The peculiarity of the benefit sharing mechanism during industrial development of the Arctic territories abroad supposes the participation of indigenous peoples in the distribution of profits of mining companies. In Russia, business and local communities interact based on compensation payments and agreements on the socio-economic development of their territory. For example, in the United States and Canada, such a mechanism for the distribution of benefits in the interaction of business and indigenous peoples is usually reduced to the problem of the distribution of financial benefits (profits) with the participation of local communities. Scientists consider the benefit sharing system and community agreements with the subsoil-users urgent. Ciaran O’Faircheallaigh suggested implementing community development agreements as a very important tool, especially in the case of mining industries when local communities are affected by the direct impacts of the industrial objects (environmental pollutions, social threats, etc.). As a rule, environmental and social costs incur in the territory developed by the companies while the profit concentrates in other places. This leads to conflicts between local communities and business [
13]. In Canada, the exploration and extraction of mineral resources is currently increasing significantly and this makes government and First Nation communities pay more attention to the responsibility of mining companies as they expand their economic activity into Treaty and Aboriginal lands. In most countries, as a rule, the benefit sharing agreements are confidential and concluded between mining companies and indigenous communities. They are specific for certain project and contain the list of the socio-economic and environmental benefits and responsibilities. During such negotiations, the methods to address local needs and involvement mechanics of tribal communities are the focus of many researchers [
14]. Brad Gilmour and Bruce Mellett believed that a contract should be preceded by a deep analysis of potential areas of community life that may be adversely affected by an investment project. In addition, the benefit sharing agreement must address future opportunities that could arise during project realization [
15]. Tysiachniouk and Tulaeva considered that, in Russian regions, there are various practices of concluding benefit sharing agreements: the peculiarities of the formation of various models of agreements on the distribution of benefits between oil and gas companies and indigenous peoples should be identified. It is important to understand what is significant in the process of their formation: regional specificity, dependence on international actors, features of corporate policies, the level of self-organization of local communities [
16]. However, partnership agreements between subsoil users and indigenous communities should provide as compensation for the land fund use, and direct participation in socio-economic development of the traditional lands. One of the tasks of the local authorities in addition to ensuring the interests of the territory and its inhabitants in relations with the company subsoil user could be the motive and stimulating the population to engage in economic activity using the received compensation payments [
17].
Analysis of literary sources and economic practice in the Arctic zone allows us to identify the following areas of wealth distribution during industrial development of the territory:
In Russia, the benefit sharing agreements can be realized as the Program on mitigation of the negative impact of the project (hereinafter—the Program). Negative impact supposes the changes in the traditional lifestyle of indigenous peoples, the need for adaptation and sustainable socio-economic development of local residents in the context of changes arising during the project. Such program may include:
Benefit Sharing Concept in Russia
The problem of protecting the economic rights of indigenous peoples is related to the fact that, in the Land Code of Russia, indigenous communities are not listed as subjects of law. Therefore, the transfer of land to them by law is not provided. Indigenous communities are forced to register as legal entities and then prove the right to land. However, if, for example, the indigenous peoples live in the forest, then the transfer of land is excluded, since the forest is federal property under Russian law. These and other conflicts in land legislation cause problems with the protection of economic rights, and therefore with the damage assessment to indigenous communities due to negative impact of industrial project as well as the compensation. Many indigenous peoples, Koryaks and Evenks, Nenets and Dolgans, during 2005–2006 lost their own national territories and autonomous districts, and they were united with other regions of the Russian Federation. It was a period of enlargement of the territories due to the unification. As a result, there was a derogation of the rights of indigenous peoples, including difficulties related to formal registration rights on traditional environmental management.
In Russia, the underdevelopment of the legislative system for the protection of the economic rights of indigenous peoples, including the distribution of benefits, means that, in a given region, the practice of interaction between indigenous communities and business is different. For example, in the Krasnoyarsk region, the damage to traditional lands is the result of negotiations. The local government does not use any methodology to calculate objective losses of indigenous communities and the traditional nature use. In the Yamalo-Nenets Autonomous District, to estimate losses and compensate indigenous peoples, it is proposed to proceed from the average income per representative of indigenous peoples living in the project’s area of influence. Such an approach does not link to the real damage caused to natural resources since the real income of the local population is low.
Therefore, the aim of the study was to summarize and develop approaches to estimate losses to the indigenous peoples. This was based on the experience using this mechanism in the Republic of Sakha (Yakutia) during 2011–2018 in the framework of conducting the ethnological expertise.
As for the terminological apparatus in Russia, the ethnological expertise of the project was a scientific study of the impact of changes in the indigenous lands of indigenous peoples and the socio-cultural development of an ethnic group. At present, the Republic of Sakha is the one region of Russia where law on ethnological expertise has been adopted. The act was adopted on 14 April 2010.
The ethnological expertise of the project should determine the degree of admissibility of a project in the territories that affect the places of residence and traditional economic activities of indigenous peoples. It should also determine possible losses of indigenous peoples.
Such an approach can be considered as one of the elements within the framework of the concept of distribution of benefits during the development of the territory in the Arctic.
Among the mechanisms that support traditional livelihoods of indigenous peoples in Russia, we can distinguish the procurement of products (fish, wild reindeer meat, berries, etc.) by the company, as well as the allocation of targeted grants to support traditional crafts and ethnic development. Today, in most benefit sharing cases, compensation payments prevail. During the Soviet period of the Arctic development, the state bore the brunt of responsibility and costs for the socio-economic development of the territory.
The research in Russia and abroad has identified the following types of benefit sharing in Arctic industrial development:
Paternalism: The state is responsible for the distribution of benefits, and assumes the main functions for the development of the territory. This type of regulation of environmental management has developed, for example, in Alaska, the United States.
Social responsibility of the company: The mining companies play an important role in the development of traditional nature use areas, and act as the main carriers of goods and distribute them. An example of such companies is Arctic Capital LLC or Almazy Anabara JSC in Yakutia. They engage in mining of placer diamonds and gold in the Arctic regions [
13].
Partnership: This type of interaction has developed on Sakhalin. The public–private partnership realized between a company and local communities aims to distribute the benefits during the natural gas production on the shelf. This also applies to the benefit sharing system in Canada.
Contract system for distribution of benefits and traditional crafts support: In this case, the main role in benefit sharing belongs to non-governmental organizations that carry out the economic and non-material assistance individually for indigenous peoples, for their families, tribal communities and other groups.
The shareholder model: This system supposes that indigenous peoples realize their rights as the owners of shares. Such form of the interaction between indigenous peoples and investors has been developed abroad (Australia, USA, and Canada). In Russia, for example, in the Arctic territories of the Yakutia, some indigenous communities express interest in implementing the shareholder model.
In Russia, due to legislative conflicts and the imperfection of the land ownership system of indigenous peoples, the implementation of a shareholder system is difficult, but the practice of implementing the contract system and partnership, as well as social responsibility, is well developed. However, in each case listed, the basis of negotiations on measures to support the local population should be clearly described as well as potential losses, damages and risks to local communities. At present, the calculation of losses for compensation is currently the main mechanism for a fair negotiation process between indigenous peoples and the investors.
Traditional nature use depends on the natural resource base of the territories determined by the climatic conditions. The main criterion is the natural-ecological differentiation of the territory according to the nature of the distribution of vegetation:
The authors’ concept of calculating losses to indigenous peoples was based on the methodical approach of the resource assessment of the territory. This considers the potential income of the local population using available natural goods (reindeer pastures, water, rivers for fishing, areas for hunting, sites of vegetation for gathering berries, mushrooms, medicinal plants, etc.). In essence, it is proposed to determine potential incomes and losses, if this territory would be involved by the indigenous population in economic circulation (although this territory may not be used at the time of the study). The proposed method could be used in the case of temporary withdrawal of these territories for the project.
The authors used the indicators of resource productivity of the territory to determine losses to indigenous peoples in Yakutia. The analysis of ethnological expertise showed that many natural goods have no market value. The local population uses them for their own consumption. There are no established market prices for traditional products (meat, fish, wild plants, berries, and mushrooms), and standards have not been developed to characterize the biological productivity of land in different Arctic areas (the density of hunting resources per 1 ha, the productivity of fish per 1 ha, etc.). These and other methodological questions determined the need for the development of methodological approaches to calculate the losses. Other issues of methodology development include tools for geobotanical zoning of the territory, taking into account the allocation of exclusion zones and stress zones (indirectly, passively affected areas) [
18].
Among basic sectors of traditional economy, domesticated reindeer herding is considered as the main type of economic activity preserving traditional culture. A special feature of this industry is the year-round grazing of animals by shepherds, which forces them to use their language, customs and traditions every day. Reindeers in the literal sense feed the indigenous peoples: they give the main food (meat), are used as a vehicle, provide traditional winter clothing or shoes and are an indispensable tool for the construction of yurts. Only in reindeer herding do the indigenous peoples not encounter competition from the dominant society. Hunting and fishing also play important roles for indigenous peoples and their communities. For example, “The Yukagir” tribal community—a hunter–fishermen aboriginal family from Ust-Yansky region in Yakutia—owns an area of 1914 thousand hectares. The are 17 members of the community, 15 of them men. They hunt, fish and mine mammoth tusks. The main sources of income for the community is commercial fish (
coregonus nasus, coregonus, and coregonus albula) with a total volume of 52 tons, which is more than 5 million rubles [
19].
Consider the case of losses’ calculation of indigenous communities due to investment project in Anabar region. This project aims at the exploration and extraction of placer diamonds on the Polovinnaya River. The project is being developed by Arctic Capital LLC. The area is related to the territories of traditional nature use [
20]. The indigenous communities perform reindeer herding, hunting and fishing there. The license area is located in the valley of the Polovinnaya riverbed and its tributaries (
Figure 5). The total length of the study area is 75.4 km.
The project means partly and temporary traditional lands withdrawal. Therefore, the losses of reindeer herding, hunting, fishing, and gathering wild plants (berries, herbs, mushrooms, etc.) are the main indicators and defined based on the decreasing of traditional lands’ productivity. The mine site has been divided into the exclusion zone and the stress zones. For the license period, it is assumed that biological resources are inaccessible for traditional nature use only in the exclusion zone, so their economic reserves are subject to compensation.