#United States #Washington #Indigenous Peoples #Sustainable Finance #US SIF

New Guide Launched to Support Sustainable Investments on Indigenous Lands

In a significant development marking Indigenous Peoples' Day, the US Sustainable Investment Forum (US SIF) has introduced a new guide titled Sustainable Indigenous Finance: Navigating the Energy Transition. This initiative aims to provide investors with a framework to assess and mitigate risks related to energy transition projects on Indigenous lands, while aligning investments with the priorities of Indigenous communities.

The guide highlights the growing realization that Indigenous Peoples and local communities manage approximately 50% of the world's land, including 54% of remaining intact forests and significant biodiversity hotspots, making their involvement crucial for sustainable investment strategies. Furthermore, reports reveal that a substantial portion of critical minerals, essential for energy transition projects, overlaps with Indigenous territories. For instance, over half of global mining projects for lithium and manganese are situated within these areas, underlining the importance of Indigenous inclusion in investment considerations.

Maria Lettini, CEO of US SIF, emphasizes in the guide the necessity of viewing Indigenous priorities as essential investment factors rather than obstacles. She states, “By recognizing Indigenous rights as a critical component of investment strategy, we can unlock private capital while advancing sustainability and upholding our responsibilities in natural resource management.”

Despite the potential for conflict arising from neglecting Indigenous perspectives, many companies have historically overlooked the impact their projects can have on these populations. Such oversights can contribute to increased risks, including supply chain disruptions and legal challenges. Specifically, energy transition projects located close to Indigenous lands face up to 500% more incidents of disruptions, indicating the financial and operational imperatives associated with respecting Indigenous rights.

To help navigate these complexities, the guide outlines a three-tiered de-risking framework that spans institutional, portfolio, and project levels. This framework equips investors with tools, case studies, and checklists aimed at integrating Indigenous considerations into their investment processes. Key insights from the guide include:

• - Fiduciary Duty: Failure to acknowledge Indigenous claims could result in breaches of fiduciary responsibilities due to the material risks involved.
• - Risk Management: Respecting Indigenous rights can prevent supply chain interruptions and financial losses.
• - Opportunity Creation: Collaborating with Indigenous communities can yield shared economic and environmental value.

Rebecca Adamson, Cherokee economist and founder of First Peoples Worldwide, notes that innovations in research and AI technologies are now enabling investors to correlate company performance with impacts on Indigenous communities. “Sustainable finance can bring fundamental values such as reciprocity and respect into capital movements,” she remarks, emphasizing the need for Indigenous communities to be recognized as vital partners and rights-holders, not mere stakeholders.

Formation of Indigenous Advisory Council

In conjunction with this guide, US SIF has also announced the formation of its inaugural Indigenous Advisory Council, comprising members from various Native communities who bring diverse expertise across banking, law, philanthropy, and governmental sectors. The council is intended to ensure that the activities and work plans of US SIF are inclusive of Indigenous perspectives and that they uphold Indigenous rights.

Current council members include:

• - Bryan Newland, Principal at Powers Pyles Sutter and Verville PC and member of the Bay Mills Indian Community,
• - Larry Roberts, Attorney General for the Mohegan Tribe and citizen of the Oneida Nation of Wisconsin,
• - Janie Simms Hipp, Founding CEO of Native Agriculture Financial Services and citizen of the Chickasaw Nation of Oklahoma,
• - Toni Stanger-McLaughlin, CEO of the Native American Agriculture Fund and citizen of the Coville Confederated Tribes,
• - Libby Washburn, Associate CEO of the Native American Agriculture Fund and citizen of the Chickasaw Nation.

Libby Washburn articulates the transformative potential that lies at the intersection of finance and Indigenous knowledge: “When capital flows align with Indigenous stewardship principles, both investors and Indigenous communities stand to gain. Acknowledging Indigenous rights within sustainable investment unlocks opportunities for shared prosperity.”

As US SIF continues its mission to connect capital markets with sustainable outcomes, this guide serves as a foundational tool for investors aiming to navigate the complexities of Indigenous inclusion in the energy transition successfully. With the current global momentum towards sustainability, integrating Indigenous rights and leaders into investment strategies is not just an ethical obligation; it's a pathway to enhanced resilience and long-term value creation for all stakeholders involved.

Stay informed on these developments by following US SIF’s journey towards sustainable and inclusive investment approaches.