BP Venezuela Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

The challenge, the new goal for the new century must be not only
to supply the energy the world needs, but also to demonstrate that
we can do so in ways which are acceptable and enhance the life of
the community as a whole.
- John Browne, New York
17 November 1997

Indigenous Relations:
Meeting the Challenge – Responsibly and Sustainably

Prepared for: BP Venezuela
March 14, 1998

Prepared by: Wayne Dunn & Associates
2457 Bakerview Rd
Mill Bay, BC V0R 2P0
CANADA
Tel: +1-250-743-7619
Fax: +1-250-743-7659
info@waynedunn.com
www.waynedunn.com

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i Foreword & Acknowledgments

This report explores BP Venezuela’s relationship with Indigenous peoples. It is the result of
two weeks of field research 1 in Venezuela and draws upon the authors’ previous professional
experiences in working with business and with Indigenous development.

The authors would like to acknowledge the leadership of Mr. Ellis Armstrong and
Mr. Mike Daly of BP Venezuela, for having the foresight to realize the importance of
establishing sustainable, long term relationships with Indigenous peoples, and for having the
courage to give us complete latitude to undertake our research.

While everyone at BP Venezuela was very helpful and supportive, some deserve special
mention. The leadership of Cinzia de Santis and the enthusiastic support received from her
and her staff enabled the consultants to focus on their work without having to concentrate on
support and logistical details. As well, the support and the personal information and insights
provided by the environmental and health officers, Valentina Rodriguez, Jesús María Molina
and William Espinoza contributed greatly to our efforts. Additionally the information on the
Warao peoples, assembled by Walewska Miguel, was particularly useful.

The authors also wish to acknowledge the value of previous research reports and information
assembled through the efforts of BP Venezuela and other parties. Additionally, the
collaboration of the many other organizations and individuals we met contributed greatly to
our work. Finally, and perhaps most importantly, we would like to thank the Warao people
for allowing us to visit their communities and for taking time from their daily routines to
meet with us.

- Wayne Dunn

- Rodrigo Contreras

1
Appendix 1 contains a daily activity report covering the field research.

BP VENEZUELA March 1998
Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

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Table of Contents
i Foreword & Acknowledgments ........................................................................... i

1 Executive Summary ............................................................................................. 1

2 Introduction ......................................................................................................... 7

3 Background on Warao Peoples .......................................................................... 8
3.1 GENERAL AND HISTORIC ............................................................................................................. 8
3.2 LAND RIGHTS AND ISSUES .......................................................................................................... 9
3.3 CURRENT CONDITIONS OF THE WARAO .................................................................................... 10
3.4 WARAO AND OTHER INDIGENOUS ORGANISATIONS .................................................................. 11
3.5 INTERNATIONAL CONTEXT OF INDIGENOUS ISSUES .................................................................. 12
3.6 BP VENEZUELA’S INDIGENOUS RELATIONSHIPS TODAY ........................................................... 13
3.6.1 Current Strategy .............................................................................................................. 14
4 General Challenges ............................................................................................ 15

5 Development Technology .................................................................................. 16
5.1 WHAT IS DEVELOPMENT TECHNOLOGY? .................................................................................. 16
5.1.1 Analytical Framework ..................................................................................................... 16
5.1.2 Strategy ............................................................................................................................ 17
5.2 CORPORATE ETHOS: THE DEVELOPMENT TECHNOLOGY FOUNDATION .................................... 17
5.3 DEVELOPMENT TECHNOLOGY TOOLS: ...................................................................................... 18
5.3.1 Humanitarian Assistance/Direct Grants ......................................................................... 18
5.3.2 Leverage/Influence with Third Parties ............................................................................ 19
5.3.3 Training & Education ...................................................................................................... 20
5.3.4 Employment ..................................................................................................................... 20
5.3.5 Procurement .................................................................................................................... 21
5.3.6 Other Tools ...................................................................................................................... 23
5.3.7 Comparing the Tools ....................................................................................................... 23
5.4 DEVELOPMENT TECHNOLOGY RESULTS: MEASURING THE IMPACT ......................................... 26
6 Issues, Strategy & Recommendations .............................................................. 27
6.1 STRATEGY ................................................................................................................................. 27
6.2 ENHANCING THE CORPORATE ETHOS ........................................................................................ 28
6.3 DEPLOYING THE TOOLS............................................................................................................. 35
6.3.1 Humanitarian Assistance/Direct Grants ......................................................................... 35
6.3.2 Leverage/Influence with Third Parties ............................................................................ 37
6.3.3 Training and Education ................................................................................................... 40
6.3.4 Employment ..................................................................................................................... 44
6.3.5 Procurement .................................................................................................................... 46
6.3.6 Other Tools ...................................................................................................................... 48
6.4 SETTING TARGETS AND MONITORING RESULTS ........................................................................ 53
6.5 ADMINISTRATIVE ...................................................................................................................... 56
6.6 LIST OF ALL ISSUES ................................................................................................................... 58
6.7 IMPLEMENTATION FRAMEWORK MATRIX ................................................................................. 60
7 Short Term Action Plan .................................................................................... 61

8 Conclusion .......................................................................................................... 63


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Tables

Table 1 A Comparison of Development Technology Tools............................................... 25

Table 2 Implementation Schedule ....................................................................................... 60

Appendices (included in hard copy only)
1. Preliminary Report

2. ILO Convention 169

3. Reference Documents and Information Sources

4. BP Venezuela Draft Indigenous Policy (Spanish)

5. List of Documents Contained in Accompanying Document: Selected Articles,
Reports, Declarations and Findings on Indigenous peoples rights and economic
development interests and initiatives

Accompanying Documents 2

1. Selected Articles, Reports, Declarations and Findings on Indigenous peoples rights
and economic development interests and initiatives.

2
This is a selection of articles, reports, declarations and findings on Indigenous peoples rights and economic
development initiatives compiled by Wayne Dunn & Associates to provide BP Venezuela with immediate access
to additional background information.


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1 EXECUTIVE SUMMARY

Introduction

BP Venezuela, as the operator in a joint venture with the Venezuelan State oil company PDVSA,
was recently awarded an exploration concession in the Delta-Amacuro state in Venezuela. The
concession is on lands traditionally occupied by the Warao, a severely marginalized Indigenous
people. BP wants to establish sustainable and mutually beneficial relationships with the Warao
peoples and communities, and has initiated a number of activities and projects towards this end.
Wayne Dunn & Associates, an international consulting firm, was contracted to review the Warao
relationship and identify strategies and opportunities to further develop the relationship. This
report is a result of that engagement.

Background

The Warao Indigenous Peoples are the second largest Indigenous group in Venezuela, numbering
about 20,000. They inhabit small settlements throughout the Orinoco Delta and, as a result of
centuries of neglect and exploitation, are living under extreme pressures. Some of the more
alarming statistics are:

• The Warao have an average life expectancy of 34 years
• The Warao have a human development index of .2
• 99% of the Warao people are effectively illiterate
• 30% of Warao infants die before they reach one year of age
• 71% of Warao infants die before reaching 5 years of age (according to the
mothers, 48% of these deaths are from diarrhea)
• 100% of the Warao communities lack sewer and water services and most have no
access to potable water. (The Warao in the BP area have no access to fresh water
due to previous oil industry (non BP) activity which caused salt water to flood
into the delta channels approximately 30 years ago.)
• 97% of Warao adults do not have a fixed income

Although the Warao have almost no institutional capacity of their own, they are represented on
the Executive of Consejo Nacional Indigena de Venezuela (CONIVE), the National Indigenous
Council of Venezuela. Through CONIVE they are connected to other international Indigenous
organizations that participate actively in the growing international Indigenous agenda.

International interest in Indigenous issues has grown rapidly within the past twenty years. Multi-
lateral and international organizations are beginning to address the issue in a number of ways.
The International Labour Organization (ILO) has adopted Convention 1693, the United Nations

3
See Appendix 2 for a copy of ILO Convention 169


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has Declared 1994 to 2004 as the International Decade of the World’s Indigenous people and the
World Bank and many other bodies have adopted policies, directives and other mechanisms to
help them deal with the growing focus on Indigenous peoples.

As well, Indigenous organizations themselves are capably representing their issues and concerns
at national and international forums throughout the world. Recently, due to pressures from
Indigenous peoples, the scope of Indigenous issues has broadened and now regularly includes
business, economic development and trade concerns and opportunities. Despite the fact that
previous interactions between Indigenous peoples and business tended to be antagonistic, there
are emerging examples that demonstrate mutually beneficial collaboration between the two
groups.

BP’s Relationship with the Warao

From the very beginning of its operations in the Delta-Amacuro, BP has pro-actively worked to
establish mutually beneficial and sustainable relationships with the Warao peoples. Numerous
studies were commissioned and humanitarian programs in health and water delivery have been
implemented. Other programs and activities are underway to enhance the relationship, including
internal policy and strategy development and actively sharing information with other BP assets.
From senior executives to the field staff, a sincere desire to ‘do the right thing’ in BP-Warao
relations, is evident.

Despite having a positive and pro-active beginning to the relationship, there are still some
challenges that BP will have to overcome to achieve its goal of a long term, mutually beneficial
and sustainable relationship. BP will need to find a cost effective way to move beyond their
current approach and provide the Warao with opportunities for productive participation
(employment, procurement, etc.) in the exploration and production activities. Given the current
educational and experience level of the Warao this is a significant challenge. BP should begin
taking immediate steps to meet this challenge. If not, BP could easily find itself several years and
tens of millions of dollars into the project and having to explain why the impoverished Warao
have not received any of the employment and business opportunities from the development of oil
reserves on their traditional homelands.

BP Venezuela has already articulated a strategy and begun to put in place activities that will help
it to meet the challenges outlined above. This report will recommend enhancements and
additional initiatives to build upon the leadership BP has already demonstrated.

Development Technology

Resource companies such as BP are facing new challenges in their quest to develop resources
efficiently and responsibly. They must learn to collaborate across diverse cultural and
geographical dimensions, while at the same time balancing social and environmental
responsibility with short term profitability and long term growth. And they must do this under
increasing public scrutiny and with constantly shifting commodity prices.


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This report uses Development Technology, an analytical framework and a three pronged strategy
developed by Wayne Dunn & Associates, to suggest how BP can meet these new challenges in a
rational and cost-effective manner.

The three key elements of a Development Technology strategy are:

1. Developing a corporate ethos that facilitates working effectively across diverse
cultures
2. Understanding and deploying a set of tools to enhance local relationships by cost
effectively and sustainably increasing benefits accruing to local interests. These
tools are:
a) Humanitarian Assistance/Direct Grants
b) Leverage/Influence with Third Parties
c) Training & Education
d) Employment
e) Procurement

3. Measuring and monitoring the impact that operations and activities have on the
community and then using the information to implement a continuous
improvement process.

Our analysis revealed that, while BP has made a progressive start, there are significant
opportunities to cost-effectively enhance and improve long term relationships with the Warao
peoples through the implementation of a comprehensive Development Technology strategy. The
implementation of this strategy will focus increasing efforts on training and education,
employment and procurement while helping develop Warao capacity and collaborating more
effectively with Indigenous organizations and others involved in Warao development.

Strategy

The recommended strategy is:

To cost effectively and efficiently organize exploration activities so that they
support BP’s social responsibility objectives of contributing to the development
of civil society, environmental responsibility and maximizing the sustainable
benefits received by local interests.

The following recommendations outline the basic elements of the implementation of the strategy.


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Summary of Recommendations

We have identified 21 distinct issues that need to be addressed and have formulated 21 inter-
related recommendations to address the issues and support the implementation of the strategy
articulated above. The issues and recommendations along with individual implementation
strategies are detailed in Section 6. They can be summarized in four key points.

1. In order to effectively manage and maintain mutually beneficial relationships
with the Warao, it is critical that the entire BP Venezuela organization have an
enhanced ability to work effectively across diverse cultural dimensions.
Additionally, while BP has an impressive level of internal information on
Indigenous issues, it is necessary to consolidate that information in order to better
socialize it throughout the organization. As well, ongoing initiatives to continue
building and maintaining the information base are recommended.

2. BP should utilize its leverage with third parties in order to support its efforts with
the Warao. Additionally, various training, education, employment and
procurment initiatives should be developed and launched in order to maximize
opportunities for Warao to participate productively in BP’s activities. Some
resource companies in other areas have been particularly successful at this and
we are recommending BP personnel undertake a visit to see their operations
first-hand.

3. BP needs to establish direct relationships with representative Indigenous
organizations and motivate the establishment of a coordinating mechanism to
facilitate increased collaboration on Warao issues across a range of organizations
and institutions (including direct Indigenous participation)

4. Finally, in order to successfully execute the recommendations and objectives
outlined above, BP should establish quantifiable targets and objectives and
systematically monitor progress towards them.

Short Term Action Plan

The preceding strategy and recommendations form a comprehensive and integrated program. It is
important that the appropriate executives and staff review the analysis, strategy and
recommendations, amend them as necessary and arrive at a consensus regarding their
implementation. Many of the recommendations demand immediate attention and will need active
support from many quarters in order to be implemented effectively.

We recommend execution of the following 5 point short term work plan in order to facilitate
implementation in a timely, effective and coordinated manner.

1. In a one day, off-site workshop with key staff, consultants and a facilitator,
review the report and recommendations and develop a consensus on the
implementation.


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2. Revise/amend recommendations as necessary
3. Engage a consulting firm to assist with the implementation plan. In addition to
assisting with overall implementation, the firm should assume primary
responsibility for 4:
a) Cross cultural communications and sensitization program (design, develop,
train in-house delivery capacity, assist with delivery of initial sessions and
enhance as appropriate)
b) Facilitate the establishment of a direct relationship with CONIVE
c) Assist with identification of gaps in the internal Indigenous knowledge and
information base
d) Assist with supplementing the internal knowledge base as necessary
e) Assist with coordinating an observation visit to Cameco’s Canadian
operations
f) Assist with the identification of multi-lateral/international development
partners and collaborators
g) Assist with motivating the establishment of a coordinating mechanism
h) Provide ongoing review of emerging issues and challenges surrounding
BP’s Indigenous relationships and initiatives
i) Provide other assistance and support as required.

4. Proceed as quickly as possible with the following activities (or as revised in the
step 1 workshop):

a) develop and deliver cross cultural communications and sensitization
workshops
b) establish a direct relationship with CONIVE
c) motivate a community clean-up campaign
d) enhance and adopt BP’s Indigenous policy
e) visit Cameco’s Canadian operations to determine the applicability of
their experience
f) consolidate and enhance internal information and knowledge base
g) develop and implement a communications strategy (initial step is the
announcement of the program by the BP Venezuela President to give it
profile)
h) initiate an ongoing review of emerging issues and challenges related to
BP’s Indigenous relationships and initiatives

5. Implement the remaining recommendations as outlined in their respective
implementation strategies.

4
This may change depending of the specifics of the implementation plan adopted in item 1


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Summary

Benefits must accrue to the Warao through normal, ongoing operations and activities. Donations
and humanitarian relief on their own, while important initially, will not produce the results BP
requires. Warao people need the opportunity to become productively involved at all levels of
BP’s operations in Pedernales/Guarapiche. But, the reality of the situation is such that, without
focused effort and commitment, few Warao people will secure employment, training, or business
opportunities from BP’s operations. In addition to other considerations, BP cannot risk being
several years into the project and having extracted millions of dollars worth of oil without the
Warao people participating in the business and employment opportunities. For a public company
with BP’s profile and commitment to transparency and corporate social responsibility, this may
be an indefensible position.

Organizing activities and operations to facilitate productive Warao involvement in BP’s
operations represents a major challenge. To meet this challenge responsibly and sustainably will
require pan organization goal alignment around a comprehensive and integrated strategy that is
both far-reaching and cost-effective.


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2 INTRODUCTION

In order to better understand how it can enhance its relationship with the Warao peoples, BP
Venezuela contracted the international consulting firm of Wayne Dunn & Associates to review
the BP/Warao relationship and identify strategies and opportunities to further develop the
relationship along sustainable and mutually beneficial lines.

In order to fulfill this mandate two consultants, Wayne Dunn and Rodrigo Contreras, spent two
weeks (Feb. 1-14) in Venezuela conducting numerous interviews in both English and Spanish, in
order to research and evaluate the relationship. The consultants met with and interviewed; BP
staff and executives in Caracas, Maturin and Pedernales, spent several days visiting Warao
communities and territories, interviewed and met with numerous third parties including,
SOCSAL, Indigenous Parliament, Canadian Embassy, CONIVE, Inter-American Foundation,
Municipality of Pedernales, Indigenous Directorate of the Department of Education, Government
of Venezuela and PDVSA-the Venezuelan state oil company (a detailed work and activity report
is contained in Appendix 1). As a result of this field research a number of observations were
made and preliminary findings and insights were noted 5. A report BP and Indigenous Peoples in
Venezuela: Preliminary (Debriefing) Report, was prepared and presented to BP Venezuela
executives at a debriefing session in BP’s Caracas offices on February 13, 1998. This report is
attached as Appendix 1.

Following the field research in Venezuela, the consultants returned to their Canadian offices
where they have reviewed and analyzed the research, identified key issues and formulated a
number of strategic and operational recommendations designed to further enhance BP’s
relationship with the Warao peoples.

The following sections summarize the research, discuss the analysis and outline the
recommendations and their implementation strategy.

5
The observations and findings and insights are also contained in the above noted report.


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3 BACKGROUND ON WARAO PEOPLES

The following description of the Warao people of Venezuela, outlines the conditions in which
they live and gives an overview of BP Venezuela’s interactions with them. As well, it provides a
brief summary of pertinent international issues and developments that relate to BP’s Indigenous
relationships. The information was obtained from various reports commissioned by BP
Venezuela and others, and from various additional documents and information sources. A full
listing of documents and information sources is contained in Appendix 3. Additionally, a number
key reports, findings and documents have been compiled into an accompanying document 6,
copies of which were submitted along with this report.

The following information is essential as it presents the setting in which BP and others must work
and develop positive relationships with the Warao peoples.

3.1 General and Historic

The Warao people are the original inhabitants of the Delta-Amacuro State in Venezuela. They
are believed to have arrived during the early waves of South American immigration at least
10,000 years ago. There are approximately 20,000 Warao, occupying the shores of the Orinoco
Delta and living in settlements of fifty to three hundred people. The Warao are the second largest
indigenous population in Venezuela after the Wayuu people who live in the State of Zulia.

The Warao, like other traditional peoples, have depended for their livelihood on fishing, hunting
and gathering. They have historically maintained trade relations with their neighbors, including
the European settlers who came to dominate the surrounding land after European ‘discovery’ and
colonization. As long as the Warao could retreat into impenetrable and undesirable swamplands
of the Orinoco Delta, the structure of their society was not fundamentally altered. However, with
the growing impact of colonization and the discovery of oil on their traditional lands they no
longer have anywhere to retreat and today are generally living in sedentary communities. These
sedentary conditions and the direct and constant interaction with various actors, (missionaries,
anthropologists, government authorities, traders and businesses) is having a severe negative
impact on the Warao. Nearly always these interactions are top-down relationships with the
Warao receiving, at best, less than fair value for their contributions. The Warao tradition simply
does not prepare them to operate effectively in an institutionalized, monetary based economy and
they appear to have minimal understanding of government and other administrative procedures.
This situation is compounded by ongoing discriminatory practices, which preclude the Warao
from effective involvement in decisions affecting their lands and communities.

Today, after 10,000 years of successful existence in the Orinoco Delta, the Warao face a complex
set of pressures that threaten their very survival. On the one hand they have traditional
responsibilities such as the provision of social and economic support to family, the maintenance
of community structures, cultural continuity, and basic survival. On the other hand they are faced
with economic, academic and religious prospectors seeking resources, knowledge and their soul.

6
See Attachment 5 for a complete list


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In addition, the Warao must contend with the local, state, federal and international authorities’
relative lack of interest in their development.

A further complication and pressure on Warao people comes from the Narco-traffic that is
prevalent in the region. The Orinoco River provides a transportation corridor that takes narcotic
traffic, destined for the world market, directly past Warao villages and settlements.

The above discussion briefly illustrates the increasing economic and social pressures facing
the Warao people today and should be understood by all BP staff in order to develop
sustainable collaborative relationships.

3.2 Land Rights and Issues

Although many, including BP, refer to the land as ‘Warao territory’, the issue of Warao land
ownership or even their right to the use and occupation of the land is, at best, unclear. While it is
generally assumed that the region belongs to the Warao people on a symbolic basis, this does not
seem to give the Warao any specific land rights. It does not appear that they were even consulted
prior to the awarding of oil exploration concessions.

Article 77 of the present Venezuelan Constitution concedes land for Warao use or occupation
without legalizing any title. This article mandates the government to improve the conditions of
peasants with special provisions, where appropriate, to protect indigenous peoples and to permit
their progressive incorporation to the life of the State. In specific reference to the Warao people,
the Venezuelan Government upholds the Guarapiche decree whose basic objective is the
establishment of a Forest Reserve Plan and the maintenance and protection of the indigenous
Warao and Kariña, including their occupation and usage of the area.

ILO Convention 107 7 (1957), which was ratified by Venezuela in 1983, contributes to the
protection of indigenous land by recognizing the common or individual right of land ownership
for the land traditionally occupied by them (Article 11). Article 12 of Convention 107 goes
further by stating that it is not possible to transfer local populations without their approval.

The Venezuelan Presidential Decree 250 (1951) regulates access to Indigenous areas. According
to this decree, all non-Indigenous persons or institutions wishing to visit Indigenous lands must
obtain special permits from the department of Indigenous Affairs (which is presently under the
authority of the Ministry of Education). However, this decree is rarely applied, allowing
outsiders unfettered access to the Warao people and territory.

According to the last census in 1992, 72% of Venezuelan indigenous communities do not claim to
possess any land title whatsoever. Those claiming to have titles generally do not understand what
level of legal ownership they may have. The percentage of legal land ownership in Warao
communities is even lower than it is in the general Venezuelan Indigenous population.

7
ILO Convention 107 has been superseded by ILO Convention 169 – see Section 3.5 for additional discussion on
Convention 169


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3.3 Current Conditions of the Warao

In addition to documenting Warao people’s cultural characteristics and their historically unequal
relationships with the dominant society, the plethora of reports all comment on the deplorable and
unacceptable economic and social conditions in which the Warao exist today.

Some of the more alarming statistics contained in these reports and articles include:

• The Warao have an average life expectancy of 34 years
• The Warao have a human development index of .2
• 84% of the Warao people have no formal education
• 99% of the Warao people are effectively illiterate
• 30% of Warao infants die before they reach one year of age
• 71% of Warao infants die before reaching 5 years of age (according to the
mothers 48% of these deaths are from diarrhea)
• 100% of the Warao communities lack sewer and water services and most have no
access to potable water. (The Warao in the BP area have no access to fresh water
due to previous oil industry (non BP) activity which caused salt water to flood
into the delta channels approximately 30 years ago.)
• Virtually all Warao people exist in a subsistence economy and are heavily
exploitated by outsiders
• 97% of Warao adults do not have a fixed income

These conditions demand urgent action from all actors involved in the development of the region.
Governments, international agencies, non-governmental organizations (NGOs), resource
companies, local authorities and, most importantly, the people themselves must be involved in
changing this situation. Sanitation, education and training, health, nutrition, water supply,
economic development capacity, environmental protection, income generation, business
opportunities and sustainable development are just a few of the areas needing immediate
attention.

The reports and information noted above are common knowledge and are of great concern to all
actors in the region. There is movement towards the initiation of action to begin to alleviate these
conditions. BP launched several specific programs focusing on enhancing health, ensuring water
supply and establishing medical facilities and treatment programs. These initiatives are seen as
positive steps, especially given the short time BP has been active in the area. But, more needs to
be done if BP is to meet the challenge of profitably developing the oil reserves, while maintaining
mutually beneficial and collaborative relationships with Warao people and their communities.

If BP Venezuela is not involved in successful efforts to alleviate the condition of Warao people, it
will leave itself very vulnerable to public criticism, especially from those groups and individuals
that are intent on terminating oil development in the area. An additional concern for BP is the


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possibility that adverse publicity on the BP/Warao situation could erode the goodwill generated
through BP’s progressive stance on environmental responsibility.

3.4 Warao and other Indigenous Organisations

Warao people and communities interact and conduct communication through an ad-hoc system
based on traditional practices and encounters. There is not a formally established Warao network
or institutional structure and community representation is basically on an individual basis, with
little institutional structure. There is an incipient effort to establish networking and coordinating
capacity through a union of Warao communities. This effort, called the Warao Union, attempts to
express the views and concerns of the Warao to CONIVE, the National Council of Indigenous
Peoples of Venezuela.

CONIVE was established in 1990 to support the aspirations of Indigenous peoples in Venezuela
and to promote Indigenous unity. CONIVE addresses issues such as land tenure, human rights,
environmental management, economic development and resource development. A key objective
is the effective participation of Indigenous peoples in all affairs of Venezuelan society. CONIVE
operates with an executive body and with representation from regional Indigenous organizations
such as the Warao Union. They hold membership in the Coordinating Body of the Amazon Basin
(COICA) and maintain close working relations with the World Council of Indigenous Peoples
(WCIP). Both COICA and WCIP are active participants in international Indigenous processes
and activities (see next section for detailed discussion of these activities). CONIVE has followed
the United Nations and other international Indigenous processes and activities closely, but its
active participation has been sporadic, largely due to lack of financial and technical capacity.
CONIVE has, at best, only minimal core financing, which limits its capacity to carry out its
objectives.

Although recent progress has been made, we find there are few examples of collaborative efforts
between private industry and Indigenous organizations such as CONIVE. In fact, in many cases,
past relationships have been antagonistic. Despite these difficulties, Indigenous organizations are
seeking innovative relationships with industry 8, where their concerns can be fully taken into
account. CONIVE has indicated a willingness to enter into dialogue with BP and other firms, to
explore opportunities for meaningful participation in the oil industry. This is a significant
development and represents a valuable opportunity for BP to establish direct relationships with
CONIVE.

8
For many years international attention on Indigenous issues has focused on Human rights, culture, environment and
other related areas, while paying little attention to income generation and business development. However, in recent
years, Indigenous peoples throughout the world have been expressing growing interest in business and economic
opportunities. The accompanying document, Selected Articles, Reports, Declarations and Findings on Indigenous
peoples rights and economic development interests and initiatives contains a number of reports and articles related to
Indigenous peoples business and economic development. Perhaps José Oritz of Costa Rica, speaking in Copenhagen,
Denmark at the Nordic Council of Minister’s Seminar on Indigenous Production and Trade (1995) said it best, “A
culture that cannot be financially self sufficient will die”.


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3.5 International Context of Indigenous Issues

The past twenty years (and particularly the last ten) have seen a remarkable amount of interest in
Indigenous peoples and their concerns and issues. This has been translated into policy and action
by multi-lateral and international development agencies, NGOs and to a lesser degree by nation
states 9 and private businesses.

In June 1989 the International Labour Organization (ILO) adopted Convention 169 Indigenous
and Tribal Peoples Convention. To date, this is known as the only international instrument that
addresses Indigenous human rights and their economic, social and cultural concerns. The United
Nations (UN) and the Organization of American States (OAS) are in a process of discussions for
possible adoption of their respective declarations on the rights of Indigenous peoples.

Multi-lateral agencies such as the World Bank, the Inter-American Development Bank (IADB),
the United Nations Development Programme (UNDP), the World Health Organization (WHO),
the Pan American Health Organization (PAHO) and the United Nations Children’s Fund
(UNICEF) have also issued policy guidelines and directives that attempt to respond to the needs
and concerns of Indigenous peoples. As well, there have been numerous conferences, workshops
and speeches calling for the establishment of a permanent UN Forum for Indigenous peoples.
The United Nation’s proclamation of the International Year of the World’s Indigenous People in
1993 and the subsequent proclamation of the International Decade of the World’s Indigenous
People (1994-2004) also illustrate growing international interest in Indigenous issues.

Additionally, the international attention focused on environmental concerns often includes
Indigenous issues as well. The Rio process (United Nations Conference on Environment and
Development [UNCED]) culminated in agreements such as Agenda 21, Chapter 26 & 37 which
deal with Indigenous issues and capacity building. As well the United Nations Environment
Programme’s Convention of Biological Diversity produced an agreement in which two articles
8(J) and 10(C, D & E) deal specifically with Indigenous peoples issues. The protection of
Indigenous lands and territories, the use of traditional knowledge, the need for sustainable
development and for Indigenous participation in the resources on their lands are dealt with in
these articles 10.

In addition to the above, nation states are coming under increasing pressure to deal with
Indigenous land rights and other Indigenous matters. Also, a growing commitment to social
responsibility is motivating some businesses to take increased interest in Indigenous issues and
concerns. The environmental review process and the increasing public scrutiny of resource
projects are forcing many other businesses to come to terms with Indigenous peoples’ concerns.

9
For the multi-lateral documents noted in this section the authors acknowledge relying on the analysis contained in The
Rights of Indigenous Peoples Under International Law: Selected Issues, a paper prepared by Fergus MacKay. This
paper is reproduced in the accompanying document, Selected Articles, Reports, Declarations and Findings on
Indigenous peoples rights and economic development interests and initiatives.
10
Copies of above referenced documents and reports are contained in the accompanying document, Selected Articles,
Reports, Declarations and Findings on Indigenous peoples rights and economic development interests and initiatives.


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Indigenous peoples themselves are becoming increasingly proactive in defining their own future.
Where previously, Indigenous issues were often limited to human rights and environmental
dimensions, a new generation of well educated and articulate leaders are defining Indigenous
issues in the broadest possible terms. Today you will find Indigenous peoples involving
themselves across the full range of human endeavors. As noted previously, there is also a
growing interest in Indigenous business and economic development. There have been a number
of recent international events focusing on this arena. Reports and recommendations from many
of these are contained in the accompanying document.

These issues and developments are generating a global climate where companies operating on
Indigenous lands or in proximity to Indigenous peoples must learn to collaborate efficiently
and effectively. Resource companies must learn how to organize their activities so that
Indigenous peoples are partners in the process and receive real and meaningful benefits.
Companies that fail to learn how to do this effectively will find themselves under increasing
pressure from all quarters.

3.6 BP Venezuela’s Indigenous Relationships Today

The recent opening of petroleum exploration concessions in Venezuela has allowed BP to
establish an exploration presence on traditional Warao territory in the Delta-Amacuro area. The
company has commissioned research to enable better understanding of the Warao and has made
effective efforts to establish meaningful relationships with them.

As BP came to understand the dire conditions of the Warao, it moved very quickly to provide
emergency humanitarian services through programs to assist nearby communities. These
included; direct delivery of water, provision of medical and health services and construction of
medical facilities. As well, BP is supporting NGOs such as SOCSAL that are attempting to
facilitate education, health and economic diversification initiatives for Warao people and
communities.

BP has taken the additional steps of consulting with other BP operations that work on Indigenous
lands, in order to learn from their experience. BP’s operations in Alaska and in Papua New
Guinea have strongly recommended that actions be based on a consultative process with local
peoples. We also note that BP has established a staff position to coordinate Indigenous programs
and has enabled this person to attend various national and international conferences and
workshops to gather information. Another progressive action by BP is the development of a draft
policy statement on Indigenous Policy 11.

We also noted strong goal alignment within the BP Venezuela organization around “doing the
right thing with respect to the Warao people”. This sentiment, which was originally expressed to
us by BP Venezuela President Ellis Armstrong, was evident in all discussions with BP personnel.
This is exemplified by BP’s actions, which demonstrate a forward-looking approach and
committed efforts to respond respectfully to a delicate situation.

11
See Appendix 4 for a copy of this policy.


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3.6.1 Current Strategy

BP Venezuela recently articulated a three point strategy for its relationship with the Warao. The
strategy involves:

1. Gaining community trust by operating in a consultative and transparent manner
while continuing with the ongoing implementation of high impact water and
health programs
2. Create favourable public opinion by obtaining third party endorsements,
developing strategic alliances and undertaking a communications and public
relations program
3. Promote sustainable development through the development of a fisheries
programme and ongoing evaluation of other economic opportunities.

Additionally, BP has identified the need to:

(a) continue pro-actively developing its relationships with local communities,
(b) continue developing a deep understanding of Warao people
(c) improve the management and measurement of social programme performance in
the same way as Health Safety and Environment are currently managed and
measured
(d) strengthen NGO alliances.

Success has been defined by BP as: “BP being wanted by the community”.

We note that BP Venezuela’s progressive actions to establish sustainable relationships with the
Warao peoples are echoed by Group Chief Executive, John Browne in an October 1997
presentation on Corporate Responsibility in an International Context

“Everywhere we work we try to contribute to the development of civil society . . .
ensuring that the whole of the local community benefits from our presence, and
bringing some positive energy to the development of the community and its
institutions.”

The recommendations presented later in this document are designed to enhance and build on BP’s
current strategy and activities.


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4 GENERAL CHALLENGES

BP will face many challenges as it strives to develop a long-term, mutually beneficial and
interactive relationship with the Warao people. Some key challenges that BP should be aware of
include:

• Developing a workforce (including contractors and staff) that is able to work
effectively across diverse cultural dimensions and that fully understands the
importance of good relations with the Warao people and communities
• Overcoming the distrust created by centuries of exploitation that the Warao have
suffered at the hands of state, religious, business and other outside interests.
• Managing the expectations of the Warao people.
• Overcoming the Waroa peoples’ low levels of literacy and their lack of
organizational and institutional capacity, in order to develop a truly inter-active
dialogue and mutually beneficial relationship with them.
• Overcoming Union agreements, Warao education and skill levels, and other
obstacles in order to offer Warao peoples real opportunities for meaningful
involvement in all aspects of BP’s operations.
• Collaborating effectively with NGOs, government agencies, international actors
and others involved in the development of the Warao area
• Maintaining a positive public image for its relationship with the Warao and
avoiding international criticism. The deplorable situation of the Warao people
will not change overnight, regardless of what BP does. BP is not responsible for
the current condition of the Warao, yet there is always a risk that the media and
other interests will try to make that connection.
• Doing all of the above in a cost effective and efficient manner

The way forward will not be easy for BP as it strives to overcome historical issues, and organize
its activities to enable the Warao to be willing beneficiaries of BP’s presence in the region.

“The cutting edge of the issue of corporate responsibility comes from the fact
that circumstances don’t always make it easy for companies to operate as they
would wish.”
- John Browne, Oct-97

While we understand that the challenges are immense, we do believe that building on BP’s
current efforts and adopting the approach outlined in Section 6 will make the challenges
surmountable.


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5 DEVELOPMENT TECHNOLOGY

Resource companies such as BP are facing new challenges in their quest to harvest resources
efficiently and responsibly. They must learn to collaborate across diverse cultural and
geographical dimensions, while at the same time balancing social and environmental
responsibility with short term profitability and long term growth. And they must do this under
increasing public scrutiny and with constantly shifting commodity prices. Wayne Dunn &
Associates has constructed an analytical framework called Development Technology, to support
resource companies’ efforts to meet these new challenges.

5.1 What is Development Technology?

Development Technology is an analytical framework and a three pronged strategy developed by
Wayne Dunn & Associates to assist resource companies to meet these new challenges in a
rational and cost-effective manner.

5.1.1 Analytical Framework

The key elements of a Development Technology analytical framework are outlined below.
Additional information on the elements, and a discussion on their applicability to BP’s
relationship with the Warao peoples, is included in the following sub-sections.

1. Does the corporate ethos facilitate working effectively across diverse cultures
2. Does the company organize normal ongoing activities and operations in a way
that provides meaningful benefits to local people and communities in an efficient
and cost effective manner. The analysis involves sifting contracting, purchasing,
hiring and other activities through a screen of questions such as:
• How much local hiring is done and how can it be increased?
• What, if anything, needs to be done (i.e. health, education, union
agreements, hiring processes, etc.) to eliminate barriers which prevent
local people from becoming productively involved in the project?
• Can others (governments, development agencies, etc.) be influenced to
collaborate in maximizing local benefits, or influenced to undertake
supportive development activities on their own?
• Given the timeframe of the development, what sorts of education and
training initiatives will best enable local people to be productively
involved in the project?
• Can local suppliers be developed for the goods and services the project
will need?
• Can contracts and subcontracts be organized to provide more local
benefits and more opportunities for productive local involvement?


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3. Does the current process of measuring and monitoring the impact that operations
and activities have on the community effectively support the corporation’s
community relations objectives.

5.1.2 Strategy

The three key elements of a Development Technology strategy are outlined below.

1. Developing a corporate ethos that facilitates working effectively across diverse
cultures
2. Understanding and deploying a set of tools to enhance local relationships by cost
effectively and sustainably increasing benefits accruing to local interests. These
tools are:
a) Humanitarian Assistance/Direct Grants
b) Leverage/Influence with Third Parties
c) Training & Education
d) Employment
e) Procurement

3. Measuring and monitoring the impact that operations and activities have on the
community and using the information to implement a continuous improvement
process.

An analysis based on the Development Technology analytical framework is contained in the
following subsections and the resulting strategy and implementation plan is outlined in Section 6.

5.2 Corporate Ethos: The Development Technology Foundation

Companies wishing to prosper in today’s global village economy must have the ability to work
effectively in diverse cultural settings. This is especially true for resource companies operating
on lands where the traditional Indigenous inhabitants are severely marginalized and suffer from a
history of exploitation. Companies in this situation, even those with the best of intentions, are
often unable to develop effective relationships with local peoples.

Many corporations and their personnel are prone to making broad cultural generalizations on the
basis of their own educational and experiential background. These generalizations are often made
with the best of intentions, and are the result of a limited scope and understanding of other
cultures and perspectives. Should these generalizations continue unchecked they will reflect
poorly on the company and impair chances for maintaining sustainable, mutually beneficial
relationships. For a company such as BP to work effectively in an area like the Orinoco Delta it
is imperative that all personnel (including sub-contract staff) have an understanding of cross
cultural issues and an understanding of the importance of maintaining good relationships with the


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Warao peoples. In order to have the pan-operation goal alignment that is necessary to maintain
good Warao relationships, every employee should receive exposure to cross cultural training and
understand the importance of Indigenous relationships, much the same as every BP employee
now receives some level of environmental education and security awareness. Good local
relationships are the result of all departments and units understanding and contributing to the
process.

The effectiveness of any development technology tool depends greatly on the attitude and
approach that is used when implementing it. If people who are well versed in cross cultural
communications practices, use the tools with a genuine attitude of mutual respect and
collaboration, they will tend to be effective. However, if they are deployed with a sense of pity
and guilt, by people who see themselves ‘saving’ the poor Indigenous peoples, the tools will have
little long term positive impact.

5.3 Development Technology Tools:

The following sub-sections will look at the various development technology tools available to
resource companies and discuss their appropriateness for use by BP in its relationship with the
Warao peoples. A summary Table at the conclusion of this section will compare the tools along
key performance dimensions. It is worth reiterating that the tools are externally focused and will
achieve sub-optimal results unless they are based on a strong corporate foundation of cross
cultural sensitivity. Detailed recommendations on the utilization of the tools are contained in
Section 6.

5.3.1 Humanitarian Assistance/Direct Grants

Often companies see humanitarian aid (financial donations, health programs, supporting
community charities, etc.) as the key tool that can provide benefits to severely marginalized
communities. While humanitarian aid and direct grants are often necessary to resolve immediate
concerns, the impact is generally temporary and unsustainable. On their own, humanitarian aid
and grants will not develop the mutually beneficial, interactive collaboration that BP is seeking
to develop with Warao people and communities.

While humanitarian aid is often a necessary starting point, by its very nature it is unsustainable
and demeaning to its recipients. Programs are often delivered with a paternalistic approach that
fosters further dependency and endless expectations. A primary aim of humanitarian assistance
should be to support efforts to enable improved application of the other, more sustainable tools.
Carrying out humanitarian and charitable programs, without providing local people with
opportunities to be productively involved (i.e. employed or supplying goods and services) is
demeaning, unsustainable and, in the long term, will foster resentment and ill will. No one,
regardless of cultural background, wants to simply receive charity. Minimizing or dismissing the
use of the other tools (employment, training, procurement) deprives both the company and the
communities of the more sustainable (and cost effective) benefits that they can provide 12.

12
This is not to say that humanitarian and charitable programs should not be used – only that one must be aware that
other tools can better produce sustainable long-term benefits.


- 19 -

The health and water delivery projects that BP has initiated can begin to create a foundation from
which other, more sustainable activities can be developed. However, BP must begin immediately
to develop mechanisms that will ensure that those Warao who want to be productively involved
in BP’s operations will have every opportunity to do so.

Program Delivery by Third Parties
In some cases third parties such as NGOs can provide the most effective mechanism for the
delivery of humanitarian and charitable programs. Another approach is to cost share the program
with a government or other agency that has effective delivery capacity. While there is nothing
inherently problematic with third party delivery, and it sometimes offers the most effective
program delivery mechanism, corporations must understand the danger of relying on third parties
for all programs.

Considerations for Third Party Delivery
Although Indigenous issues have often surfaced through environmental considerations, there is a
significant difference between the two issues. BP should ensure that any third party delivery
agents it collaborates with on Indigenous issues have the requisite knowledge and experience in
delivering Indigenous development programs. Potential collaborators should be cognizant and
comfortable with the full range of Development Technology tools.

It is important that companies like BP interact directly with Warao people and communities. This
is beneficial for BP’s image and it also provides a valuable source of direct information that will
help BP remain knowledgeable about Warao communities and peoples.

5.3.2 Leverage/Influence with Third Parties

As John Browne noted in his November 1997 presentation to the Council on Foreign Relations in
New York, corporations have a responsibility to ensure that resource development provides
discernible advantages for local communities. But, the reality is that corporations do not have
primary responsibility for the well being of Indigenous and other marginalized peoples and
communities. While there is no doubt that corporations do have responsibilities, the primary
responsibility rests with the people themselves and with various levels of government.

However, as noted in the background information, often local peoples have been marginalized for
so long that they lack the institutions and capacity to exercise their responsibility effectively.
And, often international organizations and national, state, municipal and other governments have
not taken the steps necessary to allow Indigenous peoples to be full partners in society.

Corporations such as BP are in a position of influence with governments and other parties who
have responsibilities for Indigenous peoples. BP’s collaboration with various governmental and
international health programs is an example of how this leverage and influence can be used
effectively. BP has a number of other opportunities to utilize its influence to assist the Warao in
their development efforts. Of significant importance is BP’s ability to require its contractors and
agents to develop an understanding of the Warao peoples and to organize their activities in ways
that can produce tangible benefits for the Warao peoples.


- 20 -

5.3.3 Training & Education

We will only have true development and full human rights when individuals have
freedom from poverty and the freedom to develop their skills, as well as the
freedom to express their views.
- John Browne, Oct-97

Training and Education provide the capacity that enables that freedom. Illiteracy and lack of
educational opportunities are characteristic of the Warao people and communities. In community
after community few children attend school for longer than two or three years and the effective
illiteracy rate is close to 100%. Corporations that are working to establish mutually beneficial
relationships with these communities must support education and training for all ages. Education
and training are absolutely necessary to support long term capacity development.

Education and training initiatives, especially in the case of the Warao, should occur along a range
of dimensions. Working in cooperation with existing educational institutions, the facilities and
resources to support and encourage the basic education of Warao must be put in place. This is an
excellent example of where BP can use its leverage and influence with others (governments,
development agencies and donor countries and NGOs) to supplement BP’s own resources.
Education and training initiatives that will assist the Warao peoples in their daily activities should
be encouraged and supported. As well, BP must develop and implement training initiatives that
will ensure that those Warao who want to be productively involved in BP’s activities, will have
an opportunity to acquire the capacity that will allow them to do so. Additionally, as BP begins
to have more local people productively involved in its activities, it should consider providing
them with ongoing training and educational opportunities such as offering adult basic education
at the jobsite.

Currently, due to a number of factors including lack of financial support, almost no Warao go on
to take advanced education and training. If there is to be a sustainable, long term change in the
situation of the Warao peoples, they will require well educated leaders. BP could facilitate this
process through a scholarship program targeted at encouraging Warao people to pursue advanced
studies and training.

5.3.4 Employment

Hiring of local people must be a key tool in any corporation’s community relations strategy.
Unfortunately, especially in the case of remote Indigenous communities, hiring is often
overlooked or deliberately discouraged. It is often assumed (many times on the basis of casual
conversations and anecdotal information) that Indigenous peoples just want to continue their
traditional lifestyles and are not interested in employment. This is a risky and expensive
assumption that has been proven wrong many times. While it is true that many Indigenous
people will want to continue traditional lifestyles, there will be some who will want to be
productively employed in the industry. And, as has been demonstrated over and over again in
Canada and elsewhere, resource industry employment and traditional Indigenous lifestyles are not
mutually exclusive.


- 21 -

Hiring and recruitment efforts are also a very cost effective and sustainable way to provide local
benefits (see Table 1 Section 5.3.7 for a detailed comparison of the tools). Unlike humanitarian
aid, where benefits are generally unsustainable and on a one to one ratio with expenditures (i.e.
every dollar spent on the program produces a dollar of community benefit) local hiring programs
are incremental in nature, producing benefits that outlast and greatly exceed program
expenditures. A local employment strategy will not produce overnight results, but it will produce
sustainable, long term results. This is precisely why it should begin in the early stages of a
project and have measurable objectives.

Pre-Employment Training Programs
Pre-employment training programs have proven to be an effective strategy to bring prospective
employees up to required educational standards and provide corporations with a qualified pool
from which to draw new recruits. Additionally these programs provide a pre-screening
mechanism to ensure that investments in employee training are directed at those people most
likely to continue working with the company over time.

Often resource companies operating in remote regions will be providing people with their
first-ever salaried employment. A pre-employment training program helps potential recruits
achieve a position where they are prepared to begin employment. Potential employees are
brought together in a situation that is as similar as possible to the real work environment. While
together they undertake necessary training, upgrading and orientation. Pre-orientation training
program elements often include:

• Adult Basic Education
• Life Skills Training
• First Aid and Safety Training
• Visits to appropriate worksites
• Family awareness (bringing other family members to orient them on the realities of
having a family member involved in salaried employment)

Some companies have found that pre-employment training programs have more than doubled
their ability to hire people from local, marginalized communities. As well, they have found that
the turnover rate for employees regularly drops by more than 50%, because prospective
employees have an opportunity to learn more about the reality of the work situation and many
who would not remain employed self-select out of the program.

5.3.5 Procurement

Developing local suppliers of goods and services in remote, marginalized and under-developed
communities is generally very difficult. But, it is a necessary and vitally important component of
any development technology strategy.

Resource companies regularly procure millions of dollars worth of goods and services for the
development and operation of a project. These purchases have the potential to produce an
immediate impact on local economies. And, over the longer term they can help the local


- 22 -

economy develop the capacity to capitalize on the roads, airports and other local infrastructure
improvements that often accompany resource development. For example, an improved airport
and increased local activity may create opportunities to develop tourism businesses. However, if
the local economy does not have sufficient business capacity, it is unlikely that a local interest
will be able to capitalize on opportunities like this. A local procurement strategy can, over time,
create the capacity in the local economy to develop new business opportunities that are not
directly dependent on the resource industry.

Unfortunately, many companies overlook or discount the potential to develop local suppliers of
goods and services. Often local communities, like the Warao, are marginalized and have no
immediately evident capacity to supply goods and services. Seldom are the people involved in
procurement activities given the tools or the encouragement to develop local suppliers. As well,
in the short run it may well be easier and less expensive to procure goods and services from
traditional sources. Additionally, as with employment, the assumption is often made that
Indigenous peoples would sooner maintain their traditional lifestyles and are generally not
interested in supplying goods and services to resource industries. This assumption is risky,
expensive and false. A strategy of increasing local procurement will pay off, regardless of the
local people’s initial capacity to supply goods and services.

A Local Procurement Success Story
Cameco, a gold and uranium mining company, was able to move from zero to approximately $75
million in local procurement over a ten year period. Ten years ago, Cameco’s was purchasing
almost no goods and services from local suppliers for its operations in northern Saskatchewan,
Canada. There were minimal local business capacity and high rates of illiteracy in the isolated
local Indigenous communities. But, with a focused effort and a long term strategy, Cameco is
now purchasing close to $75 million in goods and services from northern Saskatchewan’s 33,000
inhabitants (75% of whom are Indigenous). At the same time, Cameco has increased its local
hiring to the point where 86% of new employees are local residents. The company employs over
500 local Indigenous people, paying them over $20 million/year in salaries. All this was
accomplished in a remote, isolated area where, initially, the people were largely untrained and
unskilled and living traditional lifestyles. We will recommend that BP arrange a visit to
Cameco’s Saskatchewan operations to identify specific elements of Cameco’s programs that
could be applicable to BP’s operations in Venezuela and elsewhere.

Admittedly, there are many differences between the Cree and Dené of northern Saskatchewan and
the Warao of the Orinoco Delta. But, there are also many similarities. Indigenous peoples in
both places have experienced exploitation and marginalization over long periods of time. By
accepted measurements their development was far below that of the surrounding non-Indigenous
community. Both peoples had almost no previous positive experience with business or industry.

Cameco realized that investing in local procurement and employment programs was a cost
effective deployment of community relations spending. Dollar for dollar, spending to increase
local procurement and employment can have a much larger and longer term impact on local
economies than humanitarian and charitable spending.

Local procurement and joint-ventures
Joint venturing with partners who have the necessary capacity and operational expertise has
proven to be an effective way for some Indigenous peoples to provide goods and services to
resource projects. Cameco has promoted the use of this strategy effectively, helping to bring the


- 23 -

partners together and facilitate arrangements. This has allowed them to award multi-million
dollar underground mining, catering, transportation and other contracts to Indigenous businesses
that had little previous experience in these sectors.

The current level of Warao institutional and organizational capacity will be a limiting factor in
allowing near term development of joint ventures. However, by focusing on opportunities rather
than constraints, it may be possible to identify an opportunity whereby a joint venture approach
could assist in developing a Warao supplier. Given the Warao peoples’ proven expertise in living
effectively in the region, BP may want to examine its environmental monitoring and management
activities to determine if there is an opportunity to allow for direct Warao involvement.

If companies such as BP are to ensure that resource development occurs in a mutually beneficial
manner, increasing local procurement is both necessary and cost effective. Furthermore, five or
ten years into the development of the field it would be very difficult to justify why local Warao
peoples were not involved in providing goods and services.

5.3.6 Other Tools

In addition to the tools listed previously, there are a number of additional activities and strategies
that will help local resource projects to produce long term, sustainable benefits for local
communities and people. We will be recommending that BP utilize some of the following tools
to enhance its relationship with the Warao peoples.

Capacity Building
Increasing local organizational and institutional capacity is absolutely necessary in order to have
a long term, interactive relationship with local Warao communities.

Mechanism(s) to facilitate local involvement and benefits
Ensuring that resource projects produce local benefits is the responsibility of many parties, not
just the resource company. There needs to be a mechanism(s) to facilitate communication and
collaboration between the various actors. (Note that in order for this mechanism to be effective
the participants must have a basic level of organizational and institutional capacity). These
mechanisms can take various forms and can include a range of actors. For instance, Cameco, in
its operations in the Athabasca region of Saskatchewan’s far north (which is one of the most
marginalized areas in Canada), facilitated the creation of the Athabasca Working Group. This
group brings together industry, government, community leaders and other interested parties. Its
overall objective is utilizing the mining industry to improve 13 life in the communities. Among
other results, in the 3 years since the group was formed there has been a 60% increase in local
employment.

5.3.7 Comparing the Tools

There is an appropriate time and situation for each of the Development Technology tools
discussed previously. Often the impact can be increased, by utilizing the tools together, or by

13
The communities themselves are the only ones that can legitimately define what improvement means.


- 24 -

using one to build the capacity to enable the effective use of others (i.e. supporting basic health
and education to increase the impact of later training, hiring and procurement efforts). What is
important is to understand the impact of the tools along several key dimensions. The following
chart will illustrate the aspects of the various dimensions. Table 1, a matrix that compares the
development technology tools across the impact dimensions follows this chart.

Self Sustaining: Will the initiative generated by the tool eventually be self-sustaining,
or will it require ongoing investment from the company or others?

Enhances Self Esteem: Will the impact created by the use of the tool enhance individual and
community self esteem?

Builds Capacity: Does the tool help to build sustainable long term capacity

Builds Partnership: Is the initiative inter-active enough that it creates a sense of partnership
with the local people and community?

Return on Investment: What is the value of community benefits per dollar invested?


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Table 1 A Comparison of Development Technology Tools
Self Sustaining Enhances Self Esteem Builds Capacity Builds Partnership Return on Investment
Humanitarian aid No, but often necessary In the short term it can in In the short term Can build initial sense of Low, with little or no
and Direct Grants initially in order to some situations, but often perhaps, but not long partnership and trust if leverage. Return usually
create a foundation for it will foster long term term sustainable designed and ceases when contribution
the successful dependency capacity. Also it has a implemented finishes
implementation of other tendency to foster appropriately
tools dependency
Leverage/Influence Can be if the influence Can if appropriate Can if activities of third Can, if leverage is done Can be high if influence
with Third Parties causes third parties to activities are undertaken parties are appropriate collaboratively with results in third party
adopt and implement (i.e. legislation, local people and based investment in new activities
sustainable long term development actions, etc.) on community priorities that provide ongoing
approaches community benefits
Training No, but when trained Yes Yes Can, especially if High. Small investment in
people can go on to development and training can produce
other self sustaining selection is undertaken ongoing return through
activities with community continued employment
collaboration.
Hiring Yes Yes Yes Yes High – small investment to
increase local hiring can
produce ongoing salary
revenues into community
economy
Procurement Yes Yes Yes – especially if Yes Very high
procurement activities
are designed to increase
local business capacity


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5.4 Development Technology Results: Measuring the Impact

“(W)hat gets measured gets done” - John Browne, 17-Nov-97, New York

In the past 15 years resource companies have made great strides in their ability to measure,
monitor and mitigate their impact on the environment. Companies have accepted that their
activities will impact the natural environment and that there is a responsibility to mitigate any
negative impacts. In order to effectively manage this responsibility it has been necessary to
develop new technologies to enable more effective measurement of environmental impacts.

Resource companies routinely accept that they must file environmental impact assessments that
predict, in minute detail, what impact their extraction operations will have on the surrounding
natural environment. Yet, these same companies are often unable to produce quantitative
estimates of the impact their operations will have on surrounding communities and people. Many
don’t even keep records of local hiring and purchases.

If BP is to successfully meet the challenge of producing energy in ways that enhance the life of
the community as a whole, community impacts must be monitored and measured with the same
focus as environmental impacts. BP and its contractors and agents must be prepared to
quantitatively answer questions dealing with changes to community health, employment,
business, etc. that emanate from resource exploration and extraction. This will mean the
collection of baseline data on communities prior to the onset of activity, much the same way that
baseline data is now collected on the environment. It may well be necessary to develop new
measuring and monitoring technologies.

Targets will have to be set in various community impact areas (health, education, employment,
training, procurement, etc.) and progress towards those targets monitored and evaluated.
Managers and sub-contractors will have to be judged on their community impact as well as along
financial, environmental, safety and other dimensions.

If BP wishes to maximize the impact of its investment in community relations it must develop
and implement a comprehensive program that will set community impact targets and regularly
monitor and reward progress towards those targets.


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6 ISSUES, STRATEGY & RECOMMENDATIONS

6.1 Strategy

Based on the research and analysis carried out, we recommend adoption of the following strategy
to enable BP Venezuela to achieve its objective of developing sustainable and mutually beneficial
relations with the Warao peoples in an efficient and cost effective manner.

To cost effectively and efficiently organize exploration activities so that they
support BP’s social responsibility objectives of contributing to the development
of civil society, environmental responsibility and maximizing the sustainable
benefits received by local interests.

The following recommendations build upon the progressive work already undertaken by BP and
constitute an implementation program for the strategy articulated previously. An implementation
matrix following the recommendations provides summary information on recommendations and
implementation. There is a high degree of inter-connectivity between the various
recommendations and individual tasks are sometimes related to more than one recommendation.
Section 7 outlines a short term work plan that identifies tasks necessary to begin implementation
of the various recommendations.

The recommendations are organized along the Development Technology analytical framework
discussed in the previous section. All recommendations are organized with a specific
recommendation, rationale, implementation strategy and a time frame. The time frame is based
on the following parameters

• Short Term less than 1 year
• Medium Term 1-3 years
• Long Term more than 3 years

Where appropriate, special considerations have been noted for each recommendation.


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6.2 Enhancing the Corporate Ethos

Issue 1: BP requires that all Personnel are able to work effectively in sensitive
Cross Cultural situations

Recommendation Develop and implement an ongoing Cross Cultural Communications
and Sensitivity training program

Rationale Many corporations and their personnel are prone to making broad cultural
generalizations on the basis of their own educational and experiential
background. These generalizations are often made with the best of
intentions, and are the result of a limited scope and understanding of other
cultures and perspectives. Should these generalizations continue unchecked
they can reflect poorly on the company and inhibit its ability to work
effectively across diverse cultural dimensions. Personnel at all levels must
have a basic cross cultural sensitivity in order for companies to work
effectively in diverse cultural settings

Implementation 1. Engage a cross-cultural consultancy firm to assist with the design,
Strategy development and implementation of a comprehensive Cross-Cultural
Training and Sensitization program with the following characteristics:
• The program should be designed in a modular fashion in order to
accommodate the specific requirements of the various users and
permit easy adaptation for other Indigenous peoples in other BP
operations
• It should be designed so that BP personnel can be trained to deliver
it on a regular basis.
• It should be scalable so it is effective for personnel with varying
levels of cross cultural interaction (i.e. someone working in the field
directly with Indigenous peoples will need a different level of
training than someone in corporate finance or someone who is only
going to have short term inter-actions)
• It should have components and materials that can be utilized as part
of regular briefing processes
• There should be a package of materials that is designed to
complement the modular and scaleable program
• It should utilize local Indigenous peoples to enhance the delivery


- 29 -

2. When developed it should be mandatory for all personnel, including
contractors and their staff, to take the appropriate level briefing.

Timeframe 1. Begin program development as soon as possible.
2. When a basic program is developed begin training BP trainers and
delivering the program to appropriate personnel.
3. With feedback from the initial delivery refine and enhance various
modules as appropriate


- 30 -

Issue 2: BP has a considerable internal knowledge base on Indigenous
information, but the information is not coordinated and requires
ongoing enhancement and updating

Recommendation BP should consolidate its existing internal knowledge base on
Indigenous issues and continue expanding and enhancing it.

Rationale A current and comprehensive knowledge base on Indigenous issues and
developments, both in Venezuela and throughout the world, is necessary for
an organization that wants to work effectively with Indigenous peoples.
Indigenous issues are complex and have multiple historic roots. Currently,
BP has a good internal information and knowledge base, but the
information does not permeate the organization and it requires enhancement
in key areas. (the communications strategy [Recommendation 3] will deal
with socializing Indigenous information throughout the organization)

Implementation 1. Identify key persons in each unit dealing directly with Indigenous issues
Strategy and ensure that they are aware of all Indigenous information and that
information is actively shared across units.
2. Continue building and enhancing the knowledge base through regular
interaction with Indigenous peoples and organizations.
3. Develop an online directory that catalogs various documents and reports
on Indigenous peoples and issues and indicates how to access them
4. Encourage regular information sharing with other BP Assets that deal
with Indigenous Peoples
5. Contract a third party to provide regular briefings on international
Indigenous issues and activities, including policies and actions of multi-
lateral and international organizations (this will be much more cost
effective than attempting to remain up to date on these activities
internally and will significantly extend the scope of BP’s information
gathering capacity)
6. Attend pertinent conferences, meetings and other sessions on or relating
to Indigenous issues. The contractor in Item 5 above, can help to
identify appropriate events to attend, and if necessary, could attend
them directly and then brief appropriate BP Personnel. Also, it may be
worthwhile to attend some meetings, such as the UN Working Group on
Indigenous Affairs, with the contractor or someone who has contacts
and experience in these forums.

Time Frame Short term and ongoing


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Issue 3: Knowledge of Indigenous issues and awareness of their importance
does not permeate BP’s operations.

Recommendation Develop and Implement ongoing Communication Strategy to socialize
information on Indigenous issues and developments throughout the
organization.

Rationale In order for BP to operate effectively on Indigenous lands it is imperative
that a basic knowledge of Indigenous issues and their importance permeate
the entire organization, much the same way that basic knowledge of
environmental and safety issues currently does. Additionally, many in the
organization will need additional levels of knowledge and information.

Implementation 1. The success of this initiative will, to a large extent, be dependent upon
Strategy the level of cross cultural awareness within the organization and the
development of a comprehensive knowledge and information base on
Indigenous issues and developments. [see Recommendation 2]
2. Begin the program with a direct message from the President of
BP Venezuela to communicate the importance of Indigenous issues.
3. Work with Warao and other Indigenous peoples where possible to
develop a range of communication materials that will facilitate
information dissemination (use print, video, electronic and other media
as appropriate). Recommendation 4 will suggest the creation of an
Indigenous Decade communications initiative. Obviously these two
should be coordinated. Where possible utilize materials from the cross
cultural training programs.
4. Ensure that approriate Indigenous information is included in all staff
and personnel orientation briefings. [materials to be developed in
Recommendation 1]
5. Utilize the International Day of the World’s Indigenous Peoples,
August 9, to undertake special activities to promote and share
Indigenous information
6. Create other strategies and activities to ensure the permeation of
Indigenous information throughout the organization.
7. Note that item 3 above may represent an opportunity to hire or contract
Indigenous peoples

Time Frame Short to Medium Term and ongoing. As noted, it should follow the cross
cultural training.


BP Venezuela Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

BP Venezuela Indigenous Relations: Meeting the Challenge – Responsibly and Sustainably

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