Birthright corporations: many rights, few obligations


What are the obligations of aboriginal birthright corporations towards their shareholders?

Legally, there aren’t many. Legally, Inuit birthright corporations are privately-held corporations, and under the law, private corporations enjoy the same rights, more or less, as those enjoyed by persons. Except for those corporations that are publically traded on stock exchanges, private corporations have no obligation to provide information about themselves to the public. Conversely, the public has no right to violate the privacy of such corporations, any more than they have the right to violate the privacy of a person.

Because of this, Inuit birthright corporations enjoy many rights, but are burdened by few obligations towards their thousands of shareholders.

In Nunavut’s case, these shareholders are land claim beneficiaries who have already surrendered for all time the only thing they owned that Canada really wanted from them — their aboriginal title. The labyrinthine web of organizations into which Nunavut’s Inuit birthright corporations now fits represents much of what Inuit received in exchange for that surrender.

Given this context, how can the thousands of Inuit beneficiaries in the Qikiqtaaluk region fairly and properly judge how the Qikiqtaaluk Corporation and the Qikiqtani Inuit Association have handled the sudden departure of QC’s chief executive officer, Pitseolak Pfeifer, and the serious allegations that Pfeifer is reported to have made against QC President Jerry Ell?

So far, QC and QIA have acted as if they have many rights, and few obligations. Because of this, beneficiaries — and other members of the public — have so little information about the situation that it’s impossible for them to make a reasonably informed judgement about it.

We do know that Pitseolak Pfeifer wrote a letter of complaint to one person, QIA President Pauloosie Keyotak, alleging that QC President Jerry Ell committed fraud and breach of trust, and misappropriated funds from the Inuit of Baffin. We do know that Jerry Ell is preparing a defamation suit against Pfeifer, even though Pfeifer has done nothing so far to cause the contents of that letter to be published or broadcast.

This by itself sends an ominous message to any beneficiary who in the future may wish to make an honestly held complaint about the affairs of the organization that they own — even when they do it through normal channels.

We also know that QIA asked a local accounting firm, Mackay Landau, to conduct what they call an “investigation” of the allegations that are reported to be contained in Pfeifer’s letter.

The results of that so-called investigation, however, may be tainted in the eyes of beneficiaries. Mackay Landau regularly performs work for both QIA and QC, a situation that creates an appearance of conflict of interest.

If Jerry Ell is truly blameless, as he so resolutely insists, then he deserves a fair and proper exoneration. Unfortunately for him, the auditor’s report falls short of achieving this. If he is not blameless, then the thousands of Inuit beneficiaries in the Baffin region deserve a full explanation of what happened. The auditor’s report falls short of achieving this also.

QIA should have turned the allegations over to either the RCMP for a commercial crime investigation, or to a forensic auditing firm with no prior history of work for either QIA or QC. Either course of action could have produced an acceptable investigation.

To be fair, this was a difficult, and no doubt painful episode in the history of two organizations that otherwise appear to be serving their beneficiaries well. But the larger questions remain: What are the public obligations of a private birthright development corporation that is owned by thousands of people? And what safeguards do those beneficiaries have against corruption? JB

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