Beyond the Duty to Consult: Reimagining Corporate-Indigenous Partnerships as Strategic Alliances

Purpose

This briefing note is written for business executives, scholars, and thought leaders to call attention to the limitations of Canada’s current approach to Indigenous consultation and to advocate for a transformative shift toward rights-based, strategic alliances. These alliances, grounded in shared ownership, equitable decision-making, and mutual benefit, are essential for fostering resilience, securing social license, and aligning with the imperatives of reconciliation and sustainability.

Background

In Canada, the duty to consult Indigenous communities, as mandated by landmark court decisions such as Haida Nation v. British Columbia (2004), requires business enterprises to engage with Indigenous groups when projects are likely impact their rights or territories. However, this legal obligation is frequently reduced to a procedural formality—a check in a box—rather than a foundation for authentic, enduring relationships. This current legalistic approach has proven inadequate, and projects that technically meet legal requirements frequently face public opposition, leading to costly delays and reputational damage (Borrows 218). The growing complexity of Indigenous governance, coupled with increased public and investor scrutiny, demands a rethink of how Canada’s corporations engage with Indigenous nations.

Discussion

1. Legal Compliance is a Starting Point, Not a Destination

The duty to consult is a critical legal framework, but it represents the minimum threshold for engagement, not a blueprint for legitimacy or partnership. Rooted in Section 35 of Canada’s Constitution Act, 1982, this duty compels companies to consult Indigenous communities. But it does not mandate their consent or ensure their inclusion in processes of decision-making (Borrows 220). As a result, corporations often adopt a transactional mindset, fulfilling legal requirements without investing in trust and reciprocity. The approach often backfires, as demonstrated by the Coastal GasLink pipeline project, where TC Energy secured agreements with elected band councils but overlooked the authority of hereditary Wet’suwet’en leaders. The resulting protests, blockades, and national disruptions in 2020 underscored a critical lesson: legal compliance does not secure community support or social license (Newman 34).

True partnership requires sustained, respectful engagement that honors Indigenous governance structures, acknowledges historical grievances, and embeds Indigenous voices in project design and execution. By treating consultation as a continuing process, companies can build relationships that mitigate conflict, enhance legitimacy, and create shared value (Borrows 221). For executive leaders, this shift demands a cultural and strategic reorientation.

2. Contrasting Models: Transactional vs. Transformational Partnerships

A comparative analysis of the Coastal GasLink project and Indigenous-led clean energy consortia illustrates the contrast between transactional compliance and transformational partnership.

Coastal GasLink Pipeline:
TC Energy’s Coastal GasLink project, a 670-kilometer natural gas pipeline in British Columbia, illustrates the pitfalls of a compliance-driven approach. Although the company offered equity options to 16 First Nations, granting a 10% ownership stake, these agreements were negotiated late in the process, long after significant conflict had erupted. Moreover, the project’s failure to engage hereditary Wet’suwet’en leaders, whose governance systems hold ultimate authority over traditional territories, fueled opposition, which included rail blockades and protests that disrupted Canada’s economy in early 2020 (Newman 36). Despite meeting basic legal consultation requirements, the project continues to face operational challenges, legal disputes, and reputational damage. It highlights the fragility of partnerships built on minimal engagement.

Indigenous-Led Clean Energy Consortia:
In contrast, Indigenous-led clean energy projects, such as the Hecate Strait Wind Project in British Columbia or the Wataynikaneyap Power Transmission Project in Ontario, demonstrate the strength and durability of transformative partnerships. These initiatives, driven by Indigenous nations as majority owners and primary proponents, found ways to integrate Indigenous values into project design, governance, and outcomes. The Wataynikaneyap project, led by 24 First Nations, now delivers reliable electricity to remote communities while creating jobs, training opportunities, and long-term revenue streams. Such projects secure faster regulatory approvals, enjoy popular support, and align with global sustainability goals. The prove that Indigenous leadership enhances project resilience and social impact (Henderson 59).

The correlation should be clear: greater Indigenous agency and ownership translate into stronger outcomes (Henderson 62). The two case studies show how partnerships that prioritize Indigenous leadership and co-ownership are not only ethically sound but also strategically superior, reducing risks and fostering community trust.

3. Nation-to-Nation Governance and Indigenous-Led Equity Models

To move beyond consultation, corporations must embrace nation-to-nation governance frameworks and Indigenous-led equity models. While equity agreements, such as those offered in Coastal GasLink, signify a degree of progress, they lack depth and are introduced reactively, after trust has begun to erode. A true strategic alliance requires co-designing project governance structures that embed Indigenous consent rights, recognizing cultural values and decision-making authority from a project’s inception (Henderson 65). Some First Nations, such as the Fort McKay First Nation in Alberta, have established sophisticated investment arms that negotiate majority equity stakes and board representation in joint ventures. These models ensure shared accountability, set risks and rewards in alignment, and position Indigenous partners as equal stakeholders in the project.

Skeptics may contend that such arrangements complicate project management and reduce short-term profits. However, evidence suggests the opposite. Projects with robust Indigenous partnerships face fewer legal challenges, protests, and delays, ultimately enhancing long-term value. Institutional investors are recognizing these consultation models as best practices, likely because they mitigate environmental, social, and governance (ESG) risks and secure social license (Newman 39). For example, the Mikisew Cree First Nation’s joint venture with Suncor in the oil sands has delivered economic benefits and strengthened community capacity, demonstrating that shared governance can drive both profitability and reconciliation (Borrows 225).

4. Strategic Imperatives: Risk Mitigation, Social License, and Sustainability

Rights-based partnerships are not merely ethical checklists; they are strategic imperatives that deliver reliable business advantages. Projects grounded in genuine Indigenous alliances face fewer legal challenges, protests, and regulatory hurdles, as demonstrated by the smoother trajectories of Indigenous-led energy projects compared to Coastal GasLink’s ongoing conflicts (Newman 41). These partnerships foster trust and legitimacy, securing the social license critical to operating in an era of heightened public and investor scrutiny. Moreover, Indigenous stewardship often leads to environmentally and socially responsible outcomes, helping to align projects with global sustainability trends (Henderson 68).

For business executives, the case is compelling: strategic alliances with Indigenous nations reduce operational risks, accelerate project timelines, and enhance corporate reputation. They also position companies as leaders in reconciliation, a priority increasingly demanded by governments, investors, and civil society. By investing in relationships that share power and distribute a share of the benefits, corporations can navigate complex socio-political landscapes while increasing long-term value.

Conclusion

The future of resource development in Canada hinges on a fundamental shift from the duty to consult to strategic, rights-based alliances with Indigenous nations. These partnerships, rooted in shared ownership, co-governance, and mutual benefit, transcend legal compliance to deliver resilience, legitimacy, and sustainability. For business executives and thought leaders, embracing this model is not just a moral or reputational necessity: it is a strategic imperative for thriving in a rapidly evolving economic and social landscape. By prioritizing Indigenous agency and aligning business strategies with the principles of reconciliation, organizations can unlock new opportunities, mitigate risks, and lead the way toward a more equitable and prosperous future.

Works Cited

Borrows, John. Canada’s Indigenous Constitution. University of Toronto Press, 2010.

Henderson, James (Sákéj) Youngblood. Indigenous Diplomacy and the Rights of Peoples: Achieving UN Recognition. UBC Press, 2008, https://www.ubcpress.ca/indigenous-diplomacy-and-the-rights-of-peoples.

Newman, Dwight G. The Duty to Consult: New Relationships with Aboriginal Peoples. Purich Publishing, 2009, https://www.ubcpress.ca/the-duty-to-consult.