The Modern Treaty Era
We have just discussed land ownership and the revenues that can be earned through environmental services, tourism, and resource extraction. Other potential sources of own-source revenue (OSR) come from interest on trust funds and savings, leases, property taxes and fees, and business profits.
As you may have noticed in this pie chart from Chapter 16, own-source revenue contributes 36% of revenue for the average First Nation; most of this is from the oil and gas earnings accruing to a minority of First Nations.
As the diagram below indicates, Indigenous businesses are an important engine for the Indigenous economy and the overall economy, primarily because businesses can become a source of funds – to the Band or other government as taxpayers, to the public as donors and employers, and to themselves as they fund their own expansions. Additionally, the savings of businesses and their employees give banks new funds for lending.
Another critical feature of business is that it exists to recognize and meet current consumer needs, identifying them with a level of accuracy and detail not possible for government. In the course of their operations, businesses create goods and services which were not previously available so conveniently or affordably.
Businesses also enhance the productive capacity of a community by training employees, providing expertise, improving lands, providing products which are inputs for other firms, buying the products of local firms to use as inputs, providing scrutiny and criticism of governments, and adding to the case for improved infrastructure in the community. In short, they may provide a variety of backward linkages and forward linkages.
Indigenous Business Generally:
According to reportage in the Spring 2019 edition of Corporate Knights, Indigenous business represents about 1.4% of the Canadian economy. This falls short of the number it should represent if it were proportional to population, but is still quite an accomplishment considering the history. Indigenous business comprises about 45,000 firms generating 30 billion dollars.
The Corporate Knights estimate roughly agrees with the Canadian Council for Aboriginal Business’s 2020 estimate of 50,000 Indigenous-owned businesses generating 12 billion dollars annually. Among Ontario Indigenous-owned businesses, more than half are unincorporated and have no employees; yet two-thirds of these mostly small businesses have sales over $100,000[1].
In terms of businesses located within Indigenous communities, in 2017 there were “over 19,000 businesses located in Indigenous communities (17,000 on First Nations territory and 2,000 on Inuit lands) generating over $10 billion in revenue”[2].
The Canadian Council for Aboriginal Business’ 2016 Aboriginal Business Survey indicated that, for 68% of Indigenous business owners, attracting or finding qualified employees is the biggest challenge. For 31% of Indigenous business owners, the most pressing challenge is findin