of Guyana’s economic output, and over the years it has been a considerable part of the country’s economy. The Government of Guyana holds the gold trade in high esteem, and it has traditionally prioritised gold mining over efforts to solidify indigenous peoples’ titles over their land. This has contributed to major disputes between businesses and Indigenous groups in Guyana, involving land access and land rights within these gold mining areas, as determined by the government agencies that grant permits to mining businesses.

One such dispute, which made international headlines, involves a mining operation in the indigenous village of Chinese Landing. Village residents have been involved in a court action to regain full control over 3,400 acres of ancestral land where Guyana’s government had issued gold mining permits. This mining activity has eroded Indigenous land, scraping back layers of soil and red rock and contaminating the local water supply. The local Indigenous community views these outside miners as unwelcome interlopers who have carved up their lands — which provided them food and medicine — while also blocking access to their own smaller-scale mining operations.

The legal case between one miner and the local Indigenous community reached Guyana’s apex court, the Caribbean Court of Justice, with the court ultimately ruling in favor of the miner. But the dispute did not end there: The Chinese Landing community brought the matter to the Inter-American Commission on Human Rights, urging it to require Guyana to adopt precautionary measures to ensure their rights to life and personal health, which they claimed were at risk due to mining activities carried out on their lands. In response, the Commission requested that Guyana take measures to protect the Chinese Landing community, prompting the Guyanese government to temporarily ban all mining on Indigenous land in this area. This decision has halted the activities of both external and small-scale local miners, leading Indigenous residents to call on the government to exempt their own mining operations — an important source of their livelihoods — from the ban.

Operating a Mining Business While Respecting Indigenous Rights

The situation in Guyana is not unique: As the global demand for critical metals and minerals grows, other Indigenous groups across the region and around the world have increasingly been protesting permits for mining operations in various contexts. As a result, mining businesses operating in areas that impact Indigenous peoples must consider how to avoid ending up in conflicts with these communities — not only to protect Indigenous peoples’ wellbeing, but to avoid risks to their own operations.

Failing to respect Indigenous rights can lead to significant financial and reputational risks for these businesses, including project delays, legal disputes, social unrest and brand reputation damage. Overall, respecting Indigenous rights leads to a less risky business model that is more competitive, better positioned for the long term, and better prepared for uncertainties. When considering Indigenous peoples’ rights, mining businesses should make sure they understand the potential risks associated with operating on Indigenous communities’ lands and/or using their resources. To that end, businesses should actively engage in practices that seek free, prior and informed consent (FPIC) from affected communities before initiating mining projects.

FPIC is a concept described in the United Nations Declaration on the Rights of Indigenous Peoples, adopted by the UN General Assembly in 2007. This declaration recognises the rights of Indigenous peoples, including their right to self-determination, and emphasises the importance of FPIC as a prerequisite for any activities that may affect their ancestral lands, territories and natural resources. The UN encourages businesses in industries that impact the rights of Indigenous peoples — such as mining for gold, bauxite, diamonds and other minerals like magnesium, uranium and semi-precious stones — to adopt FPIC as a guiding principle, and in countries like Guyana, this principle now informs legislation affecting these sectors. This approach helps to prevent harm to Indigenous communities, and unnecessary conflicts that can adversely affect business operations.

Understanding Free, Prior and Informed Consent

Respecting Indigenous rights by adopting the FPIC standard is critical to environmental, social and governance (ESG) investing, and to the integration of ESG targets into businesses. Mining businesses can leverage the FPIC framework to prevent potential ESG issues and disputes with local Indigenous communities, by evaluating the impact of their activities on these communities and assessing their commitment to respecting Indigenous rights.

The FPIC standard requires:

• Respect for Indigenous lands and resources
• Participation of Indigenous peoples in the project, for example, consultation with Indigenous groups, allowing them sufficient time to review business activities affecting their lives
• Negotiation with Indigenous groups concerning project conditions
• The ability of Indigenous peoples to withdraw consent for a mining project after the conclusion of an initial, time-limited contract

It’s essential for mining companies to assess their impact on Indigenous rights during the due diligence phase before a project, as they consider the project’s viability, impacts and needs. Conducting this type of due diligence enables companies to understand their effects on Indigenous communities and evaluate their policies and practices regarding Indigenous rights, as well as their engagement with affected communities.

Best Practices for Maintaining Indigenous Rights

More broadly, it is vital for businesses in the mining industry to develop an Indigenous rights policy and support Indigenous-led initiatives that promote sustainable development and economic empowerment. This includes hiring Indigenous people at fair wages and compensating them for their insights related to a project. To ensure compliance with industry best practices, businesses must stay informed about international standards and regulations related to Indigenous rights, including the UN Declaration on the Rights of Indigenous Peoples.

To comply with operational and Indigenous rights policies, mining businesses should establish transparent, two-way communication mechanisms to inform relevant Indigenous groups and their leaders about their projects. They should also ensure that relevant Indigenous groups consent to these projects, formally acknowledging their rights in a written agreement. This agreement should incorporate mechanisms for monitoring and evaluation, as well as feedback and conflict resolution processes. Companies should ensure that this monitoring and evaluation is participatory, conducted in collaboration with relevant Indigenous groups and their leadership, and that they are documenting lessons learned and making improvements as needed.

Mining businesses can reduce the risk of legal disputes with local and Indigenous communities by implementing the aforementioned best practices while operating in their territories. As an additional protective measure, it is important that these practices are implemented under the guidance of an attorney who is knowledgeable in indigenous rights and corporate commercial law. By adopting these approaches, the mining industry can meet the growing demand for vital metals and minerals, while also respecting the rights — and preserving the wellbeing — of Indigenous communities around the world.

Anna-Kay Brown is an attorney-at-law at Stanbrook Prudhoe, a leading cross-Caribbean practice firm.

Photo credit: Jane Peters