1a. The first phase of taxonomy development will focus on climate mitigation. In subsequent phases of the Canadian taxonomy, which objectives should be prioritized? Please select your top choices.

• Protection of biodiversity and healthy ecosystems
• Water and marine resource conservation

2a. Do you agree or disagree with these proposed principles as the foundation for the taxonomy?

Agree

2b. Please share the reason for your answer in the space provided

Credibility Principle:
While all of the principles are important, credibility is the most important. To that end, UBCIC supports the principles set out in credibletaxonomy.ca.
In particular, a credible taxonomy cannot include oil and gas. To preserve the taxonomy's integrity, credibility, and usefulness as a trusted investment classification system, the taxonomy should not classify oil and gas activities as environmentally sustainable because doing so would undermine the taxonomy's core purpose of directing capital toward activities that are genuinely aligned with long-term environmental objectives, scientifically credible pathways to net-zero emissions, and respect for Indigenous rights–all of which are fundamental components of sustainability. Including oil and gas increases the risk of green-washing, weakens investor confidence, creates inconsistent market signals, and may lock in/extend reliance on high-emitting activities for decades while perpetuating projects that often adversely affect climate stability, ecological integrity, the health of Indigenous lands, territories, resources, and the exercise of Indigenous rights.

Further, a credible taxonomy must uphold human rights and Indigenous rights. The UN Declaration on the Rights of Indigenous Peoples (UN Declaration) is a minimum standard and should be incorporated in the Minimum Social Safeguard (MSS). This is discussed further below.

Regionally Specific Principle:
Regarding the “Regionally Specific” principle, while UBCIC appreciates the intent of this principle to ensure the taxonomy is responsive, flexible and inclusive with regard to varying economic and technical realities across Canada (including in northern, rural, remote and Indigenous communities), it is essential that any differentiated pathways or alternative technical screening criteria do not inadvertently create lower substantive standards for taxonomy-alignment resulting in or exacerbating violations to Indigenous rights. Flexibility in how environmental criteria are achieved must not translate into weaker environmental sustainability performance requirements, lower technical screening assessments, or reduced MSS criteria, including respect for Indigenous rights.

In particular, the ability of a taxonomy user to demonstrate economic or technical constraints on a project or activity should never justify a reduced threshold for respecting Indigenous rights or enable projects that fail to uphold those rights to nonetheless qualify as taxonomy-aligned. Any alternative pathways must remain fully subject to the taxonomy's MSS criteria—as recommended below, including requirements relating to Indigenous rights, self-determination, and the Free, Prior and Informed Consent (FPIC) standard where applicable.

Further, while the “regionally specific” principle recognizes that certain low-carbon technologies may not yet be economically or technically viable in some regions, any regionally differentiated pathways established by the taxonomy should support these communities in achieving viability and the taxonomy’s environmental and climate objectives—not provide high-emitting industries with exceptions or a lower threshold for taxonomy eligibility at the expense of communities, or perpetuate communities’ dependence on such industries.

Lastly, UBCIC is concerned that the “Regionally Specific” principle, if not carefully designed with robust safeguards, could unintentionally reinforce existing patterns of environmental racism and injustice. Northern, rural, remote, and Indigenous communities have historically and continue to bear disproportionate environmental, health, cultural, and economic harms from extractive industries while receiving fewer benefits. The taxonomy should not reinforce these inequities by creating pathways that make it possible for fossil fuel activities—or easier for other high-emitting projects in these regions—to receive a taxonomy-aligned designation. Doing so would risk directing additional capital toward activities that perpetuate the concentration of environmental harms and Indigenous rights violations in communities that have already experienced disproportionate impacts from industrial development. Accordingly, fossil fuel projects and activities should be entirely excluded by the taxonomy, and any “regionally specific” alternative pathways must continue to satisfy rigorous technical screening criteria demonstrating that an activity is genuinely environmentally sustainable, meets MSS criteria (as recommended below), and warrants taxonomy-aligned status.

3. Please rate each of the principles below on a scale from “very important” to “not at all important.”

Credible

Very important

Usable

Important

Interoperable

Important

Dynamic

Important

Regionally Specific

Important

Prioritized

Important

4a. Do you agree or disagree with the proposed partial alignment approach, which would require entities to disclose the extent to which DNSH/MSS criteria are or are not met rather than requiring full alignment with all DNSH/MSS criteria?

Disagree

4b. Please explain your answer in the space below

UBCIC disagrees with the proposed partial alignment approach, centred solely on disclosure requirements, and instead supports requiring full alignment/compliance with MSS and DNSH criteria (referred to as the “binary approach” in the taxonomy report), with the UN Declaration’s standards, rights, and principles (i.e., FPIC) incorporated into these criteria as a minimum standard. This is why we refer to this approach as Full UNDRIP Alignment.

As such, taxonomy-users must demonstrate full adherence to Indigenous rights as set out in the UN Declaration (Full UNDRIP Alignment) in order to meet the threshold required to qualify for any taxonomy designations. This, of course, presumes adherence to the constitutionally recognized and affirmed Aboriginal and treaty rights protected under s. 35(1) of the Constitution Act, 1982.

UBCIC maintains that the UN Declaration—including the right to FPIC—establishes a minimum standard for respecting Indigenous Peoples’ rights; it is the floor, not the ceiling.

As it stands, the MSS criteria are the only component of the taxonomy that provides any direct accountability for Indigenous rights with reference to the UN Declaration.

However, by failing to require entities, projects or activities to demonstrate evidence of Full UNDRIP Alignment to the UN Declaration, and instead merely allowing users to disclose the extent to which those criteria have or have not been met, the taxonomy risks treating these safeguards as voluntary and aspirational rather than foundational and threshold requirements.

Under the proposed partial alignment approach, a taxonomy user could disclose that they do not currently—and do not intend or commit to—meet any UN Declaration standards, yet still receive a taxonomy designation if they meet the current Green or Transition criteria. Such an entity could receive taxonomy-aligned status—and benefit from increased access to capital and market legitimacy—despite failing to adhere to Indigenous rights, including through violations of the principles reflected in the UN Declaration, such as FPIC and Indigenous Peoples’ rights to self-determination, land, territories, and resources.

Accordingly, such an approach undermines the purpose of the MSS framework: to ensure that activities deemed “sustainable” do not cause or contribute to violations of fundamental Indigenous rights.

Without full alignment with the UN Declaration, to be reflected by MSS criteria, such activities cannot be said to be truly “sustainable” by any means, and should not be endorsed or incentivized through Canada’s sustainable finance taxonomy.

While the taxonomy is a voluntary framework and is not itself a law subject to the alignment requirements of Canada’s United Nations Declaration on the Rights of Indigenous Peoples Act (UNDRIP Act), it should nonetheless be developed and implemented in the spirit of Canada’s commitments to advancing reconciliation and aligning Canadian approaches with the principles affirmed in the UN Declaration. This is particularly important given the constitutional protection afforded to Indigenous rights in Canada and the role of sustainable finance frameworks in shaping capital allocation and market expectations.

To avoid becoming a mechanism that inadvertently channels capital toward activities associated with Indigenous rights violations, the taxonomy must make Full UNDRIP Alignment a required condition of taxonomy-alignment, rather than a secondary disclosure-based consideration.

Accordingly, failure to meet Full UNDRIP Alignment should preclude an activity from receiving a sustainable taxonomy designation. Otherwise, taxonomy alignment risks becoming a mechanism that legitimizes, incentivizes, or directs capital toward activities that bypass or proceed in violation of Indigenous rights, undermining the very sustainability objectives the taxonomy is intended to advance.

The taxonomy’s proposed partial alignment approach—which would require entities to disclose the extent to which they do or do not meet DNSH and MSS criteria—may appear to promote greater transparency by establishing a baseline expectation for users to disclose their performance against MSS criteria (including Indigenous rights). However, this approach risks being ineffective without meaningful incentives for adherence or consequences for non-compliance. Research has demonstrated that voluntary self-assessment and disclosure mechanisms, in the absence of accountability measures, often fail to drive meaningful changes in corporate behaviour (see source list pasted below). Without stronger requirements to meet MSS criteria, partial alignment risks sending the message that respect for Indigenous rights is aspirational rather than a minimum standard, while leaving the burden of addressing rights violations to Indigenous communities who already bear the disproportionate impacts of these failures.

UBCIC is concerned that there is a broader trend in corporate self-assessment, including in material securities disclosure and voluntary reporting (such as in Reconciliation Action Plans), of companies omitting, minimizing, or misrepresenting their impacts on Indigenous rights and the resulting legal, financial, operational, political and reputational risks. See Living in a Material World: Turning Corporate Indigenous Relations Communications from Token to Tangible.

Unless clear and mandatory criteria are established in order for users to be able to claim-taxonomy alignment, we anticipate that similar shortcomings will arise in the context of the taxonomy.

Lastly, as highlighted in Living in a Material World, there are numerous case studies demonstrating significant gaps between corporate self-disclosure and actual respect for Indigenous rights in practice. These examples illustrate why a partial alignment approach based solely on user self-disclosure would be insufficient, and why the MSS framework should go beyond Australia's model by incorporating clear verification criteria and accountability mechanisms as a requirement before a user can obtain taxonomy-alignment status or labelling.

The experience of Rio Tinto provides a compelling example, from the Australian context. Despite receiving the highest level of Reconciliation Action Plan (RAP) accreditation ("Elevate") based on its stated commitments and disclosures, Rio Tinto proceeded with the destruction of the Juukan Gorge caves in the face of strong opposition from the Puutu Kunti Kurrama and Pinikura (PKKP) people. Following the incident, Reconciliation Australia revoked Rio Tinto's Elevate RAP status. This demonstrates the serious shortcomings of relying on issuer self-disclosure or policy commitments alone to determine whether an entity is meaningfully aligned with Indigenous rights—and deserving of a RAP designation—or in this case, taxonomy-alignment.

For instance, under a partial alignment approach, a company could inaccurately or misleadingly represent that it respects Indigenous rights and, if it otherwise meets the current technical criteria for the "green" category, receive that taxonomy designation. Without any mechanism for independent verification or for Indigenous Nations to challenge those claims, the company could continue to benefit from a "green" taxonomy label even where the project is proceeding in violation of Indigenous rights or despite sustained opposition from affected Indigenous Nations. This risks conferring a sustainability designation on activities that are fundamentally incompatible with the MSS framework's stated commitment to Indigenous rights.

For this reason, UBCIC strongly supports the establishment of clear baseline criteria and verification requirements to ensure that a taxonomy user is fully aligned with Indigenous rights (as set out in the UN Declaration) in practice before receiving any taxonomy-aligned designation. This should include both (1) requiring taxonomy users to provide objective and credible evidence of full alignment with the UN Declaration—such as evidence that they have obtained Free, Prior and Informed Consent (FPIC) (measured by clear indicators; see UBCIC submission to Question 10)—and; (2) establishing an accessible grievance mechanism through which Indigenous Nations can oppose inaccurate or misleading claims of Full UNDRIP Alignment, to be resolved before a taxonomy-user can receive taxonomy-aligned designations. Together, these measures should serve as a threshold requirement for any taxonomy-aligned designation. Only projects or entities that have demonstrated full alignment with Indigenous rights (as set out in the UN Declaration) should be eligible to be labelled as "green" or "transition" activities.

Source List:
– Living in a Material World: Turning Corporate Indigenous Relations Communications from Token to Tangible. https://assets.nationbuilder.com/ubcic/pages/10755/attachments/original/1781823104/RAPS_Living_in_a_Material_World.pdf?1781823104;
– Roebuck, K., Alonso, G. (2025). Voluntary corporate accountability doesn’t work. Canada needs to mandate it. Policy Options. https://policyoptions.irpp.org/2025/10/corporate-accountability-mandate/;
– Braam, G. J. M., Uit de Weerd, L., Hauck, M., Huijbregts, M. A. J. (2016). Determinants of corporate environmental reporting: The importance of environmental performance and assurance. Journal of Cleaner Production, 129, 724–734. https://www.sciencedirect.com/science/article/pii/S0959652616301068;
– Wong, C. W. Y., Wong, C. Y., Boon-itt, S., Tang, A. K. Y. (2021). Strategies for building environmental transparency and accountability. Sustainability, 13(16), 9116. https://doi.org/10.3390/su13169116.

5a. Do you agree or disagree with the proposed scope of objectives to be covered under the DNSH and MSS frameworks?

Agree

5b. Please explain your answer in the space below

We support the proposal to include Indigenous rights within the MSS framework. Given the potential for economic activities to impact Indigenous Peoples, including impacts on Aboriginal and treaty rights, Aboriginal title, lands, waters, cultures, and self-determination, any credible sustainable finance framework must recognize and address Indigenous rights as a core component of sustainability. This is also consistent with Canada’s legal framework, including the constitutional recognition and affirmation of Aboriginal and treaty rights, as well as Canada’s commitments to implement the UN Declaration.

We also agree that further input and engagement are needed to determine how Indigenous rights are integrated into the Canadian MSS criteria. We add that any such development must meaningfully involve Indigenous rights-holders and representative institutions, in accordance with the principle of “nothing about us without us.”

Finally, as discussed above, including Indigenous rights within the scope of MSS is most effective in the Full UNDRIP Alignment approach, as the partial alignment approach could result in watering down these minimum standards.

6a. Do you agree or disagree with the proposed approach to grounding the DNSH/MSS frameworks in Canadian legislation and going beyond existing laws and standards where necessary?

Strongly agree

6b. Please explain your answer in the space below

Complying with legal minimums should not require a taxonomy. By definition, meeting legal requirements should be seen as a minimum barrier for accessing any financial support.

The UNDRIP Act (federal) and DRIPA (British Columbia) establish legislative frameworks for ‘aligning’ federal and provincial laws with the UN Declaration. These statutes acknowledge that existing laws and standards in these jurisdictions do not, in many cases, yet fully reflect the standards set out in the UN Declaration, and they establish a continuing commitment and responsibility to advance alignment with those standards at both the federal and British Columbia levels. This provides important context for the development of a National Sustainable Finance Taxonomy in Canada.

The MSS criteria are intended to establish a baseline for ensuring that taxonomy-aligned activities adhere to appropriate governance, legal, and ethical standards. UBCIC maintains that the UN Declaration represents a minimum standard and that demonstrating adherence to the UN Declaration principles should be understood as part of that baseline.

Accordingly, for the MSS framework to meaningfully uphold Indigenous rights, it must go beyond existing national laws and standards where they currently fall short of meeting the minimum protections and principles affirmed in the UN Declaration. Accordingly, UBCIC supports the proposed approach of grounding the MSS framework in Canadian legislation, including the Constitution Act, 1982, the UNDRIP Act, and DRIPA and going beyond them where necessary to align with the UN Declaration.

Going beyond existing laws does not appear to be controversial in other areas of the taxonomy. For example, the ASEAN taxonomy cited at p.49 of the methodology report discusses using advanced certification such as LEED for new buildings, rather than requiring compliance with the relevant building code.

7. In which areas, if any, is it necessary to go beyond existing laws and standards for the DNSH/MSS framework?

As reiterated by UBCIC throughout this submission, the standard set out in the UN Declaration is the minimum standard and is appropriate as a MSS benchmark. Therefore, it is necessary to go beyond existing laws and standards in order to ensure the DNSH/MSS framework meaningfully meets the baseline standard set by the UN Declaration.

Existing standards, such as IFC Performance Standard 7, require consent in certain circumstances – which is arguably beyond the current state of Canadian law. However, IFC PS7 does not meet the minimum standard set out in the UNDRIP, and neither do the Equator Principles. This is one area where UBCIC finds it necessary to go beyond existing laws and standards in order to meaningfully meet FPIC standards as set out in the UN Declaration.

Further, the Methodology Report proposes that the MSS and DNSH assessments happen after the classification of the activity, similar to other jurisdictions. This re-enforces the notion that MSS and DNSH are secondary and distinct from the climate considerations in the classification framework, which UBCIC rejects. A project that reduces emissions but violates Indigenous rights undermines the credibility of the whole taxonomy. Accordingly, this is another area where UBCIC considers it necessary to go beyond existing standards in other jurisdictions.

8a. Do you agree or disagree that different DNSH/MSS standards should apply to projects or entities of different sizes? E.g. more comprehensive disclosures required for larger projects and/or entities, with more streamlined disclosures for smaller projects and/or entities?

Disagree

8b. Please explain your answer in the space below

UBCIC disagrees that different MSS (Indigenous rights) standards should apply to projects or entities based solely on their size. Instead, the MSS criteria should establish a consistent minimum standard (determined by the UN Declaration) applicable to all taxonomy users, regardless of project or entity size or type. A smaller project should not receive taxonomy-aligned status where it fails to respect Indigenous rights, just as a larger project should not be permitted to claim alignment without meeting these fundamental requirements.

For any entity, project, or activity that impacts Indigenous rights, the obligation to meet UN Declaration requirements (i.e., FPIC) is the same minimum standard across the board; however, additional or more comprehensive and substantive MSS requirements may be imposed where the impact on Indigenous rights is greater.

Therefore, as UBCIC recognizes that proportionality may be appropriate in determining the scope, format, or administrative burden of MSS substantive and disclosure requirements depending on the taxonomy user, this principle should be less focused on the size of a project or entity and instead depend on the degree and extent an activity, entity or sector can impact Indigenous rights.

Having MSS criteria based on the degree of impact would mean that regardless of whether an activity is high- or low-impact from an ecological, environmental, or climate perspective, if it impacts Indigenous rights, it must meet the UN Declaration’s minimum standards. In other words, an activity that impacts Indigenous rights does not have a lower standard of consent simply because it is low-emissions; it must obtain FPIC in accordance with the UN Declaration as the minimum standard. However, where the degree of impact on Indigenous rights is greater, additional and more substantive requirements may apply in addition to/beyond obtaining FPIC.

There are established tests in Canadian law that set out differential treatment and requirements based on an analysis of the degree of impact of activities on Aboriginal rights (see Haida Nation v. British Columbia (Minister of Forests), 2004 SCC 73, [[2004] 3 S.C.R. 511). This framework provides a useful conceptual example, but must be expanded to the context of Indigenous rights as recognized by the UN Declaration, including the baseline FPIC standard [see UBCIC’s submissions to Question 6a for the need to go beyond legal minimums].

Accordingly, all activities that impact Indigenous rights must meet MSS requirements indicating full alignment with the UN Declaration. Beyond that, activities with a greater potential to affect Indigenous territories, resources, self-determination, or other rights may warrant more comprehensive requirements under the taxonomy. For example, industries with a direct potential to impact Indigenous territories, rights, and interests may warrant more comprehensive substantive, disclosure and assessment requirements than industries whose activities are less likely to engage or impact those rights.

The bottom line is, any alternative requirements for projects or entities should not result in different baseline substantive expectations for respecting Indigenous rights. Regardless of the type or size of an entity or project, all users seeking taxonomy-alignment must meet the same underlying baseline obligations to respect Indigenous rights (as affirmed by the UN Declaration) which the MSS criteria should reflect.

This is because Indigenous rights, as set out in the UN Declaration and including the right to self-determination and the right to FPIC, do not vary based on the size of the entity or project—this should not be any different in the context of users seeking taxonomy-alignment. All actors whose activities may impact Indigenous Peoples and their rights have a clear baseline responsibility to respect those rights as they apply, although disclosure requirements can be more stringent for activities or entities that have a greater impact on those rights. In other words, the scale of a project may affect the nature or extent of potential impacts, but it does not diminish the obligation to prevent rights violations to affected Indigenous rights-holders.

UBCIC recognizes that smaller entities may face different capacity, resource, or reporting challenges and supports approaches that provide appropriate guidance, support, and flexibility in how Full UNDRIP Alignment is demonstrated. However, ultimately, differentiated disclosure pathways must not create a lower standard that enables smaller projects or entities to bypass baseline MSS criteria or claim taxonomy-alignment despite failing to meet the minimum requirements established by the UN Declaration.

Lastly, at all times, Indigenous Peoples must also have a meaningful and accessible avenue to identify, challenge/oppose, and seek review where a company’s assessment incorrectly concludes that its activities do not impact Indigenous rights or that MSS criteria have been satisfied when they have not.

9. Are there any gaps in the proposed DNSH/MSS framework that could result in unintended environmental or social harms?

Fundamental Concerns with Relegating Indigenous Rights Solely to the MSS Framework and Separating Them from the Taxonomy’s Environmental Sustainability Criteria:

A credible sustainability taxonomy must recognize Indigenous rights and knowledge systems not as a secondary MSS consideration assessed after sustainability designations are determined, but as fundamental to understanding and determining what constitutes environmental sustainability in the first place.

A taxonomy that designates activities as “environmentally sustainable” or “green” while failing to account for impact on Indigenous rights, territories and conceptions of sustainability as part of its defining criteria is not meaningfully sustainable and risks directing capital toward projects that undermine and interfere with Indigenous Peoples’ rights, relationships with their territories, and ongoing efforts to exercise and maintain Indigenous and Aboriginal rights and Title across generations.

Indigenous Peoples’ conceptions of sustainability are often connected to their inherent rights to, relationships with and stewardship over their territories which have existed since time immemorial and are expressed through diverse legal orders, governance systems, knowledge systems and cultural practices. These systems often recognize that territorial integrity, responsibilities to future generations, and the exercise of Indigenous rights are inseparable. As reflected in countless cases of Indigenous Peoples’ opposition to environmentally unsustainable economic activities, Indigenous rights and environmental sustainability can often be deeply interconnected. A definition of “environmental sustainability” that fails to account for this is incomplete and risks imposing a narrow, colonial conception of sustainability.

Additionally, Crown conceptions of Aboriginal Title contain elements related to “environmental sustainability”. Aboriginal Title, as recognized and affirmed by s. 35 of the Constitution Act, 1982, and as recognized by the Supreme Court of Canada, is not simply a right to occupy land, but reflects a collective right and ongoing relationship between Indigenous Peoples and their territories across generations. Aboriginal Title is a constitutionally protected right that is held collectively by each Indigenous rights-holder for present and future generations. This means it cannot be encumbered in ways that would prevent future generations of the group from enjoying it [Tsilhqot'in Nation v. British Columbia, [2014] 2 SCR 7, 2014 SCC 44]. Further, lands held pursuant to Aboriginal title cannot be used in a manner that is irreconcilable with the nature of the attachment to the land which forms the basis of the particular group's Aboriginal Title [Delgamuukw v. British Columbia, [1997] 3 SCR 1010]. It is subject to this inherent limit that Aboriginal Title holders have the right to use their lands for modern purposes, including economic development, and not just traditional activities [Tsilhqotin]. In these ways, and to remain credible, the taxonomy cannot exclude Indigenous rights (including Aboriginal Title) from criteria defining “environmental sustainability”.

To put this into perspective, only approximately 5% of British Columbia is covered by historic or modern treaties, leaving the vast majority of the province as unceded Indigenous territories subject to ongoing Aboriginal Title assertions, litigation, negotiations, and reconciliation processes.

Similarly, the exercise of Aboriginal rights—including rights to hunt, fish, harvest, and maintain diverse territorial-based cultural and spiritual practices—often depends directly on the continued ecological integrity and health of lands, waters, and ecosystems.

Accordingly, activities that encumber lands in a manner that would interfere with the continuity of Indigenous Peoples’ relationships with their territories, compromise the ecological integrity of those lands, or prevent future generations from meaningfully exercising their constitutionally protected Aboriginal rights are fundamentally inconsistent with the objectives of a credible sustainable finance taxonomy and the UN Declaration.

Simultaneously, activities that violate Indigenous rights (as recognized by the UN Declaration), undermine Indigenous self-determination and decision-making authority, or proceed without meaningful consent, may also often be indicators of broader environmental, ecological and climate non-sustainability.

Accordingly, respect for Indigenous rights should not be treated as a separate, optional or supplementary social consideration within the taxonomy; rather, it is often intrinsically connected to whether an activity satisfies the fundamental environmental and sustainability objectives that the taxonomy seeks to advance.
The Report contemplates running the MSS/DNSH screen after running through the activity classification. This sequence has the effect of literally placing social impacts behind activity classification – especially in the partial alignment model proposed in the report. In addition to reinforcing Western notions of sustainability and diminishing Indigenous rights, as discussed above, there may be efficiency losses if the classification process is ultimately thwarted by significant Indigenous rights violations.

If the Taxonomy were to uphold Indigenous rights, consistent with the principles set out in (credibletaxonomy.ca), then it could put a MSS screen prior to the classification, where a failure to achieve MSS would halt or pause the categorization until those minimum standards are met or addressed.

Notably, major financial institutions, such as the Royal Bank of Canada, use an Indigenous rights screening threshold question when considering a commercial loan. Failure to meet that threshold results in enhanced due diligence and risk assessment [https://www.rbccm.com/assets/rbccm/docs/uploads/2026/RBC-2025-sustainability-report.pdf; https://investments.bcgeu.ca/investor_engagement_yields_major_changes_to_indigenous_rights_at_canada_s_largest_bank].

Insofar as Indigenous rights are recognized in the taxonomy (including the MSS criteria), Full UNDRIP Alignment with those rights (as suggested in UBCIC’s submissions to Question 10) must be mandatory, assessed early and central to a taxonomy user’s ability to obtain any taxonomy designations (i.e. green, transition etc.), not as a secondary disclosure requirement. In general, the taxonomy should reconsider the ways it relegates Indigenous Rights solely to the MSS framework, separating them from the taxonomy’s main environmental sustainability criteria and category labelling (ie. green, transition etc.).

10. How should the taxonomy operationalize the principles of the UN Declaration on the Rights of Indigenous Peoples and, in particular, the principle of Free, Prior, and Informed Consent, in the MSS framework?

As reiterated throughout these submissions, UBCIC maintains that the UN Declaration sets a minimum standard for Indigenous rights. One meaningful way to operationalize the UN Declaration’s principles (including FPIC), is to require substantive adherence to Indigenous rights as a threshold condition of receiving a taxonomy-aligned designation.

As a starting point, this could be achieved by requiring taxonomy-users to demonstrate adherence to the baseline standard (Full UNDRIP Alignment), before they can be granted “Green” or “Transition” labels under the taxonomy.

Accordingly, in order for an entity, project, or activity to qualify for a “Green” designation under the taxonomy, they must demonstrate full alignment with the UN Declaration. If an entity, project or activity has unresolved Indigenous rights violations, active Indigenous opposition, or an Indigenous challenge under the taxonomy grievance mechanism to a taxonomy user’s claim of Full UNDRIP Alignment, they cannot receive taxonomy-aligned status or any designations (i.e., Green, Transition etc.) until the Indigenous rights violation or opposition is resolved and, where applicable, confirmed as resolved by the impacted rights-holder.

Note that taxonomy users may self-disclose whether they fulfill this requirement for Full UNDRIP Alignment, subject to a taxonomy grievance mechanism through which Indigenous Peoples can challenge any inaccurate claims or raise ongoing rights violations. Any such challenges or violations must be resolved before a taxonomy designation (e.g., Green or Transition) is granted. See UBCIC’s submission to Question 11 for further detail on the proposed grievance mechanism. [NB: This self-disclosure approach differs from the partial alignment approach in the current taxonomy report. It sets a higher bar for taxonomy-user conduct than simply requiring disclosure of the extent to which MSS criteria are met. Instead, taxonomy users must demonstrate evidence of substantive alignment with Indigenous rights as set out in the UN Declaration as a threshold for receiving a taxonomy-aligned status or designation (e.g., Green or Transition).

Lastly, in addition to not receiving taxonomy-aligned status or designations, UBCIC highly recommends that any non-UNDRIP Aligned entities, activities or projects receive a clear warning label from the taxonomy, reflecting the heightened material risk profile associated the failure to adhere to UN Declaration standards, including FPIC. For more on how financial, legal, operational, reputational, and political risks increase with violations of Indigenous rights, including FPIC, see Living in a Material World: Turning Corporate Indigenous Relations Communications from Token to Tangible.

Operationalizing Particular UN Declaration Principles (Including FPIC):
The taxonomy cannot meaningfully operationalize the UN Declaration if an economic activity, entity, or project can qualify as environmentally sustainable (i.e., receive a “Green” or “Transition” designation) without demonstrating meaningful and full alignment with the UN Declaration, as a minimum baseline.

If the taxonomy mobilizes the allocation of capital toward activities designated as “environmentally sustainable” without including, within its MSS framework, specific and mandatory criteria grounded in the UN Declaration principles to assess and ensure that activities violating Indigenous rights (e.g., activities that negatively impact Aboriginal rights and title, proceed without FPIC, undermine Indigenous Peoples’ right to self-determination etc.) cannot receive taxonomy-aligned status, it risks directing capital toward projects that are environmentally sustainable in name only, while facilitating or incentivizing violations of Indigenous rights that are often not separate from environmental sustainability, but can often serve as indicators that a project is fundamentally incompatible with long-term ecological and social sustainability. In doing so, the taxonomy could inadvertently channel investment toward activities that cause, perpetuate, or exacerbate significant environmental and Indigenous rights harms.

If a sustainable finance taxonomy is intended to identify activities that are genuinely "sustainable," then its MSS Criteria should not merely require users to disclose the extent to which Indigenous rights have been considered—they should establish related conditions/criteria that must be met before an activity can qualify or be eligible for any “environmentally sustainable” taxonomy designations. Accordingly, operationalizing UNDRIP principles—including FPIC—within the MSS framework (i.e., through identifying and setting out clear criteria required to fulfill Full UNDRIP Alignment) is essential to ensuring the credibility and integrity of Canada’s sustainable finance taxonomy.

To meaningfully operationalize FPIC in particular, UBCIC recommends requiring taxonomy users to provide evidence of the following criteria/indicators to demonstrate either that they are fully aligned with the UN Declaration:
o evidence that the user recognizes the process, content and form of FPIC may vary between Indigenous Peoples and will highly depend on a rights-holder’s unique system of governance and legal order and adapts the following requirements to align with that as needed
o evidence of correct identification of all affected/impacted Indigenous Peoples (recognizing that appropriate rights-holders will vary depending on the impacted Indigenous Peoples’ systems of governance and legal orders (This includes recognizing that the appropriate rights-holders may be Indian Act band councils, hereditary or traditional leadership structures, or other Indigenous governance bodies, depending on the specific context).
o evidence that all necessary and relevant information was provided to the affected Indigenous Peoples in culturally appropriate and accessible formats (at the earliest possible planning stage)
o evidence that sufficient time was given for community deliberation / decision-making processes
o evidence that decisions made through Indigenous Peoples' own representative institutions
o evidence that the community provided free/voluntary consent where required under the UN Declaration (not just domestic law)
o evidence that consent was given prior to the proponent finalizing plans for carrying out activities (early on – were Indigenous governments involved at the earliest planning stage?)
o documentation that consent can be withdrawn or renegotiated if project circumstances materially change (requirement to maintain consent, not just obtain it once)
o requiring rights-holder verification and a meaningful and accessible avenue to identify, challenge, and seek review where a company’s assessment incorrectly concludes that they have obtained (and maintained) FPIC) not just relying on company self-reporting/disclosure
o NB. There is existing Indigenous-led guidance on what FPIC-related disclosure criteria should be established in the context of mining as an industry with direct Indigenous rights impacts, such as the First Nations Financial Management Board’s criteria for NI-43-101: (1) The traditional and colonial (settler) names of the Indigenous Peoples on whose lands the project is located; (2) A map depicting the territories; (3) A description of how the project impacts Indigenous rights; (4) Whether any agreements are in negotiation or have been reached; (5) Whether free, prior and informed consent has been provided for the project, and, if not, the reasons why and the issuer’s plan to obtain consent; (6) Any notice provided to the impacted First Nation(s); (7) The status of any consultation, including accommodation where necessary; (8) Whether the issuer has received notification from the Indigenous rightsholders withholding consent for the project. Source: First Nations Financial Management Board, Re: CSA Consultation Paper 43-101, Consultation on National Instrument 43-101, Standards of Disclosure for Mineral Projects (12 September 2022) [letter] (“FNFMB letter”).

The following are additional Red Flag Exclusions indicating potential infringement of Indigenous rights (not an exhaustive list). These indicators are examples of circumstances that would warrant the automatic disqualification of an entity, activity, or project from receiving any taxonomy designation. For example, an activity is ineligible where a taxonomy user does the following, or where an Indigenous rights-holder flags the following through the taxonomy grievance mechanism (see further discussion under 11(a)):
• proceeds without FPIC where FPIC is required under UNDRIP
• infringes Aboriginal or treaty rights (as recognized under UNDRIP + s. 35/common law)
• proceeds over unresolved Indigenous objections
• is subject to ongoing Indigenous rights litigation or regulatory process alleging serious violations
• ignores Indigenous legal orders or governance processes
• has resulted in findings of human rights violations by courts or human rights bodies
• creates cumulative impacts on Aboriginal rights (taxonomy criteria need to recognize the cumulative impacts of activities on Indigenous rights, where individual projects may appear sustainable, but collectively, they undermine Aboriginal and treaty rights. So assessing this somehow before granting/refusing to grant a designation would be ideal (ie. cumulative impacts on traditional territories, Aboriginal title claims, exercise of Aboriginal/treaty rights, cultural practices, food security, Indigenous economies etc.).

Due Diligence:
The approach proposed above puts the onus on the company to establish UN Declaration alignment by providing evidence of i.e., obtaining and maintaining FPIC on an ongoing basis, while providing opportunities for impacted Nations to provide feedback or grievances.

There are many resources to enhance due diligence processes, including: https://www.tallgrassinstitute.org/fpic.

The Tallgrass Insititute’s Due Diligence Questionnaire includes five steps:
1. Review Existing policy commitments — audit the company's human rights and Indigenous-specific policies against UNDRIP, ILO Convention 169, UNGPs, and sector standards (IRMA, Equator Principles).
2. Identify impacted Indigenous Peoples — including "potentially impacted" communities whose territorial, hunting, fishing, or ancestral ties extend beyond officially demarcated boundaries. Who are the rights holders according to the Indigenous Peoples’ legal traditions?
3. Collect relevant data — ie. host-country legal regime, participatory mapping with impacted community (inside and outside official boundaries), Indigenous governance structures (formal and informal), Indigenous legal processes, community development plans, and environmental/social impact assessments.
4. Engagement and agreement — protocol-driven engagement with proper rights holders, translated/accessible materials, documented timelines and correspondence, attention to marginalized subgroups (elders, women, youth), disclosure of compensation and conflicts of interest, and a feedback summary including signs of internal division or opposition.
5. Post-agreement relationship management — grievance mechanisms, disclosure of filed grievances and outcomes, and continuous engagement plans across the project lifecycle; regular, periodic re-affirmation of consent from community.

11. Is there any other feedback you would like to provide on the proposed MSS/DNSH framework?

A. Grievance Mechanism:
In order to reduce the risk of misleading or inaccurate self-assessments by users regarding compliance with MSS criteria, UBCIC recommends the establishment of a culturally competent grievance mechanism that enables affected Indigenous rights-holders to identify instances where users have failed to meet MSS requirements, including those relating to Indigenous rights. Such a mechanism would provide an important accountability measure by ensuring that Indigenous Peoples have a meaningful avenue to oppose and challenge mischaracterizations of Full UNDRIP Alignment and ensure that claims of sustainability reflect actual compliance with the taxonomy’s safeguards.

The draft report currently states that it is ultimately up to taxonomy users to demonstrate and disclose the extent to which they meet specific criteria (including any additional DNSH or MSS requirements) in order to claim taxonomy alignment for their activities (p. 19).

As previously noted, UBCIC is concerned that there is a broader trend in corporate self-assessment, including in material securities disclosure and voluntary reporting (such as in Reconciliation Action Plans), of companies omitting, minimizing, or misrepresenting their impacts on Indigenous rights and the resulting legal, financial, operational, political and reputational risks. See Living in a Material World: Turning Corporate Indigenous Relations Communications from Token to Tangible.

Unless clear criteria are established and affected Indigenous rights-holders have a meaningful opportunity to identify and challenge inaccurate self-assessments, we anticipate that similar shortcomings will arise in the context of the taxonomy.

Accordingly, it is critical that the MSS/DNSH frameworks establish a grievance mechanism or other accessible avenue through which impacted Indigenous Peoples can raise concerns where taxonomy users have misrepresented, understated, or failed to disclose their true impacts on Indigenous rights. Where such concerns are raised, the user's taxonomy-aligned status should be withheld or suspended until the impacts have been adequately addressed and the affected rights-holder(s) have confirmed that the rights impacts have been resolved.

B. MSS Disclosure for entity vs. activity level:
MSS and DNSH can be addressed at both entity and activity level. For example, MSS could be bolstered by evidence of an Indigenous rights policy or RAP, for example. However, if there are specific activities that violate their own policies or result in significant harm, it would negate an entity-level MSS benefit. The example of Rio Tinto, above, is illustrative of why an MSS policy screen is not enough on its own to uphold Indigenous rights.

12a. Do you agree or disagree with this approach?

Strongly agree

12b. Please explain your answer in the space below

UBCIC supports a Green category that explicitly excludes oil and gas and natural gas activities from its definition of environmentally sustainable activities. The designation of fossil fuel activities as “green” risks not only undermining the environmental integrity of the taxonomy, but also directing capital toward activities that have historically and disproportionately impacted Indigenous territories, rights, and communities. Given the significant role that fossil fuel development has played in creating environmental and rights-based harms, including impacts on lands, waters, biodiversity, and Indigenous Peoples’ ability to exercise their inherent and constitutionally protected rights, such activities should not receive the market signal, credibility, or capital allocation benefits associated with taxonomy-aligned status. A sustainable finance taxonomy must ensure that the “green” category reflects activities that meaningfully advance sustainability and a just transition, rather than facilitating continued investment in fossil fuel-dependent activities.

Note UBCIC’s submissions to Questions 4b and 10, which include requiring Full UNDRIP Alignment in order to qualify for this "Green" label.

13a. Do you agree or disagree with this approach?

Select

14a. Do you agree or disagree that the proposed guardrails for the transition category (both for the whole-of-activity and measures pathways) are sufficient to protect the science-based credibility of the category and reduce the risk of carbon lock-in, while supporting usability?

Select

18a. Do you agree or disagree with the proposed approach for developing technical screening criteria?

Select

22. Overall, how satisfied are you with the proposed sustainable finance taxonomy framework?

Select