COURSE: INDIGENOUS MANAGEMENT Hi! Please make sure that the case study questions are answered keeping the history and culture of Indigenous people of Canada in perspective. The course's name is Indige
CASE STUDY:
Corporate Agricultural Investment in First Nation Reserves in Canada: The Case of One Earth Farms
ABSTRACT
David C. Natcher and Tom Allen
DEPARTMENT OF AGRICULTURE AND RESOURCE ECONOMICS, UNIVERSITY OF SASKATCHEWAN
In 2009, One Earth Farms (OEF) established farming operations on First Nation reserves in Saskatchewan and Alberta, Canada. The partnership that was created with First Nations was seen by some as a new model for Canadian agriculture; one that reduced agribusi- ness risk while enhancing the economic and social welfare of First Nation communities. Not- withstanding the purported social and economic advantages, by 2014, OEF discontinued its contracts with its First Nation partners. The failings of OEF have since been attributed to a flawed foundation, built on a culture and people with a sense of entitlement. Yet this research has found that conflicting timelines, the misalignment of goals, and failure to deliver on what was most important to First Nations are most attributable to the failing of OEF. In this paper we present important lessons learned that if considered can result in more informed and sustained partnerships between First Nations and the private agricultural sector.
INTRODUCTION
In 2009, One Earth Farms (OEF) established farming operations on First Nation reserves in Saskatchewan and Alberta. Starting with 4 employees, approximately 18,000 acres, and 1,558 head of cattle, OEF grew in only 4 years to having over 100 full and seasonal employ- ees, 103,002 acres of cultivated farmland, and was leasing over 115,881 acres of pasture to support a herd size of 17,557 head of cattle. This expansion was made possible through pri- vate investment of over $70 million, making OEF one of the largest corporate farming operations in Canada.
The basis for OEF’s initial growth rested in establishing partnerships with First Nations who served as landlords, business partners, equipment operators, and ranch support. Accord- ing to senior management of OEF, the partnership that was created with First Nations repre- sented a new model for Canadian agriculture; one that reduced risk through economies of
scale, while enhancing the economic and social welfare of First Nation communities. Not- withstanding the purported social and agri-business advantages, by 2014, OEF discontinued its contracts with its First Nation partners. Soon after, farm machinery was sold, First Nation employees were let go, and most of the reserve farmland that had been leased to OEF went back to being farmed by non-Aboriginal farmers.
The objective of this paper is to trace the development of OEF and identify the chal- lenges associated with corporate agricultural ventures on First Nation reserves. It is our hope that the results of this research will enhance public and private sector understanding of the factors that contributed to the failed OEF venture. By identifying some of the challenges of agricultural development on First Nation reserves, we hope that more effective policies can be developed that reduce agri-business risk, and create more private investment and sus- tained economic development for First Nations in Canada.
BACKGROUND
The literature on First Nation agriculture in Canada is limited. The few sources that do exist depict a history of exclusion where the attempts of First Nations to participate in the agricul- tural economy have been thwarted by Government policies. This history can be traced to the late 1800s when, following the eradication of buffalo from the northern plains, First Nations had little choice but to adjust their way of life and adopt livelihoods suitable for changing times. With few other options available, First Nation leaders viewed agriculture as a viable strategy for the survival of their people; a population that was being ravaged by disease, starvation, and a general assault on their cultures and economies (Daschuk, 2013). The Canadian Government also considered agriculture a remedy for the conditions inflicted upon First Nations. In particular, Hayter Reed, Deputy Superintendent General of Indian Affairs (1893–1897), believed that agriculture was the great panacea for the ills of Canada’s Aborig- inal populations. Believing that agriculture could help reverse the conditions plaguing the First Nations of western Canada, the historic treaties included provisions that would facili- tate First Nation entry into the agricultural economy. Some of those provisions, known gen- erally as the cows and ploughs provisions, included the issuing of farm equipment, including two hoes, one spade, and one scythe to each First Nation family, and one plough for every 10 First Nation families. First Nation Governments were also provided one bull, four cows, and an annual supply of seed for the benefit of all members (Buckley, 1992, p. 35). Even with this minimal level of support, First Nation farmers proved successful at adapting to their new vocations in agriculture, and by the turn of the century, many were out producing their non-Aboriginal neighbours. Tang (2003) has noted that the success of First Nations in agriculture could in large part be attributed to their collective use of land, labour, and supplies.
The success of First Nation farmers did not go unnoticed, and soon drew criticism from European settlers who had been enticed west by the Canadian Government with the promise of land and wealth. Believing that First Nations were benefiting unfairly from their collec- tive supply of land and labour, settlers petitioned the Federal Government for change. Under political pressure, the Canadian Government set out to undermine its own assimilationist policies by introducing a number of measures that would effectively exclude First Nation involvement in agriculture. The first of these policies is known as Severalty Policy, which divided reserve farmland into 40-acre plots. Under the Severalty Policy no First Nation
farmer was permitted to hold more that 40-acres, and First Nation families were limited to no more than 160 acres. This policy was motivated by Government’s desire to breakup the collective land base of First Nations and instil a sense of individualism within First Nation economic affairs. The Severalty policy was also used to determine the amount of ‘excess’ land that could be surrendered to Government and made available for sale to European settlers. This policy, in effect, resulted in the loss of thousands of acres of First Nation reserve land.
Accompanying the Severalty Policy was the introduction of more sweeping legislation that became known as the Peasant Farming Policies (1889). Premised on the belief that First Nations should first learn basic agricultural skills, only the most rudimentary farming tech- nologies were permitted. In combination with the Severalty Policy, which reduced the acres available to First Nation farmers, Peasant Farm Policies guaranteed that farming on First Nation reserves would function at no more than a subsistence level. To further ensure First Nations were excluded from commercial agricultural opportunities, the Canadian Govern- ment introduced a Permit System which required First Nation farmers to first acquire approvals from a Government representative (e.g., Indian Agent) before they could legally sell their products in the market. Together these policies removed any opportunity for First Nation farmers to participate in the agricultural economy in western Canada. By the early 1900s, settler farmers enjoyed a virtual monopoly over agricultural markets in western Can- ada (Bateman, 1996, p. 220). Today, the exclusionary tactics of Government are reflected in the gap that exists between First Nations and non-First Nations farmers. For example, Champ, Bitner and Nicholat (2010) found that of the approximately 37,000 farms in Sas- katchewan, less than 1% (< 500) are owned and operated by First Nations. Of the 4 million acres of agricultural land owned by First Nations in Saskatchewan, over 80% (3.2 million) is leased to, and farmed by, non-First Nations farmers (Champ et al., 2010). Contributing fur- ther to the exclusion of First Nations from agriculture are the changes occurring in the agri- cultural sector as a whole, as farm exits increase and farm size and corporate farm ownership expands (Olfert & Natcher, 2016). These changes have made it even more difficult for First Nations to gain entry into the agricultural sector and develop successful commercial operations.
It is against this historical backdrop that One Earth Farms (OEF) emerged. The origin of OEF can be traced to Kevin Bambrough, then president and CEO of Sprott Resource Cor- poration (SRC), who travelled to Saskatchewan to explore opportunities for oil and gas development on First Nation reserves (Sorenson, 2010).Through his discussions with First Nation leadership, Bambrough learned that much of the reserve lands of First Nations was either underutilized for agricultural purposes or was being leased to non-First Nation farm- ers. To Bambrough this seemed like an obvious business opportunity. If SRC could gain entry into the agricultural sector via First Nation reserves, lands that are federally regulated under the Indian Act, SRC could circumvent provincial landownership restrictions prohibit- ing publicly traded companies from establishing farming operations in prairie provinces (Somerville & Magnan, 2015). If this could be accomplished, SRC could not only capture a significant portion of the agricultural industry in western Canada but they could also help to reduce the disparity that exists between First Nation land holdings and the negligible agri- cultural benefits they have historically enjoyed (Magnan, 2012).To attract First Nation part- ners, SRC committed an initial financial investment of $27.5 million to secure long-term leases. Leases ranged from 5 to 10 years at fair market value. This arrangement differed con- siderably from the experience of many First Nations who often lease their lands on an annual basis, below market value, and under buckshee arrangements, which carries consider- able risk for all involved. Buckshee leases are informal agreements entered into between a member of a First Nation or the First Nation itself and another party, where the lease is not formally approved of by the Federal Government, as is required by the Indian Act. Entering into formal and federally approved leases creates greater certainty for First Nations while ensuring competitive lease values for their lands. To further entice First Nations into leasing their reserve lands, SRC offered First Nations shares of equity stock in OEF and promised career and training opportunities for First Nation members. With these incentives, SRC was able to attract 13 First Nation partners who agreed to lease portions of their reserve lands to OEF. These First Nations included the Blood Tribe, Enoch First Nation, Saddle Lake First Nation, Sweetgrass First Nation, Kawacatoose First Nation, Muskowekwan First Nation, Little Black Bear First Nation, Fishing Lake First Nation, Yellow Quill First Nation, Star Blanket First Nation, Chacachas First Nation, Cote First Nation, and Keeseekoose First Nation (see Figure 1).
Those First Nations who agreed to partner with OEF saw this as a unique opportunity that would bring about economic and social benefits; a ‘cultural match’ that was considered necessary for community support. As noted by Dale Awasis, former Chief of the Thunderchild First Nation, the partnership with OEF will “bring the investment dollars for building agricultural capacity ... where eventually we will be able to manage and maintain our own lands.” Chief Awasis further noted that their partnership with OEF represented a prime opportunity to utilize Thunderchild’s 120,000 acres of reserve land for the band’s long term economic gain.” Clarence Bellegarde, former Chief of the Little Black Bear First Nation, highlighted the employment and training opportunities that would be made available to First Nation members, and the opportunity in the future to assume senior management positions in OEF (above quotes found in Lappano, 2009).
Aboriginal scholars, including Calvin Helin also weighed in, noting, “OEF gives Aboriginal people the opportunity to control their own destiny and their own resources in a way that is consistent with their own environmental and social values." Further support was offered by Clint Davis, President and CEO of the Canadian Council of Aboriginal Business (CCAB), who saw OEF as an opportunity for “First Nations people [to] utilize their own land as a significant asset for economic benefit in a sustainable and responsible way. The fact that Aboriginal people are equity owners and are integrated in the operation is significant." Adding additional credibility to OEF was the appointment of Phil Fontaine, former Grand Chief of the Assembly of First Nations, to the OEF Board of Directors. Fontaine expressed his excitement “to be part of a unique and transformative company that will help move First Nations directly into the farming industry and create new training, employment and business opportunities" (above quotes found in Lappano, 2009). With these endorsements, the March 2009 announcement of OEF was met with considerable media interest, as reported in Canada’s Globe and Mail: “Bay Street investors and a group of Chiefs from Saskatchewan and Alberta formally announced the unlikeliest of marriages, one that would make them the most influential farmers in all of Canada, with a super-sized one-million-acre operation that could rival the largest corporate farms in the world (Friesen, 2009).
METHODOLOGY
In order to trace the development of OEF and identify the challenges associated with corporate agricultural ventures on First Nation reserves, a multi-method approach was adopted. Interviews were conducted with senior managers from OEF (3), OEF employees (5) and First Nation leaders (5). These semi-structured interviews explored the challenges that OEF encountered in developing farming operations on First Nation reserves, the difficulties in meeting the needs and expectations of both investors and First Nation members, and any recommendations that may be used to inform future agricultural devel- opment on First Nation reserves. In addition to interviews, annual and quarterly reports from OEF were reviewed, as were public press releases and popular news sources. These reports were used to trace annual investments, financial losses, the expansion and contrac- tion of acres under production between 2009–2014, and public statements made by OEF senior managers.
RESULTS
In its first year of operation (2009) OEF set a goal of seeding 50,000 acres. However, by August of 2009 OEF had only seeded 12,000 acres on three First Nations reserves in Sas- katchewan (SRC, 2009). Although this was fewer acres than intended, it was not surprising given that the initial capitalization and the official launch of OEF occurred only four months prior. By comparison OEF still managed to seed a land base larger than most other Saskatch- ewan family farms. With this relative success, and with optimism high, OEF announced in September 2009 that it planned to lease an additional 100,000 acres, making OEF “... the largest corporate farm in Canada, and among the largest in the world, giving First Nations a definitive role in the management of some large swaths of arable land (SRC, 2009).” The expansion of OEF was made possible through an additional investment of $15 million, including $3 million from the CAPE Fund. The CAPE Fund was established by former Canadian Prime Minister Paul Martin, who noted that “This transaction ... will support a unique model for Aboriginal business, allowing First Nations to participate actively and with a strong degree of influence in helping to build a successful, world-class enterprise” (Cape Fund, 2010).Other investors included Alliance Grain Traders, the world’s largest lentil and pea-splitting company (OEF Website — News, January 22, 2010), and Ag Growth Interna- tional Inc. (AGI) that purchased $2 million in OEF common shares and secured grain supply handling, storage and conditioning services for OEF operations (AGI, 2009).
In the spring of 2010 OEF started its first full year of farming operations on First Nation reserves, including the Blood reserve in southern Alberta and the Muskowekwan, Little Black Bear, and Star Blanket reserves in Saskatchewan. These operations included 35,100 acres of cropland (8,554 that were custom farmed), 23,730 acres of pasture, and 1,900 head of cattle (SRC, 2011a). To support these operations, OEF grew from 4 to more than 80 employees, 32 (40%) of who were First Nation members.
Despite its rapid growth, OEF failed to show a profit following the 2010 season, citing high start-up and overhead costs, coupled with an exceptionally rainy planting season that resulted in only 60 per cent of OEF’s farmland being seeded. Notwithstanding its failure to turn a profit, in December 2010, SRC announced that it would be investing an additional $30 million into OEF. This investment was based on the corporate belief that OEF was “an exceptionally unique, scalable agribusiness that will command a high valuation” in the future (SRC, 2010).
By the spring of 2011, OEF announced that it would again be leasing approximately 100,000 acres of cropland and an additional 50,000 acres of pasture to support a herd size of 13,000 head of cattle. This expansion was made possible in part through the leasing of a turn-key farming operation in central Alberta, which consisted of 31,000 acres of farmland, along with $10.2 million of selected farm equipment, a building machine shop, and two grain storage elevators with a total capacity of 400,000 bushels (SRC, 2011c). In addition to this investment, OEF finalized its agreement with the Blood Nation in southern Alberta, which involved the leasing of more than 50,000 acres of reserve croplands. The significance of this partnership was ceremonially recognized with the bestowing of an Honorary Chief- tainship and gifting of a traditional Chief’s headdress to Kevin Bambrough. According to Charles Weaselhead, then Chief of the Blood Nation, the significance of this honour is based on “Kevin Bambrough’s sincere efforts to engage Canada’s First Nations peoples in pursu- ing genuine partnerships in agriculture, which have created increased employment, revenues for First Nations, and the environmental sustainability of our lands” (Chief Charles Weaselhead, in SRC, 2011b). This expansion marked a significant accomplishment in securing large tracts of First Nation land, and also indicated to some that OEF was nearing the turning point where it could achieve the margins necessary to cover its start-up and opera- tion costs. Despite strong support from the First Nations, combined with a growth in acres and livestock numbers, OEF recorded net losses of $11.1 million in 2010 and $14.0 million by year end 2011 (SRC, 2012). While lower-than-planned crop yields, and hence profits, can be attributed to inclement weather, the acquisition and integration of new land and labour also created challenges. In many cases reserve farmland required improvement before opti- mal yields could be attained. In other cases First Nation reserves required surveying and des- ignation of boundaries. This included the determination of the legal land locations of First Nation reserves, which required additional time to ensure that operations were actually occurring on land that belonged to the First Nations. New labour also meant that production took longer than anticipated and sometimes challenged the efficiency of the operation. For example, OEF employed real-time information gathering technologies. OEF farm managers relied on iPads to give directions to equipment operators, and equipment operators used iPads to track operations and locate fields. In many cases new employees lacked adequate training and were unfamiliar with these technologies. Further, unlike family farming opera- tions, where generations of land-based experience have been accrued, many OEF equipment operators were employed on reserves other than their own and were unfamiliar with the areas in which they were working.
By 2012, OEF’s corporate strategy began to promote operational efficiency over expan- sion, and a commitment to moderate growth. Moderate growth was the new mantra for a company that had grown so rapidly in its first three years. While the million-acre mark was still a long-term target, it was no longer considered achievable in the near-term. Moderate growth also involved a reduction in operation costs and efficiencies in its value chain. In its move towards streamlining its value chain, OEF began to explore opportunities to develop premium-branded products from its crop and cattle operations (SRC, 2012).In 2013,OEF acquired Toronto based Beretta Farms, a purveyor of hormone free and antibiotic free natu- ral and organic branded meat products in Ontario and British Columbia (SRC, 2013a). This move represented OEF’s first step towards vertical integration and entry into branded food products. With the purchase of Beretta Farms, SRC’s relinquished 46% its ownership in OEF (SRC, 2013b). In addition, Mike Beretta, who at that time was the CEO of Beretta Farms, was appointed President and CEO of OEF. Soon after the acquisition of Beretta Farms, the on-line corporate description of OEF was changed to read: “OEF operates a series of cattle and grain/oil-seed farms across the prairie provinces of Canada to support the OEF’s goal of ensuring absolute food traceability from the farm to the consumer’s fork (OEF Corporate Website, 2013).” This corporate description reflected OEF reorientation towards branded cattle products and is the first time that OEF fails to mention its partnership with First Nations. Later that year (2013) OEF acquired Toronto-based Sweetpea Baby Food Ltd. marking a continued shift from primary production to the value-added sector in order to improve shareholder returns. Amidst these changes, the Blood Nation informed OEF that they would no longer be leasing 50,000 acres of reserve lands. With the loss of these acres, OEF’s Lethbridge, Alberta field office was closed and the staff and Farm Manager were terminated.
Changes at OEF carried over into 2014 with the departure of Kevin Bambrough from SRC. Bambrough’s departure signalled OEF’s continued restructuring, which involved the scaling back of its crop farming operations and a more concerted focus on vertical integra- tion of its cattle and branded food divisions, which according to OEF’s new management, better aligned with the company’s long-term growth strategy" (SRC, 2013b). Later that year OEF announced that it would be exiting its crop farming operations and all proceeds from the sale of property, plant and equipment related to crop operations would be used to expand its branded food business. By May 2014 OEF had sold its machinery and terminated leases for thousands of acres of First Nation reserves across western Canada. In just over 4 years, OEF lost an estimated $70 million dollars and went from leasing over 103,000 acres of cropland in 2011, to zero acres in 2014.
In a series of interviews, Mike Beretta explained “Crop production just didn’t seem to fit in with our strategy going forward. And to be honest, we [OEF] didn’t show any ability to generate anything remotely resembling profitable numbers. I never bought into [the idea] ... on a corporate scale, that it would work” (in Cross, 2014). In a later interview with The Western Producer (Pratt, 2014) Beretta further explained that the problem with OEF was that is was built on “... a flawed foundation. If you don’t have the right culture and people, things can go awry. I’m very big on culture and people and relationships and partnerships, and the way One Earth had created it, it was strictly an employee-based scenario and there was little tied to performance. A sense of entitlement permeated the business, which doesn’t work well for a company that was operating on a scale of One Earth Farms. It’s like pouring gas on a fire” (in Pratt, 2014). Today there is virtually no trace of First Nations ever being involved with OEF.
DISCUSSION
While the failure of OEF has been attributed to a flawed foundation, built on a culture and people with a sense of entitlement, other factors are perhaps more deserving of attention. First it is important to recognize that SRC is a venture capital firm. As a venture capital firm, SRC provides early-stage financing to start-up companies and then realizes a return at the time of a sale or a public offering of shares. This type of investment strategy has a rela- tively short timeline, where five years would be considered at the upper range of direct par- ticipation. At the time of its second round of investment (2010), SRC was already touting the prospect for OEF to command a high valuation as Canada’s largest operating crop and cattle farm. However, by 2013, four years after its start-up, OEF had yet to show any sign that it would be profitable to a third party. Undoubtedly the inclement weather in 2009 and 2010 presented a challenge to meeting its expected margins, but the mounting financial losses emanating from farming operations were an indication that it never managed to achieve the desired plateau even within a favourable economic climate. In fact, OEF’s finan- cial losses continued to mount even during 2011–2013 when most of Western Canada was enjoying high crop yields and record high prices. While OEF’s relationship with First Nations was a considerable advantage in accessing reserve land holdings, it also positioned OEF differently from other farmland investment funds whose investors were benefiting from rising agricultural land value. Increasing land values are welcomed by landowners, but for OEF this meant additional operational costs. For SRC and its investors, the ultimate profit would be determined at OEFs exit from the venture and the value investors placed on the company’s secure access to reserve farmland.
Those First Nations who partnered with OEF were certainly aware of SRC’s objectives, and accepted that there would be a transfer of ownership. However, according to First Nation leaders, they were promised that they would become shareholders in OEF through the distribution of equity shares and potentially could secure sole ownership of OEF farm operations. Although the Saskatchewan Securities Commission approved their equity stake in OEF in 2010, equity distribution to First Nations never occurred.
From the outset the success of OEF was measured in acres, specifically the number of additional acres that could be added to the rental portfolio each year. The pressure on OEF to grow was motivated by a number of factors, most notably the ability to market OEF to investors and for raising additional capital. Because of this, land acquisition was opportunis- tic. First Nations own a significant amount of high quality farmland. However, the vast majority of quality farmland is either farmed by First Nation members, or under rental agreements to local producers who have established positive long-term relationships with First Nations. Several First Nation Chiefs stated that they would consider making their best lands available if OEF was able to demonstrate success over the long-term, but were unwill- ing to relinquish their best lands or jeopardize the positive relationships with other tenants for an untested venture. Due to this reluctance, SRC was forced to offer above market lease rates, even for lands with very marginal agricultural value. These contracts were then inher- ited by OEF who were then challenged to recoup those initial inflated investments.
The rapid growth of OEF also required a large number of labour positions to be filled. While efforts were made to ensure that the best people were hired, the economic climate of western Canada created a number of human resource challenges. Due to the strength of the resource sector in Saskatchewan during this period, many of the best workers were not avail- able to OEF, while those who were available required training and skills development before they could be fully utilized. This required time. Several First Nation members who were offered positions with OEF chose to wait to see how OEF performed before they were will- ing to leave high paying, full-time, and more or less stable positions. In Saskatchewan and Alberta, OEF was competing with oil and gas wages for good workers. The agriculture sec- tor does not have the margins to compete with that industry in terms of wages and career opportunities. As a result OEF’s employment goal of 250 First Nation jobs was missed by more than 200 positions.
As their partnership evolved, and OEF continued to produce negative financial returns, First Nations were being increasingly relegated to the role of landlords and not business partners. By 2013 OEF was merely operating on First Nation leases with increasingly dissat- isfied ‘landlords’. As one former Chief stated: “The intent with OEF was to have some of the Chiefs at the decision making tables — that never happened, so they [OEF] started mak- ing decisions that were communicated to the Nations once they were decided. We started to feel like “who are you to tell us how things will work on our land?”
It would be misleading to suggest that OEF was a failure for First Nations. Although not what was originally envisioned, First Nations did benefit in some ways from their involvement with OEF. For example, prior to partnering with OEF, several First Nations lacked information on the rental status, soil classifications, and even the boundaries of their reserve land base. Through their partnership with OEF, reserve lands were surveyed, and legal land locations, farmable acres, and other details were recorded. These data were mapped and are now being used by First Nations to make more informed decisions concern- ing on-reserve development. Four First Nations have used this information to establish their own band-operated farms. Each of these operations has significant land holdings and employ band members, some of whom were directly involved in the OEF venture. One of these First Nations has established a partnership with a local rancher, and acknowledged that they would likely never have considered such a partnership prior to their experience with OEF.
It is also important to note that despite the fact that OEF terminated their leases with First Nation partners, those leases were recorded and guaranteed by the Federal Department of Indigenous Affairs and Northern Development (DIAND). When the OEF leases were ter- minated the terms of those agreements were subsequently enforced by DIAND and all pay- ments and outstanding obligations were honoured by OEF. Had these leases been agreed to under buckshee arrangements, First Nations would have had no protection or recourse to secure outstanding payments.
Perhaps most importantly for all First Nations is the fact that OEF brought to light the below market lease rates that First Nations were receiving for their lands. In many cases this has resulted in the doubling of lease rates for First Nations. At the time of the writing of this paper, these rates are still in effect. Based on their experience with OEF, First Nations are able to apply a more accurate formula for calculating and charging fair market value for their lands.
CONCLUSION
For the past century First Nations in Canada have been drawn into agriculture with the promise of opportunity and economic inclusion. The historic treaties included specific provi- sions for the development of First Nation agricultural economies. These provisions included equipment, training, and support that would enable First Nation farmers to participate and compete in the agricultural economy of western Canada. However, soon after those provi- sions were made the Federal Government bowed to the influence of settler farmers who claimed First Nations were benefiting unfairly from the collective use of land and labour. In response the Federal Government introduced a series of crippling policies that effectively excluded First Nation involvement in agriculture, while providing optimum financial and political advantage to settler farmers. Such hypocrisy served to protect the incomes of settler farmers and removed any potential for First Nation competition (Natcher & Allen, 2011).
A century later OEF was created with a similar promise of integrating First Nations into the agricultural economy of western Canada. Through a unique combination of finan- cial investment, agri-business expertise, and an extensive reserve land base, OEF set out to address the disparity that has long existed between First Nation land holdings and the neg- ligible agricultural benefits they have historically enjoyed. To date, no other corporate farming venture in Canada has used the same combination of land, labour, and ownership structure. By fully integrating First Nations into the enterprise, OEF seemed committed to forging a genuine partnership and a new model for agricultural development in western Canada. Yet after 5 years, OEF failed to achieve the profit margins that were expected by investors and failed to deliver on the social and economic benefits promised to First Nation partners. Soon after the leases that were negotiated with First Nations were cancelled, farm equipment was sold, and First Nation employees let go. It would be easy to attribute the failing of OEF to the belief that the wrong culture and people were involved, and a sense of economic entitlement created a precarious foundation to build upon. However, one can point to conflicting timelines, the misalignment of goals, and fail- ure to deliver on what was most important to First Nations as responsible for the signifi- cant challenges, that in the end, could not be overcome. Even with the substantial financial backing of SRC, together with the political influence of a former Canadian Prime Minister and former Grand Chief of the Assembly of First Nations, OEF failed to delivery on the promises made to First Nations. Despite this set back, First Nations continue to seek out economic opportunities and secure their rightful place in the agricultural sector of western Canada. With the experience of OEF, First Nations are now more aware of the challenges of developing and sustaining corporate partnerships, and useful lessons have been learned. These lessons include the need to move more slowly, or as one First Nation leader said, “not so loud”. This necessarily involves a commitment to ‘slow growth’ with an emphasis on relationship building over acres gained or profit margins achieved. This is not to sug- gest that First Nations are not interested in expansion and growth, but rather those mea- sures of success must be built on a foundation of mutual respect and a shared commitment to the social and economic well-being of First Nation communities. The decision made by the Blood Nation to honour Kevin Bambrough with an Honorary Chieftainship and gifting him with a traditional Chief’s headdress was not a trivial gesture. Rather it was a sign of respect and gratitude for what they saw as a pledge to advance the betterment of the cul- ture and economy of the Blood Nation. It is this type of commitment that will be necessary for future corporate-First Nation ventures to succeed.
As Canada works to meet the food needs of growing global population, the demand for agricultural land will only intensify. First Nations, who control a significant portion of those lands, will once again be standing ready take advantage of such opportunities. It will be to the benefit of the corporate world to take note of the lessons learned from the OEF experi- ence, and be better prepared as new opportunities for First Nation partnerships present themselves in the future.
CASE STUDY QUESTIONS
Strategic Alignment:
How did One Earth Farms' vision align or clash with the values and aspirations of the First Nations?
Were there clear indicators that the strategy adopted by One Earth Farms was not congruent with the First Nations' expectations?
Cultural Sensitivity:
How might cultural differences have influenced the partnership's outcome?
What steps could One Earth Farms have taken to better understand and integrate First Nations' values and way of life into their business model?
Communication and Engagement:
How effective was the communication between One Earth Farms and the First Nations communities?
Were there specific instances where better communication could have prevented misunderstandings or conflicts?
Business Model and Economic Viability:
Was the business model of One Earth Farms economically viable given the realities of farming and the specific conditions of First Nations' lands?
How did external factors (like weather patterns, and commodity prices) impact the project, and were these adequately considered in the planning stages?
Stakeholder Involvement:
How involved were the First Nations communities in decision-making processes related to farming on their land?
Would a more participatory approach, involving community members in key decisions, have led to a different outcome?
Expectation Management:
Were there mismatched expectations between One Earth Farms and the First Nations communities from the outset?
How could these mismatches have been identified and addressed earlier?
Risk Management and Contingency Planning:
What risks were inherent in the One Earth Farms and First Nations collaboration?
Were contingency plans in place, and how effective were they when challenges arose?
Future Considerations:
Given the lessons learned from this case, how might future collaborations between corporations and Indigenous communities be structured for success?
Are there examples of successful collaborations that could serve as models?
Ethics and Corporate Social Responsibility:
How does this case highlight the ethical considerations corporations should have when working with Indigenous communities?
Could One Earth Farms have approached the project more strongly focused on free, prior and informed consent?
Feedback and Iteration:
Were there feedback mechanisms to continually assess and adjust the collaboration based on input from the First Nations communities?
How could iterative approaches or pilot projects have informed a more effective large-scale rollout?
