What counts as an indigenous enterprise? Evidence from Aotearoa New Zealand

Jason Paul Mika (School of Management, Massey University, Auckland, New Zealand)
Nicolas Fahey (Nick Fahey and Associates, Wellington, New Zealand)
Joanne Bensemann (School of Management, Massey University, Auckland, New Zealand)

Journal of Enterprising Communities: People and Places in the Global Economy

ISSN: 1750-6204

Article publication date: 12 June 2019

Issue publication date: 12 July 2019

Abstract

Purpose

This paper aims to contribute to indigenous entrepreneurship theory by identifying what constitutes an indigenous enterprise, focussing on Aotearoa New Zealand as a case.

Design/methodology/approach

This paper combines policy (quantitative survey) and academic research (qualitative interviews) to answer the same question, what is an indigenous enterprise in Aotearoa New Zealand?

Findings

The authors found a degree of consistency as to what counts as an indigenous enterprise in the literature (e.g., identity, ownership, values), yet a consensus on a definition of Maori business remains elusive. They also found that an understanding of the indigenous economy and indigenous entrepreneurial policy are impeded because of definitional uncertainties. The authors propose a definition of Maori business which accounts for indigenous ownership, identity, values and well-being.

Research limitations/implications

The main limitation is that the literature and research use different definitions of indigenous enterprise, constraining comparative analysis. The next step is to evaluate our definition as a basis for quantifying the population of indigenous enterprises in Aotearoa New Zealand.

Practical implications

The research assists indigenous entrepreneurs to identify, measure and account for their contribution to indigenous self-determination and sustainable development.

Social implications

This research has the potential to reconceptualise indigenous enterprise as a distinct and legitimate alternative institutional theory of the firm.

Originality/value

The research challenges assumptions and knowledge of entrepreneurship policy and practice generally and the understanding of what is the nature and extent of an indigenous firm.

Keywords

Citation

Mika, J.P., Fahey, N. and Bensemann, J. (2019), "What counts as an indigenous enterprise? Evidence from Aotearoa New Zealand", Journal of Enterprising Communities: People and Places in the Global Economy, Vol. 13 No. 3, pp. 372-390. https://doi.org/10.1108/JEC-12-2018-0102

Publisher

:

Emerald Publishing Limited

Copyright © 2019, Emerald Publishing Limited


Introduction

Indigenous entrepreneurship, innovation and enterprise are essential features of indigenous economies and valued means by which indigenous aspirations for self-determination and sustainable development are pursued and realised (Anderson and Giberson, 2003; Dana and Anderson, 2007; Mika et al., 2018; Peredo and Anderson, 2006). Outside of indigenous society, the value and contribution indigenous economies make to the social and economic prosperity of nations is increasingly recognised (Anderson and Giberson, 2003; Collins et al., 2016; Nana et al., 2015; Norman, 2016). Within this context, business owners, managers and entrepreneurs at every level of indigenous economies rely on official (public) and unofficial (private) data to determine the nature, scope and extent of indigenous entrepreneurial and firm-level activity (Bishop, 2016). Yet, policy and practice often proceed on the basis of inadequate official data because of the absence of an accepted definition of indigenous business (Davis, 2016; Foley and Hunter, 2013; Grace and Dudley, 2016; Kukutai and Taylor, 2016).

This paper draws attention to the identity of indigenous enterprise by tracing attempts to define what is a Māori business for statistical, research and policy purposes in Aotearoa New Zealand. A multi-layered analytical lens is applied, one that is pragmatic (‘what works’) (Creswell and Plano Clark, 2011; Crotty, 1998), critical (deconstructing colonising assumptions) (Denzin, Lincoln, and Smith, 2008; Smith, 1999) and constructive (reanimating indigenous business according to principles of indigenous data sovereignty) (Kukutai and Taylor, 2016). The paper addresses the following research question: How can an indigenous enterprise be defined so as to be useful for collecting meaningful business data?

The remainder of this paper is structured into four main parts: First, we outline the nature of an indigenous economy, reviewing literature on definition and measurement, with a particular focus on the indigenous Māori economy. Next, we critically examine ways in which researchers and policy makers have defined Māori business. Taking this into account, we propose a definition of Māori business. Finally, we assess the implications for policy, research and practice.

In this paper, business, firm and enterprise are used interchangeably, unless a specific meaning is given. Indigenous means a person or people whose culture predates colonial settlers and retains a distinctive culture, language, identity, lands and social and economic systems.

Aotearoa New Zealand

Aotearoa New Zealand provides an ideal context in which to answer the research question because efforts here to improve enumeration of indigenous firm-level activity have been ongoing since at least the early 1990s (Bishop et al., 2007; French, 1998; Mika, 2015). One reason for the prolonged gestation of a cogent approach to indigenous business data collection is uncertainty about how to adequately define Māori business. While production of official data on Māori health, education, employment, welfare and justice is fairly routine and comprehensive, comparable precision in data on Māori economic activity is less apparent. As a consequence, macroeconomic analyses of the Māori economy rely on generous assumptions to overcome somewhat cavernous gaps in firm-level data (Nana, 2013; Nana et al., 2011). One of the effects of impaired data is that indigenous policy suffers from the lack of a strong rationale for effective support and intervention (Mika, 2018).

Within indigenous communities globally, an indigenous data sovereignty movement is challenging the dominant paradigm of official statistics as a public resource whose utility is restrained only by state obligations to preserve the anonymity of the citizenry and its firms and the resource limitations of official statistics agencies (Kukutai and Taylor, 2016; Statistics New Zealand, 2012a). Indigenous data sovereignty is about asserting indigenous rights and interests in the collection, ownership and use of data about indigenous people, lifeways, resources and institutions. Indigenous data sovereignty is now playing a key role in highlighting the need for effective definitions (Davis, 2016; Kukutai and Taylor, 2016). Te Mana Raraunga is the Māori Data Sovereignty Network of Aotearoa New Zealand, formed in 2015 (Te Mana Raraunga, 2016). Through its charter and principles, Te Mana Raraunga sets out to advance Māori well-being by:

  • asserting Māori rights and interests in relation to data;

  • ensuring Māori data can be safeguarded and protected;

  • requiring quality and integrity within Maori data;

  • advocating for Māori involvement in data governance; and

  • supporting the development of Māori data infrastructure and security (Te Mana Raraunga, 2016, 2018).

Our analysis of indigenous enterprise and entrepreneurship is conducted with these principles in mind.

Indigenous entrepreneurship

Indigenous entrepreneurship is an emerging discipline with notable differences to non-indigenous entrepreneurship (Dana et al., 2015). This is illuminated in country and locality-specific research (Dana and Anderson, 2007; Dana and Mallet, 2014); cross-cultural comparions (Foley, 2010; Foley and O’Connor, 2013; Hindle, 2005); gender perspectives (Pearson and Daff, 2014; Ratten and Dana, 2017; Zapalska and Brozik, 2017); social, cultural and economic dimensions (Henry, Newth, and Spiller, 2018; Maguirre, Portales, and Bellido, 2017); and individual, family, firm and framework-level studies (Frederick and Henry, 2004; Hipango et al., 2012; Reihana, Modlik, and Sisley, 2006) of indigenous entrepreneurial knowing, being and doing (Mika, Warren, Foley, and Palmer, 2018; Peredo and Anderson, 2006).

Dana (2015) draws attention to place-based differences in world view, language, identity and resources that underpin indigenous heterogeneity. This creates a tendency towards holism in which economic and noneconomic objectives are valued, and traditional knowledge and natural resources are used to effectuate entrepreneurial opportunity (Sarasvathy et al., 2010). Other salient characteristics of indigenous entrepreneurship are a propensity for sustainability, kin-based organisation, personal rather than impersonal exchange, subsistence living in informal economies (Dana et al., 2005), communal rights and obligations and resource sharing (Dana, 2015).

Peredo and McLean (2013) draw on the ideas of Polanyi (1944, 1977) and Heilbroner (1969, 1993) to challenge the presumption of indigenous entrepreneurship as market-based. Polanyi (1944) and Heilbroner (1969) argue that markets are a relatively recent phenomenon that result from the commodification of the environment to land, conversion of work as a communal responsibility to the marketing of individual labour for wages, and transference of money to capital, disembedding these elements from their cultural contexts to facilitate industrialisation. Polanyi’s (1944) concepts of provisioning society based on reciprocity and redistribution and the maintenance of social relationships, rather than self-interest, as the main motive for economic activity create intellectual space for consideration of nonmarket (socially and culturally embedded) conceptualisations of entrepreneurship. In this context, market-based exchange is supplanted by mutual sharing or transfers, which result in additional value for both givers and receivers not necessarily measured in material terms, but in social and cultural value.

Lietaer and DeMeulenaere (2003), cited in Peredo and McLean (2013), find evidence of the coexistence of traditional and nontraditional ways of organising economic activity in Balinese tourism, which uses the dual currencies of time (communal currency) and money (national currency) to sustain cultural traditions and community cohesion amidst massive tourism. Peredo and McLean (2013) argue that indigenous entrepreneurship ought to be grounded in indigenous theory rather than standard economic theories.

Henry et al. (2017) highlight the success of indigenous entrepreneurs who simultaneously preserve their culture and engineer success in mainstream screen production through culturally authentic storytelling and entrepreneurial self-efficacy founded upon a robust sense of cultural origin and purpose. In this context, cultural capital derived from indigenous identity, language and culture blends with social capital procured from indigenous community relations to enable emancipatory entrepreneurship, which transcends constraints indigenous entrepreneurs might ordinarily encounter in mainstream industry and commerce.

It is useful to define three main units of analysis within indigenous entrepreneurship: the entrepreneur, entrepreneurship and the enterprise. Foley (2000, p. 11), cited in Ratten and Dana (2017), defines indigenous entrepreneurs as disrupting:

Traditional patterns of behaviour, by utilizing their resources in the pursuit of self-determination and economic sustainability via their entry into self-employment, forcing social change in the pursuit of opportunity beyond the cultural norms of their initial economic resources.

Foley (2000) points to changes in circumstance, behaviour and resources that result from indigenous entrepreneurship.

Hindle and Lansdowne (2005, p. 132), cited in Ratten and Dana (2017), define indigenous entrepreneurship as “the creation, management and development of new ventures by indigenous people for the benefit of Indigenous people.” The focus on ‘newness’ is a hangover from Schumpeter’s (1911/2000) view of entrepreneurship as innovation, which is reflected in Awatere et al.’s (2017, p. 2) definition of Māori entrepreneurship as a process of value creation from new products, processes and markets for purposes beneficial to self and kin-communities.

Varying definitions associated with indigenous-centred enterprise assistance and procurement policy in Australia prompted Foley and Hunter (2013) to examine what constitutes an indigenous Australian business. Foley and Hunter (2013, p. 72) propose that an indigenous business is one which satisfies three criteria:

  1. at least one owner in a company identifies as indigenous;

  2. the business chooses to identify as an indigenous business; and

  3. the indigenous business community accepts the business as an indigenous business.

In this definition, control denoted through equal or greater indigenous ownership of a business is forgone in favour of capturing a broader number of businesses. Yet, the ‘one owner’ criterion overly diminishes the centrality of ownership, reducing indigenous affiliates to having no greater influence or claims upon a business than any other stakeholder. Self-identity and acceptance by like organisations are defensible attributes as they avert recourse to antiquated markers of racial distinction. However, scale is insufficiently addressed, as large indigenous businesses are not considered within Foley and Hunter’s (2013) definition.

In the next section, we discuss indigenous economies as the context for indigenous entrepreneurship, and consider the significance of firm-level data in this environment.

Indigenous economies

We define an indigenous economy as an ethnic economy that aggregates capital stocks and flows of an indigenous people within a given time and place. Indigenous economies are as diverse as the people themselves and may reflect traditional subsistence economies, producing cultural products, centred around communal ownership and production, with reciprocal non-monetised systems of exchange and an inherent focus on sustainability, collectivities, spirituality and cooperation (Altman, 2001; Bamba, 2010; Kuokkanen, 2011; Warren, 2009). Or, an indigenous economy may resemble Western conceptions of economy and commerce with a focus on economic growth, wealth creation, private property, productivity, profitability and market exchange (Croce, 2017; Foley and O’Connor, 2013; Meredith, 2012). The former (traditional economies) tend to be in remote regions, where traditional knowledge and customary values still drive economic activity (Bamba, 2010; Croce, 2017; Dana et al., 2005). The latter (non-traditional economies) are more apparent in urban centres, where elements of Western commerce have been adapted into indigenous usage (Bamba, 2010; Cornell and Jorgensen, 2007; Croce, 2017). Then there is the “in-between” economy, captured in Altman’s (2007) hybrid economy, which conceptualises indigenous economies as three interlinked components of the state, the market economy and the customary economy. While mostly used as an analytical construct, the hybrid economy highlights the tenuous balance between state intervention without fostering paternalism and dependency and growing the customary (subsistence) and market (capitalist) economies without one subsuming the other (Buchanan, 2016).

The commonality of indigenous economies is their indigeneity. That is to say, these are economies of self-identifying indigenous peoples living in all of their diversity as original inhabitants of a territory, with distinctive languages and cultures constituted from immutable relations with earth and sky (Bargh, 2012; United Nations, 2009; World Bank, 2010). Who is and who is not an indigenous person is contrived by state policy, societal sentiment and historic and dispiriting discrepancies between legislative, policy and traditional ways of defining indigenous peoples (Kukutai and Taylor, 2016; Lightfoot, 2016). Within this context, uncertainty reigns about what is an indigenous enterprise, and whether and how their economic (capitalistic) and noneconomic (customary) value ought to be counted. There is also the philosophical, conceptual and operational matter of separating out the indigenous economy from the non-indigenous (mainstream) economy. One approach is direct sampling of indigenous peoples and their enterprises, which has been attempted in several countries (Adamson and King, 2002; Statistics Canada, 2002; Statistics New Zealand, 2016b).

A straightforward empirical question such as ‘What is the total value of the world’s indigenous economies?’ illustrates the insolubility of accounting for global indigenous economic activity. While a comparable figure is readily attainable for the world economy overall, circa US$75tn in 2017 (Central Intelligence Agency, 2017; United Nations, 2017; World Bank, 2018), statistics agencies are unlikely to possess sufficiently reliable data to calculate the size of global indigenous economic activity. Yet, the figure and its calculation seem well worth knowing.

One of the challenges with measuring indigenous economies is that this implies official recognition, real or notional, of indigenous interests in the ownership of natural resources, which may be an unappealing prospect for dominant non-indigenous political and business interests with a history of depriving indigenous peoples of their lands and other resources (Battiste and Henderson, 2000; Lightfoot, 2016; Round, 2009). Indigenous self-determination and indigenous ownership of resources are ongoing struggles, with indigenous data having an important role to play in this (Dahl and Rose, 2010; Kukutai and Taylor, 2016; Lightfoot, 2016; United Nations, 2009).

Indigenous Māori economy

In Aotearoa New Zealand, over the past 90 years, numerous attempts have been made to document the nature of the Māori economy, typically from a non-Māori (Western) perspective, initially in anthropological studies, but more latterly in policy discourse (see Figure 1 for a sample of these works). Firth’s (1929) thesis on pre-European tribal economics and Belshaw’s (1940) paper on the Māori economic position represent early analyses of the Māori economy using established Western empirical methods. This is followed, in our selection, by the Hunn (1961), which included a detailed account of Māori socioeconomic conditions that was used as the basis for reforming Māori affairs. Butterworth (1967), a historian, completed a study of Māori participation in a range of industries for the New Zealand trade department. It was not until 1984, at Hui Taumata, the Māori Economic Summit, that a distinctly indigenous view of the Māori economy entered into Māori economic, business and policy discourse (Love, 1984a, 1984b). This summit set in motion a decade of Māori development centred around Māori self-determination and economic independence (Durie, 2005).

Contemporary interest in the Māori economy was renewed with the establishment in 1991 of Te Puni Kōkiri (meaning a group moving together) or the Ministry of Māori Development (Henare et al., 1991; Walker, 2004). Te Puni Kōkiri has been associated with most attempts to value the Māori economy since 1996, all of which rely on official data (Table I). What is discernible from Table I is that the value of the Māori economy seems to have grown markedly over a relatively short time, from NZ$4.6bn in 1997 to NZ$42.6bn in 2013 (Nana et al., 2015). Two explanations given for this rapid growth are improved data quality and real growth in economic terms (Nana et al., 2011).

In Aotearoa New Zealand, the value of the Māori economy has become a focal point among Māori and non-Māori. For Māori, the figure represents an anchorage around which to build a case for the legitimacy of the Māori economy as a distinctive institution (Davies, 2007; Durie, 2005; Hui Taumata Steering Committee, 2005). For non-Māori, the value of the Māori economy represents a fascinating alternative economy in which to do business (Bargh, 2012; Barry, Nelson, and Noble-Campbell, 2016; Hanita et al., 2016; KPMG, 2017; Norman, 2016). While the validity (truth) and reliability (accuracy) of the figure denoting the value of the Māori economy is important to establish, of equal import is what the figure represents about the Māori economy and its capacity for sustainable indigenous self-development (Mika et al., 2016; Smith et al., 2017; Smith et al., 2015).

While statistical methods have been incrementally refined, a consistent theme is the difficulty in constructing reliable estimates of the Māori economy because the required data on Māori enterprises are not available. As a consequence of data limitations, broad definitions of the Māori economy have been adopted. The NZIER (2003, p. 7), for instance, defines the Māori economy as:

The assets owned and income earned by Māori – including collectively-owned trusts and incorporations, Māori-owned businesses (e.g., tourism, broadcasting, and the self-employed), service providers (especially in health and education), and the housing owned by Māori [and the] wages and salaries earned by Māori workers.

Economic consultants, BERL, similarly define the Māori economy as:

All entities and enterprises that self-identify as part of the Māori economy [including] collectively-owned assets, or those arising from Treaty Settlements […] Māori entrepreneurs active in individually-owned businesses and/or SMEs, as well as the contribution of Māori employees in terms of wages earned. (Nana et al., 2011, p. 6).

Within these definitions of the Māori economy, what constitutes a Māori business varies between standard forms of ethnic enterprise such as self-employed and employers (Ministry of Business Innovation and Employment, 2014) and non-standard forms such as post-settlement governance entities, Māori providers and Māori authorities (Henry, 1997; Morgan and Mulligan, 2006). Māori authorities, primarily Māori incorporations and ahuwhenua land trusts, established under the Māori Land Act 1993, are subject to their own tax regime in respect of business income (IRD, 2001; Mika, 1994, 1995). Because of this, Māori authority tax records provide a ready source of Māori enterprise data, albeit with limitations as some Māori authorities are able to opt out of the regime (Bishop et al., 2007; Statistics New Zealand, 2012a).

This diversity of Māori business has challenged Statistics New Zealand, the country’s official statistics agency, to arrive at a definition that satisfies its statutory obligations, methodological standards and community expectations (Statistics New Zealand, 2012a). In short, there are no easy answers when it comes to defining Māori business.

Defining Māori business

Given that indigenous firms operate within the context of prevailing political and economic systems, it is useful to briefly consider what constitutes a firm from a Western theoretical perspective. There are four broad ways of defining a firm – as institutions, organisations, legal entities and as resources – with all four having an institutional basis because firms are socially constructed with their own cultural, historical, structural and contextual peculiarities (Brousseau and Glachant, 2008; Chavance, 2009). The four approaches are defined in turn.

First, as institutions, firms exist to regularise human behaviour to deal with the uncertainty of a business environment characterised as involving impersonal and non-repetitive market-based exchange (North, 1990). To Coase (1937, p. 393), a firm is an institution formed “when the direction of resources is dependent on an entrepreneur” rather than the open market. Second, Barnard (1938, p. 82) asserts that an organisation “comes into being when (1) there are persons able to communicate with each other; (2) who are willing to contribute action; (3) to accomplish a common purpose”. The “vitality” of an organisation, however, relies on the “willingness [of people] to serve” the organisation’s purpose (Barnard, 1938, p. 82). Third, legally, a firm is established when an organisation is given formal recognition as a legal entity, separate from its owners and members, enabling the entity to conduct business in its own right, with companies the most common form in Aotearoa New Zealand (Ministry of Business Innovation and Employment, 2018a; Schaper et al., 2014). Fourth, is the resource-based view of the firm, advanced by Barney (1991), Prahalad and Hamel (1990), Teece et al. (1997) and others as a way for firms to secure sustainable competitive advantage on the basis of valued and protected resources – financial, human, social, physical, organisational and technological – from which value is created (Brush et al., 1997). Entrepreneurship is thus a function of entrepreneurial capital, which represents aggregations of financial and nonfinancial assets, in both tangible and intangible forms (Firkin, 2003; Light and Gold, 2000; Mika, 2017).

When ethnicity and indigeneity of the firm are introduced, officials and academics are inclined to propose a wide range of definitional criteria, which do not generally apply to conventional enterprises, in their attempts to distinguish ethnic and indigenous enterprises from the ‘norm’ (French, 1998; Harmsworth, 2009; Love, 2004). For example, ownership, management, values, employment, products and services, customers, assets and community relations are some of the attributes that have been used to differentiate Māori business (Davies, Lattimore, and Ikin, 2005; Durie, 2002; Harmsworth, 2005; Henare, 2011; Ruwhiu, 2005; Tinirau and Gillies, 2010).

One of the most salient studies on Māori business remains French (1998), who used Gordon’s (1996) five methodological alternatives as a framework for his survey on what is a Māori business:

  • Descriptive method: a series of parameters indicative of a Māori business.

  • Points method: descriptive parameters in (i) above are weighted from 1-10 (10 is significant).

  • Control method: degree of ownership and managerial power and control.

  • Tiered ownership method: mainly control, but combines descriptive methods.

  • Self-identification: simple (no other qualifiers) and complex (other qualifiers are essential).

French (1998) found that Gordon’s tiered ownership method (ownership, plus existence of other parameters to indicate Māoriness) was preferred as a comprehensive definition of a Māori business, but complex self-identification prevailed when practicality, ease of use and cost considerations were applied. A single criteria for defining Māori business was not evident, though degree of ownership was favoured by 43 per cent of the 153 respondents, followed by degree of Māoriness and support for Māori development (French, 1998).

Durie (2003a) sought to modify the emphasis on commerciality as the dominant ethic among Māori business leaders by introducing his concept of the Māori-centred business. A Māori-centred business is one that “deliberately revolves around Māori people, Māori assets and Māori priorities,” indicated by the interplay between Māori development goals (economic, social and cultural) and Māori development principles (aspirations, transparency, balance, integration and alliance) (Durie, 2003b, p. 246). A Māori-centred business introduces added complexities, most notably:

  • How can cultural and commercial values be harmonised?

  • How can competition between Māori be managed to maximise benefits for Māori?

  • Is a Māori business ethic identifiable?

Harmsworth (2005) concurs with Durie (2003a) by characterising a Māori business as one in which Māori own and operate the business, Māori staff are employed and kaupapa Māori is the focus.

There is a degree of consistency in the definitions of Māori business between the earlier studies (French, 1998) and recent research (Mika, 2015). Specifically, in a qualitative study of Māori entrepreneurship, Mika (2015) asked 21 Māori entrepreneurs how they defined Māori business. Māori values and Māori ownership were identified as defining characteristics, with self-identification, self-determination, institutional form and distributional policies also appearing, though less prominently (Mika, 2015). While the consensus among Māori entrepreneurs (see for example, French, 1998) is that 50 per cent or more ownership by Māori qualifies as a Māori enterprise, an alternative view suggests a lower threshold is more legitimate because the 50 per cent level excludes enterprises with a sizeable minority indigenous stake (e.g. 20-49 per cent indigenous ownership) (Foley, 2013; Mika, 2013). For the moment, the 50 per cent threshold is the main criteria used by institutions that target Māori because it accounts for spousal businesses where one or the other partner is Māori and other combinations of ownership (Grimes et al., 2016).

Counting Māori business

Various approaches are being explored to improve official enumeration of Māori businesses. They include:

This last approach has the potential to shift Māori business statistics from being a Tier 1 Statistic “under development” to an actual Tier 1 Statistic. This is significant because a Tier 1 Statistic is sanctioned by government as essential in its decision making, of high public interest and adheres to international standards (Statistics New Zealand, 2012b).

Tatauranga Umanga Māori is a Statistics New Zealand initiative intended to improve Māori business statistics (Statistics New Zealand, 2012a). In 2012, Statistics New Zealand conceptualised their approach as concentric circles with Māori enterprises that manage collectively-held assets (e.g. Māori land trusts and incorporations) at the centre, representing the starting point, and Māori-centred business definitions further out as an aspirational object (Statistics New Zealand, 2012a). Thus, until recently, Statistics New Zealand (2012a) limited its definition of a Māori business to a Māori authority, based on the Inland Revenue Department’s eligibility criteria. Defining a Māori business in this way was administratively expedient because it relied on data already collected by the tax department, supplemented by data from the Companies Office. Māori authorities were identified for inclusion in successive Tatauranga Umanga Māori outputs by using a Māori Business Indicator flag on the Statistics New Zealand Business Register.

Statistics New Zealand’s operational definition of a Māori business as “a business with a collectively managed asset” came to assume the status of a conceptual definition for the purposes of the department’s Business Register (Statistics New Zealand, 2014, p. 16). In its latest report, Statistics New Zealand (2016b) revised its definition of Māori business, creating both conceptual and operational definitions (see Table III). Their operational definition was based on recently identified lists of Māori enterprises from two Māori institutions: Poutama Trust, a national provider of Māori business grants and assistance (Mika, 2013), and New Zealand Māori Tourism, a national industry association of Māori tourism operators (Tayawa-Figuracion, 2013). This change allowed identification of Māori authorities and Māori small and medium-sized enterprises (SMEs) on the Business Register.

Statistics New Zealand (2016b) noted bias as a limitation of identifying Māori businesses by association. Bias occurs in two main ways: selection bias (e.g. Māori enterprises opting to affiliate with New Zealand Māori Tourism) and administrative bias (e.g. Poutama Trust choosing which businesses to assist based on its criteria) (Statistics New Zealand, 2016b; Wren and Storey, 2002). However, this concern about bias needs to be weighed against expansion of the Māori business population and the quality of accessible Māori business statistics. Through the third-party lists, existing administrative data, and survey data from a recent trial, an additional 1,377 Māori businesses have been identified, comprising both Māori authorities and Māori SMEs (Statistics New Zealand, 2016b).

The framework for extending Statistics New Zealand’s definitions centres on two conceptions of Māori enterprise: Māori business and Māori in business (Table III). Māori business is conceptually defined as an enterprise contributing to collective Māori well-being, consistent with Durie’s (2003a) concept of Māori-centred business. In this paper, collective Māori well-being is intimated by self-identifying as Māori, Māori cultural capabilities, degree of engagement in te ao Māori (Māori society) and in te ao whānui (wider society) and achievement of a good life (Cram, 2014; Durie, 2006; Henare, 2011). For Statistics New Zealand, its conception of Māori business is based on a decade of research and engagement with Māori, followed by factors tested in the Māori business self-identification question trialled in the 2015 Business Operations Survey (Statistics New Zealand, 2016b). The survey confirmed that the leading factors for businesses identifying as Māori are: ownership (85 per cent); tikanga, philosophy, principles and goals (62 per cent) and other factors (Statistics New Zealand, 2016b). There is a surprising degree of consistency between French’s (1998) survey and the Business Operations Survey in terms of the relative importance of the parameters (see Table IV).

The concept of Māori in business relates to enterprises that Statistics New Zealand can in some way identify as Māori, but which it is unable to confirm meet its Māori business definition of contributing to collective Māori well-being. Experimental analysis identifying Māori enterprises was undertaken by Statistics New Zealand between January and April 2016 using linked and anonymised census and tax data held within the IDI (Statistics New Zealand, 2016a). This work identified approximately 36,000 additional enterprises that potentially could be considered Māori in business, or who, if followed-up, could self-identify as a Māori business. They comprise self-employed enterprises and Māori operating as partners, company directors, sole traders and working proprietors (Statistics New Zealand, 2016b).

Towards a unifying definition of Māori business

This paper finds a degree of uniformity in the defining characteristics of Māori business between indigenous research, public policy and official statistics (French, 1998; Harmsworth, 2009; Mika, 2015; Statistics New Zealand, 2016b). Ownership by Māori and the application of Māori values are material attributes. On this basis, we define a Māori business as one which:

  • self-identifies as a Māori business;

  • has 50 per cent or more Māori ownership;

  • applies Māori values implicitly or explicitly; and

  • contributes to collective Māori well-being.

Other attributes of institutional form, system of organisation, legal identity, firm-level resources, industry, sector and location amplify the contours of a Māori business, but the functionality of our definition is not negated by their absence. While further evaluation in conceptual, operational and indigenous terms is necessary, we argue this definition suffices as an abstraction of what counts as an indigenous enterprise in Aoteaora New Zealand.

Tatauranga Umanga Māori has demonstrated that self-identification as a Māori business, either directly or by association, is a conceptually sound and operationally feasible means of expanding the Māori business population towards the eventual goal of producing Tier 1 Māori business statistics (Statistics New Zealand, 2016b). Furthermore, Statistics New Zealand’s Business Register contains a Māori Business Indicator ready to be updated to allow expanded identification of the Māori business population (Statistics New Zealand, 2016b).

Identification of Māori business and associated statistics are evolving at the pace at which administrative data and third-party lists allow. Other possibilities may help expedite the process. These include enabling Māori enterprises to self-identify as a Māori enterprise more broadly in the tax system and other principal sources of administrative data on business, which may then be drawn together and, where appropriate, linked through the IDI and the powerful Longitudinal Business Database. The apparent complexity, administrative cost and widespread aversion to compliance costs make the use of an ethnicity indicator in business tax records unappealing (Dalziel, 2006; SBAG, 2006). Yet, a Māori ethnicity indicator of sorts is already in active use by virtue of linking Māori authorities’ tax codes to the Māori Business Indicator flag on the Business Register; a procedure and infrastructure seemingly already exist.

Conclusions

This paper set out to explore how an indigenous enterprise can be defined so as to be useful for collecting meaningful business data. To do this, we firstly defined an indigenous economy as capital stocks and flows of an indigenous people within a given time and place. This definition forms the context for what is an indigenous enterprise. Within this context, firm-level data are essential in entrepreneurial decision making, and when aggregated to the level of the economy, these data become highly influential in public policy, economic analyses and indigenous development. Indeed, the infrastructure and system of collecting and producing official data on business has become so sophisticated and routine that it is easily taken for granted. Yet, when subjecting indigenous economies to enquiries as to their nature, scale and dynamics, data limitations readily appear, which constrain research, policy and practice.

We found that the identity of indigenous enterprise in Aotearoa New Zealand is primarily contingent upon ownership and cultural identity. What is not addressed is the scope for enabling Māori to collect, store, own and use data about their own people, enterprises and economy. We urge others to evaluate our definition of Māori business and contribute to indigenous entrepreneurship theory.

Difficulties in settling on an agreed definition have been proffered as part of the reason for delays in improving Māori business data, but the work of Tatauranga Umanga Māori, which is consistent with earlier research, has shown that conceptually sound and technically feasible methods have been found to alleviate definitional issues as an impediment to better Māori business data. When the current system and state of official Māori business data is assessed against the principles of indigenous data sovereignty, we find that indigenous aspirations for self-determination and sustainable development are curtailed. Indigenous peoples have a right to business data and to be involved in ensuring the quality, integrity and protection of such data. Researchers and policy makers have a key role in the fulfilment of indigenous entrepreneurs’ development aspirations and meaningful firm-level data is integral to this.

Figures

Timeline of Māori economy research reports (1929-2015)

Figure 1.

Timeline of Māori economy research reports (1929-2015)

Estimates of the value of the Māori economy from 1996 to 2013

Year of publication Māori commercial assets Māori contribution to GDP Main source of data and method Citations
1996 Unstated $1.15bn Original Māori social accounting matrix (SAM), official statistics NZIER (2007)
1997 $4.6bn Unstated Fixed assets Rose, Sanderson, Morgan, and Andrews (1997)
2003 Unstated $1.921bn Māori social accounting matrix (SAM) NZIER (2003)
2006 $16.45bn Unstated Annual Enterprise Survey, published annual accounts, land valuations Kooyela (2007)
2007 Unstated $2.563bn (1) Updated Māori social accounting matrix (SAM), official statistics NZIER (2007)
2010 $36.9bn $10.3bn Annual Enterprise Survey, Census, Household Labour Force Survey, revised SAM Nana et al. (2011)
2013 $42.6bn $11bn Annual Enterprise Survey, Census, Household Labour Force Survey, revised SAM Nana et al. (2015)
Note:

(1) 2003 figure updated by NZIER in 2007

Māori business definition parameters and attributes

Parameter Description
Product Goods and services with a Māori cultural component
Ownership Ownership level (percentage) and structure
Aims and goals Aims and goals meet Māori needs or develop Māori people
Management Two aspects: (1) methods and structures and (2) Māori managers
Culture/values Māori values underpin the business
Employees Two aspects: (1) number of Māori staff and (2) values of employees
Source:

Adapted from French (1998, p. 30)

Statistics New Zealand definitional framework for Māori business

Conceptual Operational
Māori business Māori authorities and their subsidiaries āori small and medium-sized enterprises
Māori in business Māori self-employed

Source: Statistics New Zealand (2016b)

Comparison between French (1998) and business operations survey (2015)

French survey (1998) Business Operations Survey (2015)
Parameter Importance (%) Parameter Importance (%)
Employees (values) 90 Ownership 85
Ownership 89 Philosophy 62
Aims and goals 85 Employees 53
Management (practices) 84 Management practices 40
Culture/values 83 Branding 35
(Māori) employees 74 Intangible assets 32
(Māori) managers 73 Tangible assets 29

Source: Adapted from French (1998) and Statistics New Zealand (2016b)

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Corresponding author

Jason Paul Mika can be contacted at: j.p.mika@massey.ac.nz