CCAB's JP Gladu on Federal 5% Indigenous Procurement and Supply Change™

Shared Value Solutions's Laura Taylor recently sat down with JP Gladu, CEO of the Canadian Council for Aboriginal Business (CCAB), to talk about what the federal 5% Indigenous Procurement means for the Indigenous economy - and all of Canada. We also asked about the CCAB's Supply Change initiative. Read on for this very good news story we all need to hear about!

SVS: Tell us about CCAB's role in making the federal 5% Indigenous procurement

JP Gladu: Aboriginal businesses have been doing really well in the private sector, but we knew from our research that the federal government had struggled with their Procurement Strategy for Aboriginal Business, and we saw an opportunity. Some years they have spent as low as 0.32% of their total spend, which is approximately $65 million a year. In comparison, in Alberta alone in 2017, the oil and gas sector spent $3.3 billion in one year on Aboriginal procurement. We have challenged the federal government over the last few years to do better, to spend 5% of their procurement on Aboriginal business, which is commensurate with our population.

Through our world-leading research on the Indigenous economy, we found that Aboriginal business could hit 24.2% of federal spend. We blew the 5% out of the water. The federal government committed to a 5% target in its last mandate letter and we're incredibly proud of that.

SVS: Do you think the fact that it's now actually in mandate letters will make a difference?

JP Gladu: At this point, having a target in a mandate letter is a positive step but it’s aspirational, so we need to continue to hold government accountable to make sure they meet the target. To do that, we need to be able to put the programs, the research, and the relationships in place to reach those targets and to evaluate how we're doing year after year.

SVS: What does the 5% Indigenous procurement target mean to the Indigenous economy?

JP Gladu: Right now, the government's spending less than a percentage, often as low as 0.32% or so, which is $65 million. If the federal government hit 5% Indigenous procurement, that would contribute $1 billion to the Indigenous economy and to Indigenous entrepreneurs. If we can push boundaries to provincial, territorial and municipal governments and if every government targeted 5%, which is commensurate with our population, that would contribute about $23 billion to the Indigenous economy. And that's just the government sectors.

If we look at the private sector, companies like Suncor for instance, is targeting 5%. Last year this one company alone spent over $700 million on Indigenous entrepreneurs. The impact that spending has had on the community is clear. In Fort McKay First Nation, the average annual salary is $73,500 compared to $50,000 per capita for an Albertan and $38,000 for a Canadian.

SVS: Will CCAB be actively involved in helping the government meet their commitment?

JP Gladu: They set these targets in part because they believed in our research and our programs. We've got the Procurement Marketplace and a long list ofCertified Aboriginal Businesses. We’re highly invested in the government meeting this target and we’re prepared to take the next steps required to support their success. It's going to be a challenge, but we can do it.

SVS: Tell us about CCAB’s Supply Change initiative.

JP Gladu: Supply Change™ is about creating business opportunities between Indigenous and non-Indigenous organizations that are looking to procure goods and services from Aboriginal businesses or entrepreneurs.

When I became CEO, we tried to get a procurement platform off the ground and quickly realized that this is a type of online software that takes millions of dollars to develop. I thought, "this is way outside of our scope," but we knew we had all the components for Supply Change™. We had corporations – Indigenous and non-Indigenous – that were looking to fill their supply chains with Aboriginal businesses and entrepreneurs, and then we had a long list of Certified Aboriginal Businesses ready for new contracts.

When we were ready to launch this initiative at our Toronto gala a few years ago, we called up Mark Little, COO of Suncor at the time and we asked if he would stand up at the front of the room to challenge corporations to do better in the way that they procure from Aboriginal businesses. He understood the impact not only for communities and entrepreneurs, but also for Suncor. So, Mark stood up at the front with me and today we have close to 60 Procurement Champions, a group of corporations committed to increasing opportunities for Aboriginal businesses.

SVS: How does the CCAB's Aboriginal procurement marketplace function?

JP Gladu: The Aboriginal Procurement Marketplace is an online platform where you can post a Request for Proposals and Indigenous companies can respond to it.

Before an Aboriginal company can access the platform, we make sure that the businesses that are competing in the marketplace are indeed Aboriginal businesses. So, CCAB verifies them as Métis, Inuit and First Nation companies before they're allowed to bid on opportunities in the marketplace.

SVS: Recognizing that there's a difference in supporting businesses that are in more remote locations, how does CCAB consider and address that?

JP Gladu: Certain regions of Canada certainly do struggle with developing economic capacity. Quite often, that's a result of lack of infrastructure. If you don't have access to the internet, if you don't have access to energy to support the growth of your community, if you're constantly worrying about clean drinking water, that takes away from your ability to compete in a world economy. I think the challenge in this country with the $30 - $40 billion deficit in our Indigenous communities is to embrace the idea that there is capacity, we just haven't mined it yet. Indigenous people in the farther reaches of our country have a desire to support, compete, and be a part of an economy, which they've largely been shut out of because of a lack of infrastructure.

Large corporations have a responsibility to work with our governments and vice versa, to support infrastructure reaching into those communities. An example that comes to mind is Wataynikaneyap Power. Twenty-four First Nations are leading the charge in a partnership with Fortis Inc. to bring grid connection to seventeen remote communities.

SVS: Is the CCAB looking at ways to measure the social return on investment piece of this change?

JP Gladu: CCAB has a program called Progressive Aboriginal Relations (PAR). It's been around for about 19 years. There are over 105 companies across the country from various sectors, various sizes that are measuring the way that they work with and support Indigenous businesses in communities. They’re measuring the way they procure, the way they employ, invest and engage with our communities. One of the things that we're starting to recognize is the socioeconomic impact that these PAR companies are having in Canada is immense. They're spending billions of dollars in Indigenous communities, on Indigenous businesses and on our people. They're employing tens of thousands of our people in their businesses. We can start to put a measurement on that.

SVS: What advice do you have for aspiring Indigenous entrepreneurs who are looking at this 5% procurement opportunity and thinking, "How can I take advantage of this?"

JP Gladu: Be brave. Throw yourself out there. I think what you'll find is that there'll be organizations like CCAB and corporations that are CCAB members, that are willing to mentor, willing to take a chance on you, but you have to have the courage to step up and put yourself out there. And I know a lot of our Indigenous entrepreneurs do. Success doesn't come easy. Quite often, it's blood, sweat and tears. Don't give up.

SVS: What's coming next for CCAB?

JP Gladu: CCAB has been an incredible journey for me the last seven and a half years. The team that we've built here, from seven to 30 plus staff, and the membership has grown from 180 to almost a thousand. It has been an incredibly rewarding experience.

I'm moving on to a new role now, as the CEO of the Bouchier Group, which is run by Dave and Nicole Bouchier, so CCAB is now working on choosing my successor. There's an incredible team here. I know that my successor will have all the support that he or she will need and will take the organization through the next phase of its journey.

Indigenous Business Success Stories Blog Series Now an eBook!

As seen at the PDAC 2020 Indigenous Program:

Here's what's in it:

The number of successful, thriving Indigenous businesses that got their start connected to the resource sector is growing at an exciting rate. If you’re looking for ideas on how to take advantage of opportunities both basic and complex, this session is for you! If you’re a proponent that’s new to establishing agreements and joint ventures with Indigenous businesses and economic development entities, come learn about the intriguing opportunities that exist in the realm of Indigenous procurement.

Representatives from four dynamic businesses will share their journeys and advice. We will also take a deep look into a novel proponent-First Nation business arrangement whose partners have agreed to share their process. Learn about best practices related to contracting and business opportunities, and the increasing use of sole-source rights entitlements. When Indigenous businesses thrive, everyone wins!

Guest Authors:

Jordan Baptiste, Director, Business Development
Des Nedhe Development
Ginny Michano, President, Pawgwasheeng Economic Development Corporation
Robert Starr, Business Project Manager, Supercom Industries
Marsha Smoke, President, Moccasin Trails
Alexandre Meterissian, Vice-President Government Affairs, Blackrock Metals
Chief Curtis Bosum, Ouje-Bougoumou Cree Nation
Facilitators: Laura Taylor, SVS and Harvey Sands, Richter

Read all the posts in the series here:

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