Taking control key to First Nations business success
Whitesand First Nation stands poised to begin operation of their own green power plant and in doing so establish local businesses that will provide green energy, long term, skilled employment positions and revenues for the community.
The green power will be generated from wood pellets produced from Whitesand’s own pellet mill that will operate along side of a commercial sawmill.
The projects are expected to create 60 permanent jobs in the community, and another 60 seasonal jobs doing the forestry work need to supply the pellet and sawmill.
While the future looks promising, the road to this point has been long and full of potholes, according to David Mackett and Craig Toset, who presented the Whitesand story at the Aboriginal Entrepreneurship Conference in Ottawa from Oct. 15-16.
Mackett and Toset described the unsuccessful early attempts back in 1992 when the large company that managed the forest around Lake Nipigon did not consider green energy to be in their interest. As a result, Whitesand’s dreams of green energy were blocked. Now with the forestry company gone and the management of the forest resources under the control of the First Nation, things have changed and the pieces are coming together.
Due to the fact that Whitesand now controls the management of its forest resources, the First Nation has access to the wood resources it needs for the operation of both the pellet plant and the sawmill.
The pellet plant will provide a renewable source of energy for the co-generation power plant, replace over one million litres of diesel fuel annually and provide electrical power for the residents of Whitesand and the nearby communities of Armstrong and Collins.
More work is underway. To ensure that local people have the skills needed to run the various operations in the new businesses, the community is arranging for its future workers to attend a special 56-week program at Confederation College in Thunder Bay. Funding for the training has been secured although this was one of the more arduous tasks, Hackett explained.
Hackett and Toset admit that they have not always seen eye to eye when they were helping develop the plans. Hackett emphasized the importance of respecting local culture, meeting the educational needs of young people, respecting the environment and providing for social well-being while creating economic development. But Toset is the “numbers guy” and points out that none of the developmental goals will be realized unless the businesses themselves are successful and can operate viably in the real world.
While some challenges remain, Hackett and Toset are confident that a balance is possible and Whitesand will soon have its new economic ventures underway with over 120 jobs and over $2 million in developmental revenues to support community programs and activities.
The need to have a solid business approach in setting up First Nations owned and operated businesses was echoed by many at the Aboriginal Entrepreneurship Conference.
In many examples across Canada, First Nations have managed that need by setting up economic development agencies that operated independently of chief and council. Ben Voss, who heads the private equity partnership under the Meadow Lake Tribal Council (MDLC) in Saskatchewan, explained that setting up an arms-length agency that was independent of local politics was key to business success for the tribal council.
MDLC, which brings together nine First Nations, had been operating business ventures for 25 years but in 2009 decided to form Resource Development (RDI) to “pursue business initiatives and improve the wealth of shareholder communities.” RDI now operates as a private equity fund, owns 10 companies including the largest sawmill in Saskatchewan, generates over $300 million in annual revenues, has 58 percent Aboriginal employment and provides annual dividends to its shareholder communities.
Voss explained that its arms length relationship with the tribal council has allowed RDI to work successfully with a range of business partners, attract private investors and operate according to modern business principles. At the same time the organization remains accountable to the First Nations, which are its shareholders.
“It’s sometimes like working for your dad, someone is always looking over your shoulder,” Voss said, adding that RDI and MLTC have been able to find the balance that makes things work.
Voss also noted that RDI has had the most success when it takes the lead on partnerships it forms with industry or other stakeholders.
Hackett and Toset echoed that sentiment in discussing the work Whitesand has underway.
Like RDI and MLTC, the members of Whitesand First Nation have found that the most significant economic development impacts flow through initiatives that they lead and control.
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