News Releases and Op-Eds
D'Avignon and Ross: 'Green shoots' of First Nations business development (Vancouver Sun)
By Ellis Ross, Chief Councillor, Haisla Nation and Greg D'Avignon, President and CEO, Business Council of British Columbia
A critical cornerstone of reconciliation is building economic opportunities for First Nations at the community level. There is a strong, positive correlation between economic empowerment — generating investment, business ownership and jobs — and improving social conditions.
As The Vancouver Sun series First Nations Inc. has shown, we are rapidly moving down this path from a business formation and economic development perspective.
To measure these advancements, the Aboriginal Business Investment Council, with the Ministry of Jobs, Tourism and Skills Training, have funded and developed a database which provides B.C.’s first comprehensive accounting of First Nations business development and economic benefit agreement activities.
The data, which will be publicly available later this fall, highlight the sea change occurring in many First Nations communities as rights and title interests combine with higher educational attainment and economic development agreements to spur increased First Nation business formation, jobs and growth. Results to date include:
- 1,099 self-identified aboriginal businesses, with over 600 small businesses run by individual First Nation entrepreneurs. The businesses, which continue to grow in number each year, are in a variety of industries including those related to tourism, arts, recreation, land development and resource extraction. • Over 50 community-owned development corporations which have been the major economic driver for many First Nation communities and constitute many of the larger businesses in the database.
- Over 80 formal joint venture relationships between First Nations and businesses.
- The database also contains 288 agreements between First Nations and government or industry, including 43 impact benefit agreements signed over the last 10 years between industry and First Nations.
- 27 revenue sharing agreements between government and First Nations on mines and clean energy projects in the last five years.
- First Nations have signed agreements relating to 12 of B.C.’s 19 operating metal and coal mines, as well as many proposed mines.
- The database also highlights the absence of large First Nation businesses (businesses with 500+ employees) or businesses in industries such as the technology or manufacturing sectors.
While not a complete picture, the data are compelling in showing that the momentum for economic reconciliation is leading to two important results: First, there is a growing business culture in First Nations communities that can be further cultivated and built upon. Second, there is considerable work being undertaken to build both social license and the formal relationships between industry, government and First Nations that underpins successful development. In this regard, despite some specific project conflicts, the overall picture is one that shows resource development moving ahead. This trend is taking our collective resource wealth and spreading it more equitably, with the agreements in the database transferring tens of millions of dollars in revenues to First Nations each year.
As we look ahead to the future, one of the critical pieces of policy work and analysis that needs to be done is to create the tools that allow the implementation of agreements and revenue sharing to unfold more efficiently and to take this wealth and build stronger business structures in First Nations communities. No investor is more motivated to realize the benefits of investment in British Columbia than our own First Nations — and the first businesses they look to are those in their own backyard.
As we go about this work, we need to think bigger. Although there are many avenues for starting a small business, First Nation businesses do not have access to many of the debt and equity tools to grow past a certain size. This is a serious and immediate issue for meaningful First Nations involvement in the LNG sector. These are large projects of up to $36 billion — in order for First Nations to be meaningfully involved, we will need to have large businesses with the ability to scale to meet the demands of large LNG operators. This means that we must start thinking seriously about creating tools such as loan guarantees and more effective deployment of private equity to allow First Nation businesses to grow.
We know there are many more agreements coming as industry and governments continue building the ‘New Relationship’ with First Nations and continue the sometimes challenging work of economic reconciliation. The requirement now is to take these “green shoots” of First Nations business and embrace the fact that First Nations will increasingly have a significant place in British Columbia’s business community and economy over the coming decades.
As published online by the Vancouver Sun