Essential ESG: Episode 13 – An introduction to FPIC

Phoebe Wynn-Pope, Head of Responsible Business and ESG

Joshua Aird, Senior Associate, Responsible Business and ESG and Commercial Litigation

Phoebe: Welcome to another instalment of the Corrs Essential ESG Podcast, being brought to you from the lands of the Wurundjeri people of the Kulin Nation. My name is Phoebe Wynn-Pope and I’m the Head of Responsible Business and ESG at Corrs Chambers Westgarth. And joining me today is a senior associate in our responsible business team, Joshua Aird. Welcome Josh.

Josh: Thanks for having me Phoebe.

Phoebe: Josh today we’re going to talk about this increasing emphasis that there is on the need for project proponents to secure free, prior and informed consent, or FPIC, as they’re developing their projects on traditional lands of indigenous people, not only in Australia, but also around the world. And we’ve seen that the demands for the protection of cultural heritage of First Nations people and the recognition of their rights, has really increased expectations that FPIC will be incorporated into project planning, into the development, and lending and investment decisions. And I thought it would be really helpful to have a discussion about what FPIC is, where it’s come from, and to really delve deep into understanding this very critical issue for project proponents going forward. So can you start us off Josh and just tell us a little bit about FPIC. What is it?

Josh: FPIC is really an international human rights principle and it’s derived from the right to self-determination and the right to be free from racial discrimination. Self-determination is a fundamental right of all people and is enshrined in Article 1 of both the international covenant on civil and political rights and the international covenant of economic, social and cultural rights. And the right has been expanded in the context of indigenous peoples in the United Nations Declaration on the Rights of Indigenous Peoples and various ILO conventions to really reflect the fact that FPIC, or free, prior and informed consent is a way for indigenous peoples to realise the right to self-determination.

Phoebe: So when we’re talking about free, prior and informed consent, there’s obviously those four elements in it. Can you just run us through those and what they actually mean, because it’s not as self-evident, I don’t think, as people might think at first glance.

Josh: Yeah that’s right. So FPIC has both procedural and substantive requirements and should really be considered in a holistic way rather than a ‘check-box’ exercise. That being said, it is always still helpful to break down the component elements of FPIC. So obviously we’ve got ‘Free’ which means that any consent that’s provided by an indigenous or First Nations group should be provided free from coercion and manipulation, but also with sufficient time to allow for engagement and discussion in a culturally appropriate manner. ‘Prior’ means that obviously consultation must begin before any impact on the right to self-determination has occurred. ‘Informed’ means that consent should be obtained and informed by accurate, timely and sufficiently detailed information, but also that information should be provided in a way that can be easily understood.

Phoebe: So that would include in local language, oral communication, perhaps a whole range of different avenues for communication to ensure that things are properly understood.

Josh: That’s right. We have also seen instances in which site visits are undertaken, with indigenous representatives, to be able to really show them on the ground what’s going to happen to particular areas. And finally we have ‘Consent’. And this is always a bit of a sticking point. Consent is not a moment in time. Consent should be obtained by culturally appropriate decision-making processes, but it’s also ongoing. Consent should be obtained, but also retained throughout the process of the project.

Phoebe: So often that means that a process needs to be built in all the way throughout the life of the project, doesn’t it? It’s not just a ‘tick a box, we’ve got consent, it’s done’, but that that ongoing consultation needs to be undertaken throughout the life of the project.

Josh: That’s right and sometimes that can be a bit jarring when we think about normal formulation of contracts in the business world, where once you’ve got the contract you just get on with it. That’s not the case here. It’s a situation of constant engagement with the appropriate representative bodies.

Phoebe: So can you tell us when FPIC is actually required?

Josh: There are specific situations where international agreements require FPIC to be obtained, but there’s also some tension between domestic legislation, those international agreements and stakeholder expectations. So guidance can be taken from UNDRIP, or the United Nations Declaration on the Rights of Indigenous Peoples, which requires FPIC in five distinct circumstances:

(1) when relocating indigenous peoples from their land; (2) when cultural, intellectual and spiritual property is impacted; (3) when adopting and implementing legislative or administrative measures that may affect indigenous populations;(4) in relation to the storage and disposal of hazardous materials on customary lands; and (5) which is probably the most relevant for the clients that we’ve been advising and that’s prior to approval of any project affecting the lands or territories of indigenous peoples, but as I said before it’s really important to remember that the principle of FPIC is a way for indigenous and First Nations people to realise the right of self-determination and the right to self-determination applies in more than just those five circumstances.

So it really is a principle that people should be keeping in mind whenever engaging with indigenous and First Nations groups.

Phoebe: In the Australian context the expectations have expanded and there are a number of different resources that are available. Could you tell us a little bit more about those?

Josh: Yes so because of the complexities we’ve already discussed there are several industry-based standards that seek to articulate both the context of FPIC – the free, prior and informed consent – and when FPIC is required by organisations in different sectors. Because of the nature of the sector we’ve seen a lot of engagement from the energy and resources sector but we’re increasingly seeing advice and information come from the finance and superannuation sectors. Both the Australian Council of Superannuation Investors and the Responsible Investment Association of Australasia have released guidance on engaging with First Nations peoples and including the expectation that investors and investee companies will really commit to respecting First Nations peoples’ rights and cultural heritage in accordance with UNDRIP and the principle of FPIC.

Phoebe: There have also been a number of enquiries about UNDRIP and the application of UNDRIP in Australia and what that means. Lots of stakeholders have been providing submissions to those enquiries and they are feeding into a range of different reforms that are coming about in environmental protection and biodiversity reforms for example. Could you take us through some of those, Josh?

Josh: Following the events at Juukan Gorge and the destruction of indigenous heritage sites the Government has committed to developing new laws and partnership with First Nations people that draw on the final report of the Senate Standing Committee. In addition, there is a separate senate enquiry into implementing UNDRIP into Australian law and key submissions have called for the Government to review existing legislation, not only for consistency with UNDRIP but also (due to) the challenges of implementing UNDRIP in the existing legislative regimes. So the Commonwealth Government has also announced its nature positive plan late last year as part of broader reforms so the EPBC Act or the Environment Protection and Biodiversity Conservation Act but the intent of this plan is to really improve and expand the protection of biodiversity in Australia and it includes a development of a national environmental standard for First Nations engagement and participation in decision making. It also introduces standalone cultural heritage legislation to replace the existing Aboriginal & Torres Strait Islander Heritage Protection Act.

Phoebe: So that standard will aim to embed FPIC principles consistent with UNDRIP into the standard and also empower that active participation and decision-making and greater consideration of First Nations land, freshwater and sea management knowledge and also to create additional regulatory requirements for project proponents and investors to satisfy won’t it?

Josh: That’s absolutely right and it’s an increasing trend that we’re seeing from ministers of the Labor Government in engaging fully with First Nations groups on these particular issues.

Phoebe: And now litigation – we’re beginning to see this issue start to raise its head in the courts. Can you talk to us about that a little bit?

Josh: We’re seeing FPIC as a real avenue for challenge for project permits at the moment. In particular, where consultation has not been sufficient with local indigenous and First Nations groups, they’re seeking to challenge the grant of project permits or approvals on that basis and we’ve really seen a willingness of the courts to engage in FPIC principles in existing consultation obligations. We expect that these types of challenges and the willingness of the court to engage FPIC or FPIC-like arguments is going to increase into the future.

Phoebe: So with all of this, Josh, with the enquiries, with the government bringing FPIC principles into different kinds of legislation like the nature positive plans and so on, the increasing amount of guidance available and the courts taking an interest in free, prior and informed consent what does it all mean going forward? What do organisations need to be thinking about?

Josh: It's such a fast-paced and dynamic environment that businesses really need to be reviewing and assessing their organisational understanding but also implementation of FPIC not only against UNDRIP but also stakeholder expectations. This will assist them to protect against project delays, increased litigation risk and commercial and reputational damage.

Phoebe: There is certainly a lot to think about here. Josh, you have given us a great whiz around the world of FPIC. Thank you very much.

Josh: Anytime Phoebe.

This podcast is for reference purposes only. It does not constitute legal advice and should not be relied upon as such. You should always obtain legal advice about your specific circumstances.

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