How Mark Podlasly was the right person in the right place at the right time for his community

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It’s not often the fabled right-person-right-place-right-time triad lines up just so, but when it does, something special usually happens. It was back in 2008 that Mark Podlasly, a member of Nlaka’pamux Nation, born and raised in British Columbia, returned home after some years away. He brought with him a Harvard degree in public administration, years of experience in natural gas and infrastructure development in Korea, Japan, China, Europe and the United States, and a desire to contribute meaningfully to his community. It just so happened that very soon, Podlasly’s community needed someone with exactly his expertise. First Nations groups were approaching an inflection point in their ability to participate in infrastructure projects. There were hurdles to be overcome, and they needed guidance. After working with the B.C. First Nations Energy and Mining Council, Podlasly began helping the now-late Niilo Edwards at what became the First Nations Major Projects Coalition. Beginning with 11 First Nations, the FNMPC now represents 186. And that number keeps growing, as do the opportunities amid a surge in Canadian infrastructure investment. Now the coalition’s CEO, Podlasly spoke to us from his home on the Musqueam Reserve, as he prepared for the FNMPC’s annual conference.

How did you first get involved in the coalition? I’ve heard you moved back to B.C. at a moment when there were 14 LNG proposals flying around, and you were asked to sit in on one of the meetings.

Yes, it was a meeting in northern B.C., and the First Nations were being talked over by the technical teams from the pipeline companies. After the meeting, I turned to the Chiefs and said, “We need an executive education program for our own people that lays out what we’re being asked to participate in.” And I said I’d do it because I’d been doing a lot of work with Harvard professors who ran executive education programs. So I knew what was needed. But it had to be targeted to our own people. We called it “World Energy Markets: LNG for your Granny.” It was very visual, and it had explanations and diagrams. “This is the world energy market. This is upstream, midstream, downstream. Here’s the profit that happens in each section. This is what’s possible. This is what’s not possible.” I gave it to a group of 400 First Nations leaders in Fort Nelson. And the lights went on. People got it. And there was a huge uptake. I ended up giving that presentation to something like 40 communities. Around the same time, for one of these LNG proposals, 11 Nations had an opportunity to co-invest 30% in a natural gas pipeline. But they couldn’t get the capital for it. Because as First Nation citizens, we don’t own anything. So you see how those two things connect. Suddenly going, “Aha, here’s what’s possible. But here’s the problem we’ve got. How do we get past all of this? We need a coalition.”

When you and Niilo Edwards started the coalition, you were told it was audacious. Why audacious?

First, nobody had ever thought about Indigenous people taking large equity positions in projects. It’s just not something that was ever done. And second, it was audacious because as First Nations, we are not organized as corporate structures. Our Nations are organized as band councils or non-profit societies, something on the social side, not so much the corporate side. We had to convince Nations that we could do this.

When you’re helping a group with a project, is a financial deal always the goal?

There’s two ways to go. We were founded on the question: How do you take equity in a project? But impact benefit agreements are also a part of negotiations. Those could include employment targets, training, procurement opportunities. That’s different. We try to focus on the economic side. Equity is not for every project. It’s not for every First Nation. If you have a project like an electric transmission line, it’s a regulated rate of return. You know it’s going to be 9.25% for 20 years. There’s an off-take agreement. There’s a well-known operator to partner with. That’s easier to do equity on because you know the revenue stream. Mining is tougher, because we don’t know what copper is going to be priced at tomorrow, never mind 10 or 15 years later. In that situation, it might be a revenue-sharing deal. Perhaps it’ll be enhanced procurement. But we will advise on that. There’s a reason why 85% of the projects we get involved in are in energy: because it’s semi-regulated or regulated.

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When a First Nation wants to take an equity position, where does the capital come from?

Some Nations have their own capital. In Canada right now, there’s roughly $80 billion in funds held by Indigenous people in different pockets across the country. That’s come from treaty settlements or court cases or revenue sharing or something. That’s one. Second, the First Nations Financial Authority helps Indigenous Nations raise capital. They sell bonds in Toronto and New York, and they do that on future revenue streams and bring the money to present day. Another source of capital is the loan guarantee programs that are in place. The federal government’s loan guarantee program is $10 billion at the moment. That will be expanded if needed. They guarantee that the Nations are good for the money, and then the Nations work with investment firms or capital firms.

You’ve watched the way companies deal with First Nations groups for a while now. How has the dynamic changed?

When I first got back from Harvard, companies were not so keen. They saw the First Nations as a major risk. They also saw First Nations as a government responsibility. But over time, a couple of things have happened. There have been court challenges and court decisions, which have strengthened the hand of the First Nations in negotiations. Originally we were seen as a check-box exercise. You just need to consult, prove that you consulted, and then you can proceed. The government would issue the permit. But then there had to be “meaningful” consultation. That was the first clarification. Then the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) came along, and that’s been incorporated provincially in B.C., federally at the national level. And it says “free, prior and informed consent” is required. We’ve gone from consultation to consent. Then ESG capital, which is no longer referred to as much given what’s going on in the U.S., but ESG investors wanted to see where their money was going. “Is this being done right? Are the local people being harmed by this? Is there benefit coming to them from our investment?” And the other part was First Nations starting to see, “Wait a minute, there’s examples of 50% ownership over here, and 10% over there.” So it starts to snowball.

Even now, there are probably some companies that are more receptive than others. What’s typical about the companies that want to engage?

The ones that want to engage are the ones that see having a First Nations partner as a competitive advantage. If you’re an independent power producer (IPP), and you’re going into an area competing against other IPP companies, what happens if you secure partnerships with all the Indigenous capacity in that territory? You’ve got the contractors. You know who the Indigenous parties are who could work on everything from land preparation to the employment to the environmental studies. And you lock them all up. What happens to their competitors when they try and make a bid? It’ll take them 15 to 20 years to get it that far. The progressive companies have started to see that. The second thing is, if you as a company have an Indigenous co-investor, you have an Indigenous co-proponent. And if you have an Indigenous co-proponent, by default, you’ve got consent. And third, Indigenous people increasingly will bring in capital of some form. Even a loan guarantee is a form of capital. Very few of these projects are financed 100% by the proponent. So you’ve got a capital partner who de-risks the project.

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There’s been such a huge rise in the number of projects and proposals that Indigenous communities are being asked to consider, they’re experiencing something called “consultation fatigue.” How big a problem is that?

I’ll use my own band as an example. We are about 300 people. Only 65 people live on reserve. All of a sudden in an office that’s servicing that tiny community will come a proponent. They’ll bring in the volumes. “Here’s the environmental review, we’d like your comment on this please.” And then the railway comes in. “We’re doing a double tracking in this area along the fish line. Here it is, binders and boxes. Here you go.” And they just keep piling up. The band offices are small. There might be four people working there. All of a sudden, they’re expected to consult or to comment and give technical input. And there’s a timeline on these things. You can’t just sit on them. That’s the consultation fatigue, and that’s a capacity issue for the Nations. That’s why we get called in a lot. We take the pressure off them in some ways.

I think you’ve mentioned elsewhere that the perception still exists among some potential investors and partners that projects can’t be completed in Canada because of Indigenous groups. Why isn’t that a justifiable view?

First of all, the coalition is nearly 200 First Nations. We are nearly a third of all the Nations in this country. They want to be involved in projects that are smart. They define smart as environmentally and economically inclusive. So that’s the biggest challenge to that. I have been on trade missions to Japan, to Europe. The Japanese would say the same thing you said. The Germans would say the same thing: “We invested in Canada in the 1980s, and we got burned because we ended up in these court battles with the Indigenous people. So why should we come back now?” And we’re like, “Talk to them. As long as you’re aligned with the values of the Nation, you are fine.” Not all First Nations want development. We’re not going to give you a Pollyanna view of this. But there are enough, one-third, who are.

When the federal and Alberta governments recently proposed a pipeline to the B.C. coast, the Heiltsuk Nation said in part, “We will never allow oil tankers on our coast, and this pipeline project will never happen.” That’s a clear example of a First Nation impeding a major project.

You’re right, there are Nations on the coast that have come out very politically. But there are other Nations along the interior of B.C. up toward Alberta that are not vocal against the project. They’re still waiting to see what happens. There is the possibility of that pipe still happening, depending on the deal that’s struck among the Nations. I would pose back to you, what do you think would happen if it was a First Nations–led group that decided, “Hey, let’s do an oil pipeline.” That is the next level of this. Whether that’s going to happen around that B.C.-Alberta pipe, we don’t know. But that’s how I would see this thing gaining acceptance across all of the province, not just the coast. If it’s in the interests of the Nations writ large, there’s a better possibility of it happening.

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Then there’s the question of whether Indigenous consent is actually required. Article 32 of the UNDRIP requires “free, prior and informed consent.” But there’s debate over whether this gives First Nations a veto. The federal government says no. How do you parse it?

The coalition’s response on this is, whether it’s a veto or it’s not a veto, if you get into a legal fight over that definition on a certain project, you’re looking at a 20- to 25-year court battle as it works its way through the system to the Supreme Court. Do you, Mr. Investor, have 25 years of patient capital to wait while that’s being decided? Probably not. So how about you sidestep the whole thing, take on a co-investor who’s an Indigenous party, get them involved so there’s a reason for them to support your initiative, and let some other project pay for that legal cost to figure that out? That’s our response. Equity is the purest form of consent.

You could be in a corporate C-suite somewhere, making millions of dollars a year. Why are you doing this non-profit work?

When I got into Harvard, I was on Cloud 9. I was in my 20s. I went home and talked to our Grand Chief, who was a huge supporter of mine. He said, “Great accomplishment. Do you think you got there alone? Who taught you the love of learning? Oh, your mother. And who taught her how to read? Oh, your grandmother. Who took care of your grandmother when influenza came here and killed half of our population? Oh, the community. And who took care of those people when the Indian Act came along and forbade us from going off reserve to fish and collect food? You didn’t get there alone, Mark. It took all of us to get you into that seat. And now you have an obligation to pass that knowledge on to those who come next, like everyone has given to you.” I’ve never forgotten that. So I see this as an obligation to contribute. There is no such thing as a self-made person in this world. You are at the top of a chain of people, and there’s a chain that comes after you. That’s Seven Generation thinking, which is very Indigenous. The sense that you make decisions for the future generations just as those past people have made decisions for you.