Federal Government Tightens Rules Around Indigenous Procurement
Global News recently conducted a significant investigation into the Canadian government’s awarding of billions of dollars worth of contracts to Indigenous businesses which were misrepresenting their Indigenous ownership.
The allegations raised were that the Canadian government in many cases did not get proper verification from these businesses, which in some cases were deliberately misrepresenting themselves to heighten their chances of winning a federal government contract.
As a legitimately 100% Indigenous-owned business, we find the practice of Indigenous misrepresentation abhorrent and welcome further measures on the part of the government to verify the claims of Indigenous businesses.
Anatomy of the Indigenous misrepresentation scandal
The Procurement Strategy for Indigenous Business (PSIB) is a federal government program administered through Indigenous Services Canada (ISC). The program requires that a minimum of 5% of contracts for each federal department are awarded to Indigenous businesses, among other measures.
The problem arose with the honour system which ISC historically used prior to 2022. If a business signed an attestation that it was Indigenous, it could be listed as an Indigenous business for purposes of the program. In 2022, this was tightened to requiring status cards or other documentation. However, other schemes were uncovered including paying an Indigenous person to represent themselves as the main shareholder in the business; PSIB requires 51% Indigenous ownership.
Indigenous business owners have known about the abuse of the system for years; frequently they will see a competing company bid for a contract within their industry sector, and they would have no knowledge of who that business owner was. Given the small percentage of Indigenous-owned businesses, it is highly unlikely that a founder in the same industry would be unknown to a fellow Indigenous entrepreneur.
Global News investigation turns up large contract awards to unverifiable businesses
Global estimated the top ten Indigenous businesses by contract award size. Out of those ten, five had unconfirmable Indigenous credentials (to Global) and one of the five had been removed from the federal Indigenous Business Directory.
All of the top ten businesses work in the IT industry. While it is true that the other four businesses may just not want to have been scrutinized by Global, this exercise did call out one of the businesses as legitimately non-Indigenous. Those findings were largely due to that business’ involvement in the ArriveCan scandal, the story which kicked off investigations both at the government level and this new investigative piece from Global.
NATIONS has verifiable 100% Indigenous ownership
At NATIONS, we are proud to be a 100% Indigenous-owned company, offering not just best-in-class translation and interpretation services, but also a deep commitment to transparency and authenticity. Our Indigenous bona fides are verified through our membership with the Canadian Council for Indigenous Business, which has rigorous requirements to verify the validity of Indigenous ownership. In addition, we are listed as an Indigenous business in the Government of Canada’s Indigenous Business Directory.
Our verifiable Indigenous status ensures that your investments in Indigenous partnerships are aligned with your priorities in ESG, DEI, and reconciliation.
