Reconciliation-focused investments could be coming

Prominent voices in the Indigenous business community are hopeful that reconciliation-focused investment products could soon be available for retail investors.

“Part of our desired future state [is] to bring forward an exchange-traded fund of PAR-certified companies,” said Paul Lacerte, managing partner with Raven Indigenous Capital Partners, which runs the Raven Indigenous Impact Capital Fund.

The PAR or Progressive Aboriginal Relations certification program, which is run by the Canadian Council for Aboriginal Business (CCAB), has certified more than 150 companies since it began in 2001. The PAR program verifies outcomes in the areas of leadership actions, employment, business development and community relationships.

Lacerte spoke during a panel discussion hosted by the Responsible Investment Association last week.

Panellist Tabatha Bull, president and CEO of CCAB, said she’s had encouraging conversations with representatives from TMX Group Inc., which submitted a PAR application to CCAB earlier this year.

“My dream is that we could see the PAR certification [status for] every organization on the stock exchange listing, and that as an investor I can know that [a] company has gone through [the PAR] process: they’ve been certified, they are doing good work,” Bull said. “[They] said that’s not going to be that hard.”

Bull added that there have been discussions about establishing reconciliation-focused and Indigenous-relations mutual funds.

In a written statement, a TMX Group spokesperson reiterated the company’s commitment to PAR. “While discussions of specific products are still in the preliminary stages, TMX’s commitment to this important work is long-term and we are excited to explore new ways to provide Indigenous businesses with efficient access to growth opportunities,” the spokesperson said.

The Raven Indigenous Impact Capital Fund in January raised $25 million from 38 investors across Canada and the United States. Lacerte said Indigenous businesses represent a huge untapped investment opportunity.

“It’s critical to shift the lens from one of benevolence to an asset lens — to recognize the incredible richness of Indigenous epistemology and worldview, and the underlying values that drive decision-making within Indigenous communities,” he said.

“Indigenous epistemology is really representative of the solution for so many of [today’s] social, environmental and economic challenges we’re facing as a society.”

Bull agreed, saying that Indigenous businesses and communities want to build ventures that last, be they their own projects or those executed with a partner.

“They’re in it for the long haul,” she said. “They are there to be with that project for the next 100 years.”

Bull gave an example from earlier this year, when a coalition of Mi’kmaq First Nations partnered with Premium Brands Holdings Corp. to purchase Clearwater Seafoods Inc. The Mi’kmaq now own 50% of Clearwater.

“The communities that are part of that project have no plans to exit. They actually want to become whole owners of Clearwater,” she said. “It’s a long-term strategy when you’re partnering with Indigenous communities, which for investors, is a really important piece of what you’re looking for.”

Truth and Reconciliation Call to Action 92 defined reconciliation for corporate Canada by asking it to adopt the United Nations Declaration on the Rights of Indigenous Peoples. Doing so would involve actions such as ensuring equitable job access for Indigenous peoples and educating staff on Indigenous rights.

Editor’s note: Advisor’s Edge was a media sponsor for the RIA event. Media coverage was not a condition of the sponsorship.

Melissa Shin

Melissa is the editorial director of Advisor.ca and leads Newcom Media Inc.’s group of financial publications. She has been with the team since 2011 and been recognized by PMAC and CFA Society Toronto for her reporting. Reach her at mshin@newcom.ca. You may also call or text 416-847-8038 to provide a confidential tip.