Welcome to Drumbeats, the must -listen -to podcast
which explains why Indigenous partnerships are
the key to securing successful outcomes in natural
resource and infrastructure investment in Canada.
I'm Mark McNacca, and my co -host Robert Brandt
and I are joined today by Catherine Pennington,
Director, Indigenous Advisory Services, KPMG
Canada, where she discussed her background in
social work and transition to the energy sector.
She emphasized the importance of Indigenous relations
in corporate projects, citing Bill C -5's components
on labour mobility and project expediting in
particular. Pennington highlighted KPMG's Truth
and Reconciliation Action Plan and its focus
on Indigenous equity, commercial structuring
and financing. She noted the need for skilled
Indigenous relations professionals and the role
of international models in guiding Canada's practices.
Pennington also stressed the significance of
Indigenous participation in major projects, including
infrastructure and energy, to unlock billions
in private investment necessary for these projects
to come to fruition. Catherine Pennington, the
Director of Indigenous Advisory Services at KPMG.
Great of you to join us today on Drumbeats. Wonderful
to be here. Thank you so much. It's such an opportunity
to spend some time with the two of you on some
very important discussions. Yes, great to have
you with us, Catherine. So why don't we get into
it? Why don't you tell us a little bit about
yourself? Where did you grow up and how does
your educational background and work experience
shape your path to where you are today? And you
have some items you'll have to talk about sometime
during the conversation. I certainly will. Well,
yeah, thanks again for having me. It's such a
pleasure to be here. So I'm, first of all, I'm
joining you today on the traditional and unceded
territory of the Klele -Tene people in North.
central British Columbia, otherwise known as
Prince George, BC. And I've had the opportunity
to live on this territory as a guest here for
about the last 15 years. But I'm originally from
Treaty 6 territory in the Métis homeland. I'm
a citizen of the Métis Nation of Saskatchewan
by birth, born and raised in a small little community
called Duck Lake, Saskatchewan. And I always
like to talk about that because it has about
500 people. And for a lot of people in the world,
500 people is a pretty small number. But I think
it had like a really significant... shaping of
me and the way that I see the world and the way
that I operate in the world. So a citizen of
the Métis Nation of Saskatchewan by birth, now
a citizen of the Métis Nation of British Columbia
based on where I live here. And yeah, you know,
I spent the last 20 some years in the energy
sector, but I didn't come to the energy sector
in the traditional way. And I don't actually
believe that I practice in industry now as the
director of Indigenous Advisory Services for
KPMG in maybe the traditional way. So I know
that a lot of the conversations that you folks
have are around capital markets and investment.
We're going to talk a little bit about that.
today. But my disclaimer is always that you are
talking to a social worker and a psychotherapist.
I'm not a banker. I don't have a background in
technical finance or engineering. But I came
into the energy sector from social work. I was
working at the time for a number of years in
family services and child protection. And I had
an opportunity to go into industry. I actually
got a phone call one day from a company. We were
living in the very far north of the Northwest.
territories, border of Canada and BC. And there
was this opportunity to join, at that time, an
Aboriginal relations team. It was an interesting
transition. I took the opportunity because I
think I knew even then, like 25 years ago, that
I could probably do better social work. inside
an organization, inside a company and affect
change in a way that I was unable to do on the
front lines of social work. Now, I have great
respect for my peers that have remained in social
work. But for me, I thought if I can affect Indigenous
peoples and jobs and opportunities, and if I
can work with communities in a way that's around
economic development, that's going to affect
everything. That's going to affect... jobs and
employment, poverty. And really, from my perspective,
you know, being a social worker, often I say
like at 11 o 'clock at night on the doorstep
with the RCMP, that's like front end crisis social
work. I was more interested in being on the upstream
side of social work. So spent a number of years
in the energy sector, the upstream, the midstream
and energy transportation on the pipeline sector
side. And then over the last few years have transitioned
here to KPMG and really love it because it's
an opportunity. to work with so many different
companies and sectors. And I really enjoy that.
Most importantly about me is I'm a mother. I
have two children. My daughter is 18 and in pre
-med, studying biochemistry. I don't know how
on earth she can do that. For a social worker,
that's really amazing. And my son, who's finishing
high school and has a real interest around justice
and psychology. So I probably have more in common
with him on that side. but very lucky to be a
mother and to have two amazing children. And
my husband and I live here in Prince George and
we really love the North. We've always really
loved the North. Growing up in North Central
Saskatchewan stays with me. It's like really
who I am. So I think I always valued the opportunity
to live in Northern Canada. So thank you. Wow.
That's a really interesting backstory, Catherine.
And when this podcast goes out, I'm going to
forward it to my son, who's a social worker and
still on the front lines. But he and I have discussions
about some of the similarities between our work,
my work, economic development, and his work on
the social side, both trying to achieve better.
standard of living and outcomes for Indigenous
peoples just in different ways. But that's really
interesting how you found your way into the corporate
world after starting out on the front lines.
It wasn't a terribly difficult transition. I
think coming from a social work and social services
background. Working predominantly with Indigenous
communities at the time around things like social
welfare delegation, like the ability for Indigenous
communities to have custody and control over
child welfare, which continues to be like a really
significant challenge for our country. But when
I was transitioning, the skills that were needed
there were also needed working within industry
and community. You know, the ability to listen,
to summarize, to understand, to peace build,
conflict resolution. So I felt very fortunate
that I always worked for companies that really
valued that skill set. And I think that it does
go to show, Rob, that what you study in life,
you may end up doing very different things, but
the core skills are what's most important. understanding
the whole world that we live in the visible and
invisible uh that thinking is actually where
corporations are going today right that's why
esg became an issue and climate change because
we realize this holistic thinking is is important
so you know kudos to kpmg for bringing you on
board but i think that's just part of the process
and as you said that's what makes decisions happen
because you have to understand all of that the
top down doesn't work in many places many more
across societies as a whole we really all have
to work together and bring everybody along to
get those successful outcomes that that we want
i've recently um had the opportunity to Speak
a little bit about Bill C -5, which is, of course,
quite a hot topic here in Canada. It's an enactment
that has two components. One is around labor
mobility, which I think is so crucial for our
country. We need to be able to move skilled labor
trades. intellectual property across this country
barrier free in order to really like meet the
moment. And then the other component of that
is, you know, the other legislation really focused
on the expedition of projects and a number of
initiatives around that. And one of the things
that I think is going to be so crucial, Mark,
to your point is we're going to need like never
before, really skilled Indigenous relations professionals,
because those are the people who are on the front
line. who are working with Indigenous communities,
who are building relationships, who are often
the conduit between the corporate and the investment
community and the Indigenous community. And I
think that mistakes that have been made in the
past have been that we have not invested in Indigenous
relations departments in the way that we needed
to. for, you know, it's a continuum and an evolution,
right? Like we've seen the beginning of my career
was really focused around pre -legislation in
many cases, was focused on can you get Indigenous
people to participate in the supply chain? But
there were no systems or processes like to really
maximize participation. So that didn't work that
well. So that had to evolve and grow. We've seen
this evolution now to Indigenous communities
on the equity front as investors and all of these
amazing tools to help Indigenous communities
as investors. But I think what we really need
to think about is how do we as corporations facilitate
getting to Indigenous -led projects, Indigenous
equity and partnerships? Well, it's going to
be the people that you invest in who are helping
you to build those relationships. So I think
the era of... you know, having very minimum staff
or that being a department low funded. I just
think those are over. If you want to build a
project in this country, you're going to need
the best Indigenous relations people that you
can find and they need to be very skilled and
they will be. You've talked on two interesting
points coming back to Bill C -5 with its two
components, because a lot of our listeners and
viewers won't understand when you're talking
about what do you mean freedom of movement of.
to use a european term freedom movement across
provinces because there are barriers to skilled
individuals moving moving across with the different
trades etc so that's something that's trying
to being addressed and it looks like there's
a lot of momentum with the provincial leaders
in that regard which is just as important so
it's not just how do we work in partnership with
the indigenous community it's how do we set up
canada to succeed in a very competitive and demanding
economic environment. So there's that whole regulation
side, as well as how to work successfully within
Indigenous peoples who are our rights holders
and not just looking, oh, can you solve this
little problem for us? They want to participate
and learn. You want to participate and learn.
So you can end up leading some of these organizations.
Perhaps one day KPMG will be led by. indigenous
person there's that should be in the realm of
possibility for anyone yeah i think that um and
i'm certainly not an expert on like labor issues
or labor mobility in the country but i i do know
um just from leading indigenous skills training
programs through a good portion of my career
as part of indigenous relations efforts and working
with communities It is very challenging for organizations
and major projects for labor mobility in the
country. And that has been a real challenge for
us. I think this enactment is looking at ways
of alleviating that. And I think, Mark, you're
right. There's a deeper appreciation and understanding
of this being a really important effort. I think
we also are under this existential threat with
the Canada -U .S. situation. And a recognition
that we really need to bolster our internal resources,
meaning our people and our human capital, to
help us move major projects, to move along and
to build that brings everyone along. There's
definitely an ongoing challenge with Indigenous
skills, and we really need to invest in that.
I mean, I think in this country still, depending
on where you are, depending if you're First Nation,
Inuit or Métis, on average, on aggregate, the
graduation rate is still around 70 % of that
of non -Indigenous students, right? So that's
really significant. That's like 30 % of our kids
are not graduating high school. So we need to
be thinking about... I think, in parallel to
major projects and Build Canada, are we also
going to be parallel efforts really investing
in Indigenous youth so that they have an opportunity,
they see themselves in the picture? I like to
say that you can't be what you can't see. So
we need to help younger people really see an
opportunity in the trades, in sectors around
major projects, probably in all positions. as
that opportunity for the next generation to participate.
Not just about mobility, but capacity, capacity
building, particularly within Indigenous communities.
Catherine, what about KPMG's group, the Indigenous
Advisory Services Group? What does it look like
and what sorts of things do you work on? Well,
the KPMG Indigenous Advisory Services team is
like really a dedicated group of professionals
that have unique skill sets of working with Indigenous
communities. But I always like to say that it's
fascinating to me, like KPMG. has been a tax
and audit provider. We're really well known for
tax and audit. In fact, when I meet people and
I say, oh, I work for KPMG, they're like, oh,
are you an accountant or do you work in tax?
And I think like the day that I'm doing any math
is that a bad day. Like you should stop whatever
I'm doing. I have no capacity for that. I'm,
as I said, you know, I'm really focused on the
social outcomes piece and health. But KPMG has
been involved in Indigenous communities. There's
some communities that some of our tax and audit
team have been working with for like over 20
years. I think that speaks to the depth of relationship.
Like this is a firm that understands the importance
of relationship. There is a very difficult space
to work in. So I think it really speaks to long
-term relationships and the company's interest
in investing, the firm's interest in investing.
And investing is exactly what they did. In the
advisory space, which is outside of tax and audit,
over the last few years, there's been ongoing
recognition and investment of hiring people like
myself to come in and lead Indigenous advisory
services. We have a larger Indigenous client
services team that focuses on all of the aspects
of the firm, and this is growing. also stems
from our Truth and Reconciliation Action Plan,
which unlike other corporate plans that I've
seen and been involved in, is very detailed.
So when you look at our Truth and Reconciliation
Action Plan, which I should just note, I think
is amazing because we were the first of the big
four firm to invest in developing a Truth and
Reconciliation Action Plan. Catherine, can you
just give for our viewers and listeners a bit
of background? Truth and Reconciliation Plan,
just... Short summary again to reinforce where
that came from and why an enterprise such as
KPMG saw that was important to do. Thanks, Mark.
So truth and reconciliation plans or truth and
reconciliation action plans, otherwise known
as reconciliation plans, have become significantly
more popular among the corporate Canadian landscape
over the last... five or six years. Now, it's
been 10 years in this country since the Truth
and Reconciliation Commission released its report
and findings. And that was a significant national
undertaking that interviewed residential school
survivors, Indian residential school survivors,
Indian day school school survivors. and also
focused on health institutions. And it uncovered,
of course, I think, as most people know, the
atrocities that occurred in the residential school
system. It identified acts of colonization that
had a signal. All acts of colonization had a
detrimental outcome, but in particular, as it
related to the schools. And with that, put forward
a number of reports and calls to action. And
one of the subset of calls for action was for
the Canadian corporate sector to take action
around employment and skills and training and
awareness to ensure that Canadians were aware
of what happened. And I'm certain that I think,
you know, Rob, you've probably spoken about this
and maybe others of your guests have that. residential
school survivors and the legacy of residential
schools is not a two or three hundred year old
thing it for many of us our parents our grandparents
our aunties and uncles and cousins went in my
family I have you know family members that went
to residential school there are those of us that
are the first gen that were not in residential
school So I think that it's a very real legacy
that we're living. It accounts for the trauma
that we've seen in communities that, of course,
addresses what I talked about earlier. It impacts
child welfare and incarceration and poverty.
So it is not a long -ago problem. It is a very
recent, recent thing that is still affecting
our communities today. Corporate Canada, many
organizations in corporate Canada either have
or are taking action through developing of these
plans that help them to map out the mechanisms
and the resources and the steps that they're
going to take as a corporation or an institution
to address it. So KPMG is an illustration. We
focus on education of our internal staff. We
have 10 ,000 people. It really moves the needle
when you invest in your people understanding
the legacy of residential schools, of colonization,
of systemic racism, which, of course, affects
up until recently the ability of Indigenous communities
and institutions to even borrow money to invest
in economic development. We're seeing a real
seed change there. But institutionally, our Truth
and Reconciliation Plan is also focused on investing
in youth. It's around employment and training
and hiring. and around retention and best practices
of how we serve our clients. And we've done an
update report. We launched our initial report
in 2022. We did an update report for 2023 and
2024, and we're into a refresh now for 2025.
But we take our Truth and Reconciliation Action
Plan very seriously, and it influenced the firm's...
steps around building out Indigenous advisory
services. So we focus on a number of different
areas. We work with Indigenous communities, we
work with government, and we work with industry
on a variety of topics and interests as it relates
to working with Indigenous communities. area
for us that has really been growing and really
been focused is our team that works on equity
and commercial structuring and financing and
equity benefits and participation, helping Indigenous
communities to really maximize their opportunity.
So there's kind of that link between the Truth
and Reconciliation Action Plan and the work that
we do at KPMG and the interconnection. And we're
located across the country of a national model.
And these days, we're very focused on infrastructure
and capital projects and sustainability. But
we also have a division at KPMG within advisory
that focuses on health and child welfare and
social outcomes. So the social worker in me loves
to be in both spaces here. I get to satisfy my
interest in all areas. KPMG published in this
year their private capital study. demonstrating
that CIB -backed projects could unlock over $30
billion in additional private investment across
Canada. How do you see Indigenous participation
contributing to that? And what does that really
mean for everyone? Yes, I mean, first of all,
that report identified a couple of really critical
things, right? Like this unprecedented need around
certain aspects like connectivity and major projects
and climate adaptation. identified that overwhelmingly
business leaders were very positive and felt
very strongly about the development of a national
energy corridor, modernization of ports and the
importance of modernizing supply chain. I think
that when we look at building anything in Canada,
it is going to require Indigenous participation.
I think gone are the days that you're going to
build. and move forward without Indigenous participation.
I think probably every guest you've had has probably
reinforced that message. It is a non -optional
requirement. And in order to move a project forward,
especially for those projects that want to be
a part of the Bill C -5, be on this project's
list under Bill C -5 and the expedition of these
expeditiousness of these permitting associated
with major projects. you are going to need Indigenous
partners like never before. And I think that
it will mean that in many cases, projects will
not just have equity opportunities and the opportunity
for equity participation might mean co -developed
and co -led. And I think that this, you have
to look at partnerships through the development
and through the... the crystallization of what
that project is going to look like. So my sense
is that it is necessary for proponents to establish
early relationships, very much like grassroots
up instead of top down. And that is going to
require incredible skill set to work with communities
early on in the process to have buy -in and how
you're going to get that. is through not only
addressing the environment and social issues,
which are always critical for communities. The
most important thing is around environment and
social issues. But then following that is the
economic participation pathway. Now, not all
communities are going to be necessarily interested
in equity. There may be certain projects or certain
reasons why equity is not of interest. But that's
then going to look at other opportunities around
revenue sharing or benefits agreements, inclusion
in the supply chain. Very robust agreements are
going to be the requirements for the foundation
for the future. And we're seeing that. And of
course, we're seeing Indigenous -led projects
in this country, like Solisms and Cedar LNG and
Oneida Battery Storage, right? There are many,
many illustrations and examples of that. So I
think the report... highlights the need for capital
and capital investment. In order to get there,
we're going to need Indigenous participation.
And Catherine, has KPMG identified foreign investors
as a potential source? Do you see a need for
foreigners to get involved or can the Canadian
capital markets provide what is needed, do you
think? Well, this is where I take the social
worker disclaimer and say I'm not an expert in
capital markets or finance. But I mean, my understanding
is that we are going to need investment and capital
investment from a global source in order to meet
the moment. We have significant projects and
interests and infrastructure dreams in this country.
It is a big country, not a lot of people. We're
going to need resources. from investors. And
we've seen an emergence in Canada over the last
number of years. Many of your guests talked about
the Indigenous Loan Guarantee Programs and the
provincial programs and Cedar Leaf Capital and
other investment tools that are available, even
utilizing life insurance companies and other
mechanisms to help fund for ownership and participation,
ensuring that the rate is appropriate so that
the return on investment is maximized for Indigenous
communities. But I think as a country, we're
going to need those investors. And, you know,
Rob, I remember when I was working in an ESG
capacity in a large company, I learned that our
ESG evaluators were almost always from overseas.
They would be from Scandinavia. That's quite
common. And the way that those ESG evaluators
would determine our corporate scorecard was often
by like news clips. It was often by social media
and news clips. There wasn't much, if any, on
the ground interviews of Indigenous communities.
So what would happen would be, you know, working
for a pipeline company, you can imagine when
you do a scan in social media, you do a scan
online, what you see is a negative response.
You see old footage or you see perhaps curated
footage, and that sends an international investor
a message. that this is not a place to do business,
this is not a good investment. And many of those
messages talk about long -tenured projects a
decade ago that were not necessarily successful
because of challenges that were occurring. We've
evolved since then. Indigenous communities, by
and large, although not a monolith, are not opposed
to development, but they are certainly opposed
to development that was done from a top -down
process that did not... respect their rights
or their interests and did not include them.
So I think that we do need capital investors
and we need those investors to know and appreciate
and understand that maybe what they see in the
news is not necessarily the truth. And I think
podcasts like this are helping to get information
out in a world that is often full of information
and not necessarily correct information. Yeah,
this podcast and also our summit, our annual
Indigenous Investment Summit in London. One of
the primary reasons for doing that was to change
the message and the perception that foreign investors
sometimes had, often had when it came to development
in Canada, that frustrations from the past. So
the message is that things have changed. It sounds
like you're encouraged at least by where we are.
today and how far we've come, say, in the last
five to 10 years? I am so encouraged, and I'm
also very optimistic. I'm encouraged because,
you know, I think this is fascinating. So I think
most Canadians would agree that the regulatory
and legislative systems that have been in place
over the last eight to 10 years have been very
restrictive and very challenging. And as a result,
we have not seen as many major projects move
through the regulatory process because it was
very cumbersome and very complex. And I think
many Indigenous communities would agree with
that. And yet, interestingly enough, like maybe
even in spite of that or because of those complex
systems, we've seen this incredible momentum
in the marketplace of the Federal Indigenous
Loan Guarantee Program over 20 years ago. I remember
working with the federal government and Indigenous
communities to get drilling rig loans. And we
were successful. I think two or three of those
loans, it was federally backstopped. It was a
pilot. And we worked so hard to get that like
early on with some Alberta nations. And that
was like a huge success. But then it took the
next like 20 years to get to now the federal
loan guarantee program. And I know that. organizations
like the First Nations Major Projects Coalition
and other groups advocated tirelessly, industry
groups and industry leaders advocated for that
program. We're seeing provincial loan guarantee
programs and a number of other tools that are
allowing, finally, Indigenous communities to
be investors. creates that own source revenue,
which then you can invest back into education
and health care and elders and schools and other
economic ventures. It creates wealth. Maybe we're
going to actually get to a place in our country
and within our nations where we're going to be
managing wealth and not poverty for the first
time. post -colonization. I'm very, very optimistic
and excited by what I'm seeing. I think that
if done right, Canada's on this incredible trajectory
like we haven't seen in decades. We really can't
squander that through not working with Indigenous
communities, ending up in, you know... prolonged
and protracted legal processes and remedies court
is a blunt instrument, we will miss the window.
So I'm very optimistic about what I'm seeing
in industry. I have seen a sea change in industry.
I can even think three or four years ago, not
that long ago, many corporations would have said,
we would never have Indigenous equity in our
operating or brownfield asset. It would have
to be greenfield. Many of those same companies
have changed their tune and they're now working
actively for investment into existing assets.
So we're seeing equity not just on new projects,
but on existing. Significant shift in our thought
patterns and how we work together. We have a
long ways to go. And Rob, you talked about community
capacity. I think that is something else I would
point out that as a proponent in this country,
if you're going to build. You are going to have
to invest not only in your internal teams, but
in what the community needs, because community
capacity continues to be a challenge, not for
all nations, but certainly for many. So very
optimistic with the right ingredients, we're
going to have a great outcome. Well, I think
you've defined this inflection point for Canada
very well. That's our sense as well, and one
of the reasons behind what we're doing, because
we think this is a critical moment for the country.
And if we all work together and achieve, Canada
will become an exceptional place for the Indigenous
people and those who came after will have created
something very unique in the North American continent
and perhaps others. Just coming back briefly,
Catherine, you're part of a global firm, KPMG.
I'm not sure how much interaction you have with
some colleagues internationally. But if you have
had some interaction, what is their response
when they hear about this Indigenous group in
Canada moving things forward? How do you think
globally KPMG has an awareness of that and reacts
to that? I think one of the advantages of working
in a global firm and a very global firm is the
commitment to continual learning from our colleagues
in other parts of the world. So I can think about
some of my colleagues in Australia, and we've
actually had some recent exchanges where colleagues
in Calgary were in Australia working with mining
companies and identification of innovation around
mining and also clean energy. And there's some
incredible learnings that we can garner from
that and then them from us. I think there's going
to be more and more opportunity to learn globally
from one another. Indigenous communities work
internationally. And I'm glad you actually asked
this question because lately I've been thinking
a lot about as a Canadian, as a Canadian firm,
I and my peers. Thinking about this window that
we have of opportunity, to your point, Mark,
that if done right, is going to be the significant
turning point for community involvement in projects,
ownership, control, governance. And are we really
looking enough at the international models? And
I don't know that we are. And I think that's
a real call to action for me and my peers to
connect with other places that are still on their
journey, but we can learn from. And we need to
be able to move quickly. But what's the saying?
Think slow, act fast. So I think we need to employ
that. Catherine Pennington, the Director of Indigenous
Advisory Services at KPMG, thanks again for your
time and your thoughtful comments this morning.
Thank you. It was such a pleasure to be here
and what an enriching conversation and dialogue.
I look forward to continuing it. Thank you. It
was great to have you on our podcast, Catherine.
We look forward to meeting you again in the near
future. Thank you to Catherine Pennington for
sharing your insights with us, and thank you
for viewing and listening. Mark your calendars
for the upcoming 2026 Summit, taking place on
the 8th of April. Be sure to share, subscribe,
and leave a review on your favorite podcast channel.
Thanks for listening to Drumbeats. Until next
time.