Category: Whai Rawa | Economy

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Māori Agribusiness Research: What we now know

As more land is returned to iwi through Treaty settlements, Māori land entities are exploring how to provide for their people while upholding principles such as kaitiakitanga (values of guardianship and mutual responsibility). 

Many Māori land trusts and incorporations are recognised innovators in the agribusiness sector. There is also considerable scope for improvement, with some estimates putting the potential for adding value by highlighting cultural attributes as $8 billion over 10 years.

The Māori agricultural sector is therefore crucial to the development of future agribusiness solutions that are productive economically, while also restoring the wellbeing of the land and water resources underpinning agriculture for future generations.

Māori agribusinesses experience unique opportunities and limitations as a result of competing market, legislative, cultural and social factors. 

Here’s what we now know:

Learning 1: Key principles and domains

Four key principles constrain and shape actions of Māori land trusts and incorporations:

  1. Whai rawa – the principle of financial profitability
  2. Kaitiakitanga – the principle of protecting the environment
  3. Mana whakahaere – the principle of leading well
  4. Whanaungatanga – the principle of caring for the community

Five key domains determine their success or failure:

  1. Financial capacity – the ability to access working capital
  2. Skills and knowledge – governance and operations
  3. Relationships and trust – social capital and networks
  4. Paths to market – market access and branding
  5. Regulatory environment – legislation

Learning 2: Māori values pay off

When you apply Māori values and emphasise protection and restoration of the mauri and whenua using Māori values, the result is a more sustainable, profitable and productive farm. 

Conventional wisdom tells us too much focus on cultural values and environmental sustainability will diminish productivity. This research demonstrates otherwise; cultural values will enhance a farm’s ability to be productive, financially and environmentally sustainable. 

Learning 3: Rethink performance measures

So how do Māori farms manage to uphold cultural and environmental values while increasing productivity?

They naturally and deliberately incorporate Māori values into their decision-making and governance. 

Māori farms, whether they are managed by Māori, pakeha, sharemilkers or others, attempt to incorporate and emphasise those Māori values.

It’s a different kind of measure to what the performance of a farm looks like. Yes the financial, productive values are there but they’re also measuring the mauri of the whenua. Which is hard to quantify but it is how they express it.

Learning 4: Strong correlations among values, rather than trade-offs

Māori agribusiness value-drivers work in synergy.

Learning 5: Enablers and constraints on Māori agribusiness

Successful Māori agribusinesses focus on continual improvement, product quality, and future vertical integration.

Leading Māori land incorporations and trusts (MALITs) are diversifying beyond standard farming practices (such as sheep, beef and dairy) into honey, tourism, hemp, organic, goat and dairy sheep farming. .

While top-heavy governance and use of consultants was noted as a flaw in the literature, most successful agribusinesses learned to make the most of these apparent flaws and, in some cases, turn them into advantages.

One of the “big myths of governance”, according to one MALIT* “is you actually need to understand where you need to have advice.” 

They successfully engage with a farm consultant “…to paper over the cracks of lack of expertise around the board table” and “get some science behind some of the things that we’re doing.”

Another participant, talking about both consultants and metrics, outlined that because of the issues that the board’s had over the last five to eight years [the consultant was] brought in to be a lot more than just a technical advisor, [now he] just runs numbers, really looking at what can drive our performance and then how we make our environmental plan work… how we utilise surpluses and how we fill deficits from a cash point of view.

However, the vast majority of Māori agribusinesses face constrained opportunities to access premium markets, remaining dependent on their supply chains to communicate their credentials to market and access premiums.

As a result of this research, an online tool to measure enablers and constraints on Māori agribusinesses has been developed. 

The Kohuratia website provides Māori agribusiness in Aotearoa – or anyone interested in moving toward an agribusiness driven by Māori values – with a snapshot of the current constraints their operations are faced with, and identifies the most impactful actions an organisation can make.

Learning 5: Open up the conversation

These findings can support all farmers of Aotearoa New Zealand. Whether Māori or non-Māori, the broader farming community could benefit from having conversations with their Māori farmer neighbours. 

Snapshot of Maori agribusiness

50%

surveyed were actively seeking access to premium markets. 

94%

supply straight to a processor, rather than processing and distributing to customers themselves

5%

outline that they are actively engaged in the supply chain to connect with their customers. This is presumably the 5% of agribusinesses surveyed supplying directly to consumers.

50%

make efforts to create products demanded by premium markets.

45%

are adopting integrative farming approaches (i.e. mixed/mosaic land uses) to improve environmental performance, spread risk, and in turn elevate their sustainability credentials to meet both market expectations and kaitiaki (environmental) stewardship values. 

36%

are using industry benchmarking and key performance indicators (KPIs) to improve their market environmental credentials to meet increasing consumer demand for these attributes. 

9%

belong to quality assurance schemes, which are designed to provide international market assurance concerning the environmental and social credentials of product.

18%

are working on their own unique brand and story to communicate their values to markets

9%

are actively working on initiatives to target niche premium markets. 

25%

constrained by lack of processors to take and market premium products. This is the largest barrier. 

18%

attributed problems with making decisions inside their organisations as a constraint to taking clear actions to engage in premium value chains. 

25%

have trouble accessing the skills, capabilities, knowledge, networks, and financial capital to develop premium products that represent their values.

Toitu te Whenua, Toitu te Koira, Toitu te Tikanga – Whenua, Life, Values! Whenua Life, Values
Is a research project funded by Our Land and Water – Toitū te Whenua, Toiora te Wai, and completed in 2019.

Authors: Matthew Rout (University of Canterbury), John Reid (University of Canterbury), Jason Mika (Massey University), Anne-Marie Gillies (Ngā Pae o te Māramatanga, Te Puna Ora o Mataatua, Te Rūnanga o Ngai Tahu), Diane Ruwhiu (University of Otago) and Shaun Awatere (Manaaki Whenua Landcare Research).

The aim of the research was to understand the constraints and opportunities Māori agribusinesses experience and to develop a tool for Māori agribusiness to best manage competing demands and opportunities, including tensions between economic and cultural values in business.

Learn more.

Notes

*From the article, Māori agribusinesses: the whakapapa network for success. Jason Mika, Matthew Rout and John Reid

Click on the image for a printable version of this summary.

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Te Ao Māori News: Economics lecturer says lack of people movement will hurt economy

Massey University economics and finance senior lecturer Matthew Roskruge of Te Ati Awa and Ngāti Tama says if New Zealand’s borders aren’t opened to trading partners soon, this will have a long term effect on industry.

He also asks without a free-flowing market, what the economic impact would be on New Zealand’s economy if the borders aren’t opened to trading partners and how long before New Zealand will see those impacts?

“It’s the movement in people, that’s the real problem. In the short run that’s really hurting tourism of course but the move to domestic tourism has some interesting positives. It may be quite good for Northland perhaps. Instead of going to the Cooks or going to Hawaii for holiday they go to Northland. But that small silver lining is on a big dark cloud, which is that lack of movement of people.”

Roskruge says if movement of people is still limited by 2022 or late 2021 it will really start to impact the way New Zealand conduct business.

See the full story on Maori TV

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Taranaki Daily News: The biggest spend up since Think Big is coming to Taranaki

The community at Parihaka have a reason to celebrate. They have been given $14m to build a visitors centre that will give them the opportunity to tell their stories their way.

It will also provide a place and the staff to deal with the high numbers of visitors who amble down the drive to the historic South Taranaki community, expecting to see something, talk to someone and take pictures.

…

The different funds and the money being thrown around will bring back memories for some, of the Think Big projects in the late 1970s /early 80s.

Set up by Prime Minister Rob Muldoon the Government borrowed to fund large-scale industrial projects, such as the gas to gasoline plant at Motunui and the ammonia-urea plant at Kapuni.

The end result wasn’t pretty with New Zealand ending up deep in debt.

But Massey University School of Business senior lecturer Dr Matthew Roskruge doesn’t think there will be a problem this time around.

Both the level of science and understanding of economics and business has increased since then, he says.

‘’And our levels of debt are unlikely to hit any long run problems.”

New Zealand has an ‘’incredible’’ low level of debt to GDP ratio. And with the sort of debt so far in the Covid-19 recovery there is no risk of New Zealand ending up as a country with a high or even moderate level of debt.

‘’We have a lot of scope to borrow. New Zealand could be far more adventurous in taking on debt and our infrastructure is in really bad shape – water across New Zealand is in bad shape, some of our roads, our hospital systems,” he says.

“We need to be borrowing and investing in infrastructure. If infrastructure fails we don’t have any economy.’’

There is a concern that most of that borrowing will have to be paid back by the next generation.

‘’But both with Covid and the state of infrastructure in New Zealand, and with the incredibly low cost of borrowing, it absolutely makes sense for New Zealand to be doing this.’’

Read the full article on Stuff

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Māori TV: Māori tourism critical to country’s economic rebuild

On Monday Stats NZ revealed 234 Māori tourism businesses had employed 11,100 people in 2019 but, as the country suffered a massive financial blow due to Covid-19, this now highlights jobs at risk.

But Māori economist Matt Roskruge says if Covid-19 is taken out of the picture, ” we’re seeing amazing growth in Māori tourism and it’s across the board,” “We should be very proud,” Roskruge told Tapatahi.

See the full interview on Māori Television’s Taitahi

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Stuff: Māori economy critical to Covid-19 economic recovery

Dr Matt Roskruge. Photo by Waikato Times

OPINION: Covid-19 has resulted in serious human and economic harm, bringing hardship to millions globally and devastating economies across the globe.

However, there is opportunity in every economic crisis, and our current one enables us to realise economic renewal and reprioritisation by breaking up the economic status quo.

This opportunity can be squandered through lack of ambition, vision or action.

To capture the benefits, conversations will have to be had about what this rebuild looks.

Read Matt’s full piece on Stuff

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Stuff: Deep Trouble: A historic unemployment crisis has begun

As the number of people out of work continues to grow, many households and communities will face problems they have not known before. For some, it will make an already difficult existence even harder.

A three-part Stuff investigation details the shape of the crisis now, how it will grow and what it means for a welfare system suddenly under intense scrutiny.

Te Au Rangahau co-director Matt Roskruge features in Part Two: Who’s next? and Part Three: Unemployment and racial privilege

…Māori economist Matt Roskruge says institutional racism will almost certainly rear its head as the redundancies pile up.

Quite often Māori staff are the first to be let go for whatever reason, he says. They’re disproportionately in more precarious work, have fewer fixed hours, and work in sectors that have been disproportionately impacted.

Māori also often have barriers to opportunities, such as fewer resources, more family commitments and less ability to travel for work.

…Roskruge, meanwhile, reckons some iwi are well-positioned to invest in high growth opportunities that are currently going cheap.

“Māori companies tend to carry less debt. So there are some opportunities for the Māori economy to pick up some bargains, diversify and be well-positioned for when things inevitably get better.”

He says in the tech industry giant firms such as Google, Facebook and others are picking up a lot of cheap technology companies.

“For Covid-19, you’re really looking for pre-existing wealth or where there is capacity to borrow. There’s bargains to be had and some iwi are in excellent positions to take advantage of those bargains.”

While some iwi are in a strong financial position, Māori as a population are not.

Many iwi and social service organisations, like the Otangarei Trust, led the welfare response in their communities during lockdown and will continue to as the recession deepens.

The cruel thing about economic shocks, Roskruge says, is those who have got cash can use it to make more. People who find themselves in a more precarious position, on the other hand, become worse off.

“It tends to be quite cruel in these recessions. The recovery rewards people with resources to invest in the recovery.”

Both Reid and Roskruge agree it’s time for a change of perspective on the unemployed…

From Part Three:

…Reid says the inequities that currently exist are being magnified by the income relief payment.

It’s a wake up call to policy makers in Government to be mindful of institutional racism, he says. “Unless you’re vigilant you can easily make policy decisions that support the dominant culture in society.”

Māori economist Matt Roskruge agrees.

“It’s getting close to systematic racism. It’s knocking on the door of being blindly manufactured to disadvantage Māori disproportionately,” Roskruge says.

“Nobody has sat down and gone: ‘Well, who is this going to benefit and who is this going to hurt?’”

He says the Government probably didn’t give any thought to the possibility the payment was discriminatory.

Roskruge argues Covid-19 created a sharp shock to the economy but global markets were already starting to soften in September last year, which was having an impact on Kiwi jobs before the pandemic hit. He doesn’t think it’s fair Māori and other vulnerable workers who have lost their jobs since September are being disadvantaged.

“By introducing it to only new people who are about to enter onto the benefit you’ve systematically excluded a disproportionate number of Māori, who have already entered into Jobseeker, from accessing the higher fund.”

Policy-makers perhaps believe people who lived on Jobseeker support prior to March had already adjusted to a lowly beneficiary income, Roskruge suggests. The newly unemployed, on the other hand, would be used to a higher income so need the extra cash to adjust…

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