The United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), specifies that Indigenous peoples have the right to free, prior, and informed consent with regard to their lands, culture, and resources. This right is asserted in the context of self-determination and recognition that Indigenous peoples have suffered from historic injustices. The following preambular text of UNDRIP sets out the context for these rights:
“Concerned that Indigenous peoples have suffered from historic injustices as a result of, inter alia, their colonization and dispossession of their lands, territories and resources, thus preventing them from exercising, in particular, their right to development in accordance with their own needs and interests…
“Recognizing the urgent need to respect and promote the inherent rights of Indigenous peoples which derive from their political, economic, and social structures, and from their cultures, spiritual traditions, histories and philosophies, especially their rights to their lands, territories, and resources…
“Convinced that control by Indigenous peoples over developments affecting them and their lands, territories, and resources will enable them to maintain and strengthen their institutions, cultures, and traditions, and to promote their development in accordance with their aspirations and needs…”
In addition to the moral obligation to honor human rights, engaging in and honoring the outcomes of FPIC processes is also a means of minimizing and transforming the conflict and violence that has historically been imposed by governments and industries on Indigenous peoples.
FPIC is the foundation for democratic fair-dealing between communities and companies.
— Vincent Ekka, Kurux (Oraon) peoples of India; Head of the Department of Tribal Studies, Indian Social Institute, New Delhi, India
Disregarding community wishes is also bad business. Research by the Corporate Social Responsibility Initiative at Harvard Kennedy School and the Centre for Social Responsibility in Mining at the Sustainable Minerals Institute at The University of Queensland in Australia found that delays due to protests can be costly: around $10,000 USD per day in early exploration, around $50,000 USD per day in advanced exploration, and up to $20M USD per week of shutdowns during operations. In addition to the financial cost of interrupted operations, there is reputational cost, which can radiate outward to inhibit other partnerships and developments. Investors are increasingly conscious of the material risk associated with failure to respect human rights or manage conflict at sites.