Ikata Project, Northern Province, Canada (A and B) (The)
The Ikata area is located in the western region of the Northern Province, Canada. This area has been inhabited for centuries by around 200 people from the Hisala Nation and 500 from the Chisala Nation. In the 1940s, the government of the Northern Province considered exploiting metal ore and hydro power to industrialize the region. The very promising results of the provincial government’s feasibility evaluations led the International Corporation to take an interest in the economic potential of the area in a context of high demand for its industrial products in the post-war reconstruction era. The Ikata project met with mixed success. On the one hand, the International Corporation invested significant amounts in infrastructures that were non-existent in the 1950s and the project contributed to the development of the overall regional economy. On the other hand, the project caused the flooding of the Chisala First Nation's land, forcing them to leave their territory and ways of life on two-week notice with very little financial compensation. In the 1980s, the International Corporation announced its intention to complete the Ikata 2 project, which became controversial for several reasons. First, the Northern Province government’s exemption of the Ikata completion project from an environmental review outraged the local community (farmers, trappers, municipalities, First Nations, and the population in general). This brought major provincial and national media attention to the area and to the Corporation. Second, the First Nations started to question the events that had occurred three decades ago. Since 2011, the International Corporation has been working to rebuild trust with local stakeholders.
This case is designed to facilitate a group discussion about corporate-community relations and stakeholder management. The case can be used to raise awareness about the importance for companies to be proactive in managing community relations and the corporate risks of not doing so.