Douglas resigned as NDP leader in 1971, but retained his seat in the House of Commons. Around the same time as the leadership convention held to replace him, he asked the party not to buy him an elaborate parting gift. Instead, he and his friend and political mentor M. J. Coldwell were honoured by the party with the creation of the Douglas–Coldwell Foundation in 1971. He served as the NDP's energy critic under the new leader, David Lewis. He was re-elected in the riding of Nanaimo–Cowichan–The Islands in the 1972 and 1974 elections. He retired from politics in 1979 and served on the board of directors of Husky Oil, an Alberta oil and gas exploration company that had holdings in Saskatchewan.