ACCR Shareholder Resolution to Fortescue Metals Group on Australian cultural heritage protection law.

The Australasian Centre for Corporate Responsibility (ACCR) has filed a Shareholder Resolution to Fortescue Metals Group Limited (ASX: FMG) on Australian cultural heritage protection law.

This page contains the resolution and its supporting statement, and will be updated with links to news and additional briefings about this engagement.

Resolution on Support for Improvement to Western Australian Cultural Heritage Protection Law

To promote the long-term success of our Company, and noting:

The findings and recommendations of the Interim Report of the Joint Parliamentary Committee on Northern Australia’s interim report entitled Never Again published on 9 December 2020 (“Interim Report”);

The importance of adequate cultural heritage protection laws in mitigating social, reputational and financial risks to our Company;

The acknowledged inadequacy of existing cultural heritage protection law and the need for fit-for-purpose cultural heritage protection laws in Western Australia and nationally; and

The objection of WA First peoples and organisations to the Aboriginal Cultural Heritage Bill 2020 (WA) (“ACH Bill”) in its current form,

shareholders request that our Company:

• a) publicly support part of Recommendation 2 of the Juukan Inquiry Interim Report, namely:

  That the Western Australian Government replace the Aboriginal Heritage Act 1972 with stronger heritage protections as a matter of priority, noting the progress already made in consultation on the draft Aboriginal Cultural Heritage Bill 2020. Any new legislation must as a minimum ensure Aboriginal people have meaningful involvement in and control over heritage decision making, in line with the internationally recognised principles of free, prior and informed consent, including relevant Registered Native Title Bodies Corporate under the Native Title Act...;

• b) publicly support the WA Aboriginal peoples calls on the Western Australian Government to pause the enactment of the ACH Bill in its current form and to enter into an engagement in good faith with WA Aboriginal Traditional Owners and their representative organisations to co-design the new WA cultural heritage protection law and regulations; and

• c) ensure that the advocacy of trade associations of which the Company is a member (including the Western Australian Chamber of Minerals and Energy and the Minerals Council of Australia) is consistent with the terms of this resolution, and if not, review to ensure consistency.

Nothing in this resolution should be read as limiting the Board’s discretion to take decisions in the best interests of our Company, or the Board’s ability to limit the disclosure of commercial-in-confidence information.

Supporting Statement to Resolution 1 (956 words including footnotes)

ACCR files these resolutions with the support of the National Native Title Council (“NNTC”) and the Western Australian Aboriginal Heritage Alliance.

Following the detonation of the Juukan Gorge Caves in the Pilbara, Western Australia on 24 May 2020, the bipartisan Commonwealth Parliamentary Committee on Northern Australia launched an inquiry into the circumstances leading to the destruction of the caves (“Juukan Inquiry”).

On 9 December 2020 the Juukan Inquiry released its interim report entitled Never Again^[1] (“Interim Report”).

Juukan Inquiry Findings and Recommendations

The Juukan Inquiry’s Interim Report highlighted the inadequacy of existing cultural heritage protection regulation in Western Australia as instrumental to the destruction of Juukan Gorge: “…The legal framework for the protection of Aboriginal heritage in Western Australia and at the Federal level is completely inadequate...”^[2]

The Juukan Inquiry recommended, among other things, that the Western Australian Government “Replace the Aboriginal Heritage Act 1972 with stronger heritage protections as a matter of priority, noting the progress already made in consultation on the draft Aboriginal Cultural Heritage Bill 2020. Any new legislation must as a minimum ensure Aboriginal people have meaningful involvement in and control over heritage decision making, in line with the internationally recognised principles of free, prior and informed consent, including relevant Registered Native Title Bodies Corporate under the Native Title Act...”^[3]

Aboriginal Cultural Heritage Bill 2020

In fact, the WA Aboriginal Heritage Act 1972 has been under review for over two years. WA Government has announced its intention to enact the Aboriginal Cultural Heritage Bill 2020 (“Bill”) in coming months.

However WA and national First Nations peak bodies and representatives have criticised both the content of the Bill as well as the process by which it has been formulated.

The Bill is criticised as falling short of good practice and FPIC standards. Among other things: Important decisions about the level of applicable cultural heritage protection are put in the hands of mining proponents; the Minister retains the ultimate discretion to permit the destruction of heritage; affected Aboriginal people do not have power to prevent the destruction of heritage; key aspects of the Bill’s operation are subject to Ministerial regulations which have not been revealed; and the proposed framework for Aboriginal consultation relies on local Aboriginal organisations for which no funding or support is identified.^[4]

The NNTC and WA Alliance also contend that consultations about the Bill have been cursory and inadequate. We are informed that there has been little if any consultation with First Nations interests on the current draft of the Bill.

Implications for Shareholders

The destruction of the Juukan Gorge Caves has brought into focus the unacceptable social, reputational and business risks arising from a weak heritage protection regulatory framework and consequent de facto industry self-regulation in the context of mining and cultural heritage protection. To mitigate these risks, mining activities need to be regulated by adequate legislative and policy standards.

Apart from loss of reputation and senior executives suffered by Rio Tinto Ltd last year as a consequence of the Juukan Gorge Caves destruction, it is also well-known that “the fallout [to Rio Tinto] from its bid to mine the $US135 million [Brockman] deposit has forced it to remove about $US11 billion worth of iron-ore reserves, at today’s prices, from its plans”.^[5]

Our Company operates in the same mining province as Rio Tinto; has a contestable record of dealings with native title holders affected by its tenures and operations; and has taken advantage of the same permissive regulatory environment against the wishes of affected First Nations communities.^[6] In doing so it has assumed a similar or greater risk to Rio Tinto’s.

Pause and Redesign of the Bill

In the absence of fit-for-purpose cultural heritage protection legislation that enjoys First Nations’ support, our Company remains exposed to the unacceptable risks outlined by the Juukan Inquiry.

First Nations peak bodies are calling on the Western Australian Government to pause the enactment of the Bill, and to engage in a genuine process of redesign of the Bill to address the shortcomings identified.

The resolution requests that our Company publicly support these calls by First Nations organisations. For reasons stated, it is in the interest of our Company and its shareholders to accept and support the resolution. It is also consistent with our Company’s stated position. On 10 December 2020 our Company issued an ASX release that included the following comments.

“We support the modernisation of Western Australia's Aboriginal Heritage protection law, including legislating an increased voice for Aboriginal people and equitable rights of appeal for all parties. We believe that the focus should be on ensuring the progression of appropriate legislative reform in Western Australia rather than adding additional oversight or duplication at a Federal level.”^[7]

In light of the findings and recommendations of the Juukan Inquiry; our Company’s public statements; and the stated objections to the Bill by mandated First Nations organisations, it behoves our Company publicly to support First Nations peoples in their current calls to the Western Australian Government.

ACCR urges shareholders to vote for this resolution.