More public companies are pursuing economic reconciliation with Indigenous peoples this proxy season, promising developments that signal a turning of the tide in Corporate Canada.
Heavy equipment provider Toromont Industries Ltd., telecommunications giant BCE Inc. and insurer IA Financial Corp. Inc. are the latest companies to make public commitments on Indigenous inclusion after holding talks with the Shareholder Association for Research and Education, or SHARE, a non-profit organization that represents institutional investors.
Their corporate pledges – which are aimed at closing socioeconomic gaps that disadvantage Indigenous peoples – follow similar moves by companies including TMX Group Ltd. and Sun Life Financial Inc. last year. Although it is still early days for each of these businesses, their respective commitments will put much-needed pressure on other public companies to follow suit.
Economic reconciliation is a multifaceted process that is based on the Truth and Reconciliation Commission’s call to action No. 92. It provides a framework that covers everything from employment policies to procurement practices. Moreover, it urges companies to conduct meaningful consultations with Indigenous communities, treat them as economic stakeholders and obtain their informed consent prior to proceeding with economic development projects.
“Our shareholder engagement priorities are shaped by the most pressing issues that companies, investors, and Canadian society faces today – including the climate crisis and social inequality,” said Anthony Schein, SHARE’s director of shareholder advocacy. “Undeniably, reconciliation with Indigenous people is atop the list of pressing issues facing this country.”
SHARE filed shareholder proposals at four companies during the 2022 proxy season, including Toromont, BCE, IA Financial and Onex Corp.
For its part, Toromont is urging its other investors to vote for the SHARE proposal, which was filed on behalf of the Atkinson Foundation, at its coming annual meeting.
“Toromont believes that providing clear and consistent information about our approach to Indigenous relations, recruitment and advancement and education on Indigenous reconciliation may be important for investors to better understand our approach and position relative to our peers,” the company states in its proxy circular.
SHARE, meanwhile, later withdrew its shareholder proposals at BCE (filed on behalf of the Mississaugas of the New Credit First Nation Community Trust) and at IA Financial (filed on behalf of the Daly Foundation) after both companies agreed to make voluntary commitments on Indigenous inclusion.
The only holdout is Onex, which is opposing a SHARE proposal filed on behalf of the Catherine Donnelly Foundation. It’s a thoroughly disappointing position for a leading private-equity firm.
“While the corporation recognizes that fostering a diverse team in an inclusive environment can create a competitive advantage for idea and value generation for the corporation and its investors and shareholders, the board and management understand that a commitment to improving diversity and inclusions at all levels is a multistage journey that is not easily solved by focusing on a particular group of underrepresented individuals,” states Onex’s proxy circular.
That’s perverse. This rationale is an unnecessary pitting of underrepresented individuals against one another.
“The journey of reconciliation between Indigenous and non-Indigenous people in Canada is indeed separate,” said Tabatha Bull, president and chief executive officer of the Canadian Council for Aboriginal Business, or CCAB, adding this includes respecting constitutionally-recognized treaty agreements.
“Many organizations state that there are not enough Indigenous businesses in Canada or that there are no Indigenous businesses that can supply what a corporation purchases. I would challenge any corporation who makes a claim such as that to prove it,” she added.
Onex’s board of directors should check out CCAB’s Progressive Aboriginal Relations program. That certification program offers a phased process that helps companies build a comprehensive Indigenous-relations strategy. Participants include a wide range of companies, including Suncor, Sun Life, Bank of Montreal, Colliers, and Uber. IA Financial and BCE have also agreed to join the program as part of their commitments.
“We recently completed Phase 1 of the Progressive Aboriginal Relations certification,” Sun Life said in an e-mailed statement. “This program will help us to drive meaningful change across Sun Life in four key performance areas: leadership actions, employment, business development, and community partnerships.”
Canadian public companies are indeed engaging in increased dialogue around economic reconciliation. A search of global filings, transcripts and press releases on the financial-intelligence platform Sentieo yielded 339 mentions of the topic for the past two years alone.
It makes perfect sense. Economic reconciliation is a litmus test of a public company’s environmental, social and governance commitments.
Moreover, the leadership shown by big corporations is having a “trickle effect” on small businesses, Ms. Bull said. (CCAB also runs a program for these smaller companies.)
TMX chief executive officer John McKenzie, in particular, “has been really great about talking about the work that TMX is doing and encouraging other organizations to do the same,” she added.
As Ms. Bull says, it’s easy for big companies to avoid difficult conversations. But doing so creates reputational risk given the social reckoning that’s under way in this country.
Corporate Canada has an important role to play in reconciliation with Indigenous peoples. Some public companies are already taking action. The rest must decide whether they will be leaders or laggards.
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