Miners can support indigenous peoples through procurement

22 February 2017

Canada’s mining industry is in an excellent position to help the country’s indigenous population through its procurement policies, a study has found.

A report by the Canadian Council for Aboriginal Business and Mining Shared Value, said companies could also reap benefits from contracting with indigenous suppliers.

Aboriginal stakeholders interviewed as part of the report said they were not against mining but it must be sustainable, safeguard the environment and provide them with an equitable share of economic benefits and opportunities.

Aboriginal businesses have significantly developed over the last few decades and are well-placed to supply the diverse equipment and services required by mining operations, the report said.

“The procurement spend of mining operations dwarfs what is spent on community philanthropy and provides a catalyst for business development and local supply chain creation,” it added.

The report said there was increasing recognition among mining companies that buying goods and services from local aboriginal suppliers can benefit both parties.

Aboriginal suppliers are often locally based and therefore easier to contract on short notice than more long-distance service providers. Many companies said it was cheaper to contract aboriginal suppliers because it reduces the need for flights and accommodation.

Hiring indigenous people also leads to better worker retention and lower recruitment costs, according to the report, as well as bringing specialised knowledge and experience of local conditions.

“Because of their knowledge of the land and environment, Aboriginal suppliers are often best equipped with the experience and skills necessary to work safely... in harsh conditions that typify remote, northern climates where mines tend to operate,” said the report.

Canada’s aboriginal population is projected to increase four times faster than the national average and could play a major role in helping mining companies facing potential talent shortages.

Heather Lawrence, manager, indigenous affairs at mining company Teck, was quoted in the report: “Having strong relationships and Indigenous support are significant benefits when we’re discussing our activities with government or other local community members.”

Meanwhile, investing in local suppliers through procurement contracts can develop the range of goods and available services, decreasing transportation and procurement costs.

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