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Dr Pita Sharples - Business Law Reform Bill

Business Law Reform Bill
Dr Pita Sharples, Co-leader, Maori Party
Delivered at 8pm; Wednesday 19 July 2006

It’s a long trip from Taupo to Dubai.

But for Tuwharetoa fashion designer, Peter Loughlin, it’s a trip he makes regularly, in his determination to connect with home.

Peter was honoured as an Outstanding Maori Business Leader for 2005 by The University of Auckland Business School.

Peter dresses some of the world’s most influential and wealthy women through his House of Arushi. This fashion house is known for exclusive jewel-encrusted and fine beaded dresses. It is considered one of the Gulf region's most prestigious labels.

Clientele include the royal families of the Kuwait, Qatar, Saudi Arabia and Oman who are all happy to purchase an Arushi design, for, if they’re lucky, $200,000.

Every year, through his foundation scholarships, a young Maori designer is supported to travel to Dubai and work alongside Peter, gaining experience with materials and techniques rarely used at home.

Such is the nature of Maori Business.

The splendour of indigenous leadership, entrepreneurship and innovation encapsulated in Maori enterprise has captured the world.

While back at home, Maori business has become so mainstream that it is now offered as a major for the BCA degree up at Victoria University.

Maori business success has earnt us international reputations as entrepreneurs. A status of excellence has been acquired through the fruits of diligence, perseverance, of preparation.

The Maori Party draws on that success in considering the proposals in the Bill to reduce compliance costs, particularly for small businesses, without risking their stability and potential for success.

The key over-riding factor in the Bill is that the operation of business can be clear, efficient and effective.

How can we argue with that?

The Maori Party is proud to celebrate Maori business as a major contributor to the New Zealand economy.

But we know that for far too many Maori enterprises, the dream run is short lived. Sadly the correlation of ‘Maori business’ with ‘longevity’ is not well established.

We must do all we can to deliver on expectations and aspirations; to create a climate of success.

Not a climate that is submerged under the flood of too many great ideas without the structure of a framework to pin them on.

But a climate in which we actively manage for inspiration.

The Bill before the House today forms part of that climate of success. It is part of an incremental approach to improving existing business law - making small, high priority changes to reduce some of the costs of complying with legislation.

The proposals in the Bill demonstrate the importance of planning to create a culture of expectation where nothing but success will suffice.

The strength of Maori businesses must be incorporated throughout the proposals to ensure the downstream effects of the legislation are experienced by all.

The Maori Party has raised the profile of Maori entrepreneurship many times before in this House. We have shared the results of the Global Entrepreneurship Monitor, which confirm that Maori are the third most entrepreneurial people of the world, and that about one in three Maori in the 35 to 44 age range were business entrepreneurs.

But the great sticking point has been that although Maori are great starters-up of business, only 37% of the Maori entrepreneurial start-ups survive three-and-a-half years compared to 62% in the general population.

In February this year we put on public record, our questions to the Government as to why is it that these world-class entrepreneurs are lacking the sustainable support to make the risks worthwhile.

We asked why the Government was seduced by big-talking, big spenders with big budgets from offshore; and neglecting our own indigenous entrepreneurs.

So in this respect, we welcome the initiatives presented in this Bill to increase investment in coaching, mentoring and networking projects in order to promote entrepreneurship.

Just as Peter Loughlin has done in setting up his Arohanui Victoria Trust, to spread his success with Maori designers from home, such initiatives enhance our capacity to extend manaakitanga - through the sharing of wealth, knowledge and resources.

Indeed, we are pleased to endorse information sharing as the central aspect of the bill - both to reduce business costs and administrative workload, and for business security reasons.

The Maori Party has always argued for the reduction of business compliance costs while at the same time ensuring their continued stability and success.

We strongly support the proposals to amend the Financial Reporting Act by removing unnecessary or excessive preparation, audit and filing requirements.

The move to standardise financial reporting with international standards will also have spin-off benefits for international companies doing business in Aotearoa. Such changes move toward easier, smoother and lower cost operations.

We are hopeful that such changes will support the development of indigenous vanguard companies - a concept business analyst Rod Oram raised at the recent Hui Taumata. That is originality born out of Maori “roots”, and is nurtured through astute management and smart strategies for international markets.

This House knows the spiraling global interest in authentic indigenous experiences and products. The Maori Art Meets America event held in San Francisco last August was a classic example - where the arrival at the Golden Gate Bridge of the ceremonial waka at the coming of dawn, inspired interest in up to nine million people, who were then a potential client group to watch Maori artists in ta moko and weaving, at their work.

Other Maori businesses - Tohu Wines; Cultureflow; have successfully capitalized on the indigenous edge, drawing on unique Maori concepts and culture as defined by Maori; to achieve a top quality business reputation at home and overseas.

The proposed amendments to the Companies Act outlined in this Bill, we hope will protect the quality of this reputation, through also insisting on applying rigorous quality standards to any offshore investors. We welcome the fact that Directors currently banned in Australia will now be unable to direct New Zealand Companies.

And similarly, we commend the move towards information sharing which will mean overseas registered companies don’t have to repeat file with the New Zealand registrar if they have already filed similar information elsewhere.

Finally, I want to make some comments about the proposed changes to the Friendly Societies and Credit Unions Act to enable credit unions a greater ability to grow their business without introducing unmanageable risks.

Credit Unions and Building Societies were created in low socio-economic or rural areas where their members were either socially or economically excluded from banking activities. They have a proud history amongst our people for helping to spearhead Maori businesses, when other support was hard to find. Indeed, we contend that Friendly Societies and Credit Unions grew out of the expression of local rangatiratanga.

The Nga Hau e Wha Credit Union at Pukekohe, is believed to be the first Maori credit union. The union, established in 1962 offered low-interest loans and taught budgeting, assisting Maori in ways which other lending institutions were unable to do.

The initiative was quick to spread to my own tribe, Ngati Kahungunu. Wiremu Te Tau Huata established He Toa Takitini Credit Union. In Kawerau and later throughout the Bay of Plenty, Monita Eru Delamere promoted credit unions as embracing the philosophy of pooling resources and sharing with others, which has always been the trademark of Maori business. Our success has derived from the skills and expertise we have acquired in whanau collaboration and networking.

These initiatives are still with us today. Indeed, just outside of Opotiki, the innovative enterprise of Ngai Tai iwi, in establishing the Torere Bank, has provided a solid financial infrastructure to strengthen subsequent projects.

The Maori Party sees the proposal for a common bond envisaged in this Bill, builds on this legacy of community self-sufficiency as led by tangata whenua activities.

The potential development of new community relationships through new membership could lead to new types of business relationships and collaborations that are the hallmark of our own Maori Party business/ community development policies.

As a total package, the Maori Party welcomes the initiatives proposed in the Business Law Reform Bill, and indeed, we will be looking forward to the select committee stage to learn of even more models of indigenous enterprise and entrepreneurship, which can help to lead this nation forward, to make Made In Aotearoa a prestige label across all markets.

ENDS

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