The Limits of Stakeholder Engagement

Corporate–Indigenous relations now sit at the centre of governance, accountability, and risk considerations for companies operating in Canada. Across sectors, organizations work within Indigenous territories, interact with Indigenous governments, and seek to establish relationships that extend well beyond individual projects or transactions. Yet the conceptual frameworks used to structure these relationships are rarely examined with sufficient care, particularly with respect to how Indigenous Nations are positioned within corporate engagement models.

A common feature of corporate practice is the classification of Indigenous Nations as stakeholders. This approach is typically adopted for administrative clarity and procedural consistency. From a governance and legal perspective, however, it raises substantive concerns. Indigenous Peoples in Canada are not simply affected parties within a broader field of interests. They are rights holders and governing authorities with jurisdictional relationships to land, resources, and decision-making that differ fundamentally from those of other actors commonly included in stakeholder frameworks.

Recognizing this distinction is not a matter of terminology. It shapes how engagement is designed, how authority is understood, and how legitimacy is established in corporate–Indigenous relationships.

Legal and territorial context

Indigenous rights in Canada are constitutionally protected under section 35 of the Constitution Act, 1982. Judicial interpretation has clarified the existence of Aboriginal title, treaty rights, and elements of self-government. These rights are territorially grounded. They are inseparable from land, water, and place.

Corporate engagement therefore does not occur in an abstract social environment. It takes place on specific Indigenous territories, each with its own legal history, governance structures, and decision-making protocols. Whether a territory is subject to treaty, covered by land claims, or subject to assertions of Aboriginal title has material implications for how Indigenous governments understand their authority and responsibilities.

Engagement frameworks that treat Indigenous Nations as interchangeable stakeholders often overlook this territorial specificity. As a result, engagement approaches are standardized across regions even when the underlying legal and political contexts differ substantially. Over time, this disconnect shapes expectations on both sides and contributes to misunderstandings about authority, accountability, and decision-making.

The limits of stakeholder-based engagement

Stakeholder frameworks are designed to manage a range of interests by identifying affected parties and gathering input. In many regulatory and corporate contexts, this approach offers procedural clarity and internal consistency. Its underlying assumptions, however, are poorly aligned with relationships grounded in jurisdiction and governance.

Classifying Indigenous Nations as stakeholders frames engagement as advisory rather than governmental. Consultation is positioned as a mechanism to inform corporate decision-making, rather than as part of an interaction between governing authorities operating within a shared territorial context. This framing may appear workable at early stages, when engagement remains exploratory. As projects advance and decisions carry greater consequence, differences in assumptions about authority and legitimacy tend to surface.

At that point, engagement processes built around stakeholder input often struggle to accommodate Indigenous governance expectations, particularly where decisions are perceived to affect lands, resources, or long-term community interests.

Operational consequences

How Indigenous Nations are classified within corporate systems has practical consequences for how engagement is carried out. Standardized engagement models frequently prioritize internal efficiency, predictable timelines, and consistency across jurisdictions. Indigenous governance processes, by contrast, are shaped by collective decision-making, accountability to citizens, and protocols grounded in law and tradition.

Misalignment commonly appears in engagement timelines that do not reflect Indigenous decision-making processes, in the delegation of engagement responsibilities to teams without authority to adapt decisions, and in internal escalation structures that are disconnected from Indigenous governance realities.

Language reinforces these dynamics. Terms such as “community consultation” or “local stakeholder engagement” can signal assumptions about authority and influence how Indigenous governments interpret corporate intent. Over time, these signals shape organizational behaviour, often narrowing the space in which Indigenous voices meaningfully inform substantive decisions.

Implications for corporate practice

Reconsidering how Indigenous Nations are positioned within corporate engagement frameworks carries clear implications for practice. Rather than relying on generalized stakeholder models, organizations benefit from approaches grounded in territorial awareness and governance literacy. Several actions support this shift:

• Identify whose territory you are operating on.

  Companies should be explicit about the Indigenous territories connected to their operations and understand the associated legal and governance context, including treaties, land claims, or assertions of title.

  
  

• Engage Indigenous governments as governing authorities.

  Engagement approaches should reflect where decision-making authority resides and how Indigenous governments exercise that authority.

  
  

• Situate Indigenous relations within corporate governance.

  Responsibility for Indigenous engagement should be visible at the executive and board level, rather than treated as a technical or project-level function.

  
  

• Review internal language and frameworks.

  Policies, ESG disclosures, and risk frameworks should be assessed for assumptions that reinforce stakeholder framing and revised to reflect rights- and territory-based engagement.

  
  

• Design engagement to support Indigenous voice.

  Engagement processes should create space for Indigenous priorities and governance processes to shape decisions, rather than fitting Indigenous input into predetermined corporate structures.

  
  

Concluding observations

Corporate–Indigenous relations are shaped long before engagement begins, through the frameworks organizations use to understand authority, territory, and responsibility. Classifying Indigenous Nations as stakeholders reflects an approach that is often misaligned with the legal and governance realities of operating on Indigenous lands.

Approaching Indigenous Nations as governments with rights and title does not resolve all challenges inherent in corporate activity on Indigenous territories. It does, however, provide a more accurate and durable foundation for engagement that places Indigenous voices at the centre of decision-making and relationship-building.

For organizations seeking to change how corporate–Indigenous relations are practiced, attention to these foundational governance questions remains an essential point of departure.