Natural Resources Committee on May 7th, 2019

[Chris Karamea Insley]

Yes, Ted, it was particularly in relation to the treaty process, not general litigation. The treaty process, from our experience, can be lengthy. That typically means a process that can take tens of years and have a very high cost. In our experience, it can be quite divisive and damaging to relationships. It was particularly in relation to the treaty, but I don't want to undermine the importance of the treaty as a founding document. It is critically important.

[Ted Falk, Conservative, Provencher, MB]

Thank you for that clarification. I thought that's what you were saying.

If you don't go down that route in your negotiations, what are the critical components of a negotiation that you do focus on?

[Chris Karamea Insley]

I'm going to just underline the previous points we've all made, namely, the need to start the discussion early and that both parties to that discussion be very honest, sincere and transparent. Certainly in our experience in New Zealand, as many of our people have gone off and become highly trained in all of the various fields, whether it's science, finance and banking or any other fields, we have people who are highly sophisticated and increasingly tuned in to best practices around the world.

In going into those negotiations, indigenous people can get a sense very quickly as to the sincerity of the other parties to engage. If the other parties are not alert to that, it can damage the discussion.

Be in it for the long haul, start the discussion early and be transparent in everything. They are guiding principles, I'd say.

[Ted Falk, Conservative, Provencher, MB]

In these negotiations and in your development agreements, are there particular issues that are always in contention, or obstacles to an agreement? Can you give us some guidance on that?

[Chris Karamea Insley]

It's really interesting. Again, I'm thankful for the line of questioning. Often, particularly when you go into a commercial discussion, most of the discussion is around the commercial elements of that negotiation, i.e., the quantum of financial redress. Treaty issues, however, are often not about the amount of financial redress. Often that's actually the last thing that gets discussed. The first thing that gets discussed is a recognition that some issues from the past should be acknowledged. Get those acknowledged first, and then the discussion will shift to addressing a lot of the social issues in the community. Then what happens—and I've been involved in some of these recently—is recognizing within any agreement the need to look after the land and the environment.

Take care of those important drivers, and then you get to the final point, which is agreeing on the financial redress. It's pretty much in that order. It's not the economics first, and all of the other things later.

[Ted Falk, Conservative, Provencher, MB]

Thank you for that.

Mr. Beamish, I'd like to ask you a question as well. You've raised capital, you said, from eastern Asian markets.

[Robert Beamish]

Yes, that's right.

[Ted Falk, Conservative, Provencher, MB]

What are the things that your investors are looking for?

[Robert Beamish]

We target investors who are looking for a social return as well as a financial return. They are socially conscious investors, so not all investors in this market are our target market. We are looking for investors who want to receive more than an ROI, and who want to have social development included in their investment portfolio, which they are actively tracking. Those are the types of investors that we look for and build relationships with.

[Ted Falk, Conservative, Provencher, MB]

Thank you.

I think I'm out of time.

[The Vice-Chair, Conservative, Shannon Stubbs]

You are. Thank you.

Everyone's so cooperative.

Now it's back to David for five minutes.

[David Graham, Liberal, Laurentides—Labelle, QC]

Mr. Insley, I want to come back to a question from your opening comments. You talked about the rapid and phenomenal growth of the Maori-based economy in New Zealand. I'd like to learn more about the root causes of that. Where is success? What was the turning point? What lessons can we take from that, more widely?

[Chris Karamea Insley]

I think that's a great question.

It's in two parts.

Why is it that the Maori economy is achieving these phenomenal growth rates? First, we have to acknowledge that the treaty settlement process has, if you like, created a pool of development capital available to Maori people that is now being reinvested back into the development of our own businesses, which we own completely. We own fishing companies. We own forestry companies. I was on the board of a highly successful energy company—geothermal energy—and that was stimulated by that initial settlement redress. We've had that pool of development capital made available through that process, but it's not only that.

We have some very talented and smart Maori companies today that are active in a whole range of different fields and have become highly vertically integrated, from the raw material right through to the end product that's being marketed around the world and promoted as being developed by this Maori community.

That all came about through my previous point about growing our young people with the best talent, to bring them back in with all of that talent that they have. It's those two things combined, and there's a third thing I should add, too.

The third thing—actually, there's a fourth thing—is to take a long-term view so that your planning horizon is long. It's not like what we've seen in the past with business per se, where the planning horizon was typically five years. Maori businesses can plan for 100 years. You ride out the ups and downs of prices and all of that kind of volatility.

The last point I'd make that contributes to that phenomenal growth rate is what's inherent within indigenous people, in my view, but certainly within Maori communities, to actually collaborate together and create scale. When you create scale, as you will know, sir, you create leverage. You create leverage in all sorts of ways.

It's a combination of those four factors that are driving these very real, very high, compound annual growth rates.

[David Graham, Liberal, Laurentides—Labelle, QC]

Is the Maori economy leaps and bounds ahead of the non-Maori economy of New Zealand, or is it catching up at a very high rate of speed?

[Chris Karamea Insley]

We're still very far behind in terms of absolute numbers, but the point is the compound annual growth rate, and this is certainly what our governments are paying attention to. There are ministers of our government now who are saying that the Maori economy has become the cornerstone of the New Zealand economy because of its growth rate.

[Raylene Whitford]

I think that growth rate is 20% to 30% versus 2% to 3% nationally here.

[Chris Karamea Insley]

Yes.

[David Graham, Liberal, Laurentides—Labelle, QC]

Without the Maori growth, the national economy would not be growing? Is that what I understand?

[Chris Karamea Insley]

That's right. There are really very good reasons, in my view—and certainly it's happening in our country—to pay attention to the interests of the indigenous communities.

[David Graham, Liberal, Laurentides—Labelle, QC]

Could you give a sense of at what point the attitude changed, if it did, to make this happen? Can we identify a moment that this started happening? Was there some change in policy or culture?

[Chris Karamea Insley]

There's no one absolute point. I've been asked that question several times in the last few days and weeks. Was there a critical turning point? It's hard to put a finger on it. It happened some time in the last 20 to 30 years, and it was an accumulation of effort and events, but not a single one of these.

If I were to pin something down, sir, I'd bring it all back to education by Maori people of young people.

[David Graham, Liberal, Laurentides—Labelle, QC]

My time is up. Thank you very much.

[The Vice-Chair, Conservative, Shannon Stubbs]

Now we'll go to Ted for five minutes.

[Ted Falk, Conservative, Provencher, MB]

Thank you. I get to ask more questions.

You talked about a redress that you had for Maori people as providing some seed capital and funding that allowed them to initially become entrepreneurs, if you want to use that term. Was there anything else that contributed to the success that they are enjoying today?

[Chris Karamea Insley]

Ted, again, thank you for the question.

I make the point that the development capital that became available through the treaty process was a hugely important catalyst. Beyond that, I think it's education. I don't want to keep belabouring it, but it is education.

You make the point about Maori people becoming entrepreneurial. We actually have that entrepreneurialism; it's really been part of our DNA for many years. Prior to the wars that we've had in New Zealand, we did have a thriving Maori economy—this is over 100 years ago. Different communities had their own currencies. Different communities back then were trading internationally with shipping companies through the last 100 years or so. My point really is that it has been a part of the DNA of the Maori to trade with each other and internationally.