Urgent changes needed in Ngai Tahu representation
17 October 2006
It is time for some changes at the top of Ngai Tahu, in the interests of the whole tribe, writes RICHARD PARATA.
"Iwi pleads for more openness"; "Ngai Tahu beneficiaries are calling for greater transparency in the way their assets are managed" (The Press, September 22). I could not agree more. The time has come for all Ngai Tahu to be informed and involved, through democratically elected representatives.
The blame for recent troubles has been attributed to Mark Solomon, kaiwhakahaere (chairman) of Te Runanga o Ngai Tahu (Tront – the tribal council). Solomon is a good leader; a master of his brief. But Ngai Tahu's woes can be attributed to several factors other than leadership. These are internal political interference in its commercial operations, inexpert executive advice and, most importantly, a flawed structure that discourages democracy at a marae level and thus good governance.
The Ngai Tahu political and executive structure is similar to that of a local authority. Tront is made up of 18 people, elected every three years, representing the 18 Ngai Tahu marae. Tront elects a chairman and deputy chairman from within its own ranks.
The role of a representative, the equivalent of a city councillor, is to act primarily in the collective best interests of the 37,000 Ngai Tahu beneficiaries. Their second role is to represent the interests of their runanga. The third important function is to act as the trustee – a custodian of the tribal assets.
In these roles, Tront sets policy for the tribe, including around its investments. Representatives must act reasonably in making decisions.
A full-time executive office services Tront, headed by a chief executive. The CEO is Tront's principal adviser and should provide impartial advice and implement Tront decisions. A key role of the executive office is to monitor the performance of Ngai Tahu Holdings Corporation, the commercial arm (with assets including tourism, seafood, property and equities). Ngai Tahu Holdings' task is to maximise the financial returns and create long-term wealth on behalf of the trustee.
Until recently, Ngai Tahu Holdings had a board of eight, of whom five were independent professional directors. The CEO of the executive or his staff, and the kaiwhakahaere and his deputy are entitled to attend any of the holding corporation's board meetings. In earlier years, the executive office role worked well. The former CEO, Sid Ashton, in his monitoring role, attended all Ngai Tahu Holdings board meetings and provided independent comfort and feedback to Tront.
The current CEO, Tahu Potiki, attended no more than five board meetings in the 4½ years to June. Hence the conduit role has faltered. Just as local-body politicians cannot operate without sound executive support, neither can Tront. Ngai Tahu Holdings has operated autonomously since its inception in 1997. Under that structure, it has had a good record of commercial success, growing assets from $170 million at the time of the settlement to nearly $600m in the last financial year. It is arguably the most successful iwi business in New Zealand and can hold its head high among New Zealand's top commercial enterprises.
Ngai Tahu's reputation as a leading iwi business is in tatters and the commercial returns Tront seeks for distribution to beneficiaries will wane.
However, this autonomy has been a constant source of tension between Ngai Tahu Holdings and Tront. That tension is led by the executive office and its CEO. Lack of unbiased advice to the Tront board about Ngai Tahu Holdings' activities has led to a cabal of commercially inexperienced representatives on the Tront board making their own commercial judgments. Ngai Tahu Holdings has been used as the pawn between rival factions in a dysfunctional Tront. Such divisive behaviour has had the tacit support of the executive, with numerous attempts to unseat the kaiwhakahaere.
The process by which the 18 representatives are appointed to Tront is not democratic. Few of the 37,000 eligible beneficiaries have the opportunity to vote directly for a person to represent them.
A major problem is that voting is marae-based and through an electoral college. Only some marae allow fully democratic postal voting. All beneficiaries can trace their whakapapa to more than one marae and by right can vote on multiple marae, and therefore the system allows multiple votes. But implementing a full multiple-vote system would produce more problems than it would solve.
It does not help in seeking the participation of beneficiaries that 55 per cent live outside the tribal area, in the North Island and overseas. Lack of democracy means that Tront is not truly accountable to the people. Unbridled power has taken precedence over the democratic needs of the beneficiaries, with serious consequences for the tribe's financial future. Ngai Tahu Holdings' earlier financial success was based on separation of the tribal political issues from the commercial functions supported by a high level of corporate governance. All beneficiaries should be concerned by the recent resignations of Ngai Tahu Holdings' chief executive Robin Pratt and its board. Ngai Tahu's reputation as a leading iwi business is in tatters and the commercial returns Tront seeks for distribution to beneficiaries will wane.
Having a dysfunctional Tront with an inadequate democratic process, and receiving inexpert advice, is problematic. Removing the separation of commercial and political functions heralds disaster.
The tribe must urgently address the issues of independence between Ngai Tahu Holdings and its executive office, interference in its commercial operations and its lack of democracy. Tront should relinquish its role as trustee and custodian of the tribal assets and hand over the role to trustees elected directly by beneficiaries. Otherwise Solomon will continue to try to govern the ungovernable.
* Richard Parata served on the Ngai Tahu tribal council representing Kati Huirapa ki Puketeraki from 1991 to 1998, and was a director of Ngai Tahu Holdings from 2000 to June, 2006. He has a background in the military and in business and is establishing a website, www.ngaitahushareholders.co.nz, which will be active in about three weeks, to better inform Ngai Tahu beneficiaries about issues confronting the tribe.