Indigenous business group accuses Ontario Securities Commission of ‘redwashing’

NEWS RELEASE

THE ANISHNAWBE BUSINESS PROFESSIONAL ASSOCIATION

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The Anishnawbe Business Professional Association (ABPA) has formally submitted a major position paper to the Ontario Securities Commission (OSC), challenging the regulator’s draft Action Plan for Truth and Reconciliation (APTR) as a dangerous exercise in “redwashing.”

The ABPA’s submission, titled “From Reconciliation to Regulation,” argues the OSC’s plan fails to protect investors by “almost entirely” avoiding its most powerful tool: its regulatory mandate. The ABPA asserts that this is not “social policy” but a core function of the OSC’s mandate, as corporate failure to engage with Indigenous Peoples and secure Free, Prior, and Informed Consent (FPIC) represents a “foreseeable and material financial risk” to investors.

The formal submission was also delivered to key federal and provincial ministers, including the Ministers of Finance, Crown-Indigenous Relations, and Natural Resources, as well as the Governor of the Bank of Canada. The letter was also sent to national First Nations leadership, including the Assembly of First Nations, Chiefs of Ontario, and major Indigenous financial institutions like the FNFA, FMB and NACCA, and the CEOs of Canada’s “Maple 8” pension funds.

“The OSC’s draft plan is an internal-facing exercise that risks becoming a textbook case of redwashing,” said Jason Rasevych, ABPA President. “This is not social policy; it is a core mandate issue. The failure to secure FPIC from Indigenous Nations is a foreseeable and material financial risk. When investors are not informed of this risk, they are exposed to catastrophic losses, and the OSC has a duty to protect them.”

The ABPA’s paper highlights incontrovertible evidence of these risks, citing major project failures like the Coastal GasLink pipeline, which faced years of delays and over $25 million in policing costs due to conflicts, and the Trans Mountain Pipeline Expansion (TMX), which was abandoned by its private proponent as “too risky” for shareholders, forcing a C$4.5 billion public buyout.

The ABPA’s position paper, grounded in analysis, concludes that the OSC already has the authority and duty to act. The submission calls for substantive regulatory actions to operationalize TRC Call to Action #92, including:

• Mandating Corporate Disclosure: Amending National Instrument 51-102 to require a dedicated “Indigenous Relations and Reconciliation” section in annual corporate filings (AIF and MD&A).
• Preventing “Redwashing”: Immediately using existing enforcement powers, citing the “greenwashing” case (OSC v. Purpose Investments) as a “directly analogous” legal precedent, to stop issuers from making misleading claims about Indigenous partnerships.
• Creating Equitable Capital Access: Co-designing a new “Indigenous Community Investment Prospectus Exemption” to address current rules that are “structurally incompatible” with First Nations’ collective economic models.
• Establishing a Formal Indigenous Advisory Council: Demanding a permanent, resourced body with a “co-development” mandate for policy, rejecting the OSC’s “tokenism” of treating Rights Holders as mere “stakeholders.”

Rachael Paquette, ABPA Vice President and lawyer, underscored the legal imperative for directors to act. “From a legal perspective, UNDRIP and the principle of FPIC have moved from abstract social policy to being enacted in legislation and must be considered by directors of corporations as an integral part of their duty of care,” said Paquette. “Director failure to authentically engage in FPIC could expose a corporation and its investors to foreseeable material financial risk or losses resulting from project delays due to legal challenges and/or cancellation.”

Jason Thompson, ABPA Treasurer, commented on the gap between corporate promises and actions. “What we have seen for too long is a mirage of economic reconciliation. A company cannot ‘redwash’ its operations by sponsoring a community festival while simultaneously ignoring its duty to obtain consent on a project,” said Thompson. “That’s not reconciliation; it’s a corporate social responsibility tactic. It’s time for companies to truly ‘walk the talk’ and accept that Indigenous Peoples are Rights Holders, not just another stakeholder group.”

Rasevych also highlighted the direct implications for development in Northern Ontario. “This is not a theoretical or faraway issue; this is critical for the future of the Ring of Fire,” he stated.

If regulators, investors, and proponents fail to learn these lessons and continue to treat Free, Prior, and Informed Consent as optional, they are setting the stage for conflict, delays, and project failure. Investors must be able to see—clearly and verifiably—that a company has done the real work of partnership, or their capital is at serious risk.”

“The legal authority is already there. The cost of regulatory inaction is demonstrably higher than the cost of compliance,” added Rasevych. “The primary barrier is not a lack of authority, but the institutional will to act. We have formally requested a meeting with OSC and CSA leadership to establish a timeline for this essential work.”

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