Welcome to Drumbeats, the must -listen -to podcast
which explains why Indigenous partnerships are
the key to securing successful outcomes in natural
resource and infrastructure investment in Canada.
I'm Mark McNack and my co -host Robert Brantt
are joined today by Scott Munro, CEO of the First
Nations Financial Management Board, commonly
known as FMB. We are going to explore how Indigenous
-led financial government and capacity development
are unlocking transformational investment opportunities
across Canada. FMB establishes financial management
standards that lead to the principles of sound
and transparent practices. Whether it's building
financial systems, setting performance benchmarks
for borrowing members, or supporting sister organizations
like the First Nations Financial Authority, FMB
is setting the foundation for long -term economic
growth and prosperity. Welcome, Scott Munro,
CEO of the First Nations Financial Management
Board. We're very pleased to have you here today.
Pleasure to be here. Hey, Scott. It's great to
see you. I think the last time we saw you was
in London at the end of our summit. That's right.
Our Indigenous Investment Summit, and you were
rushing back to Canada. You couldn't stay to
watch football with. With Mark and I and some
others from the summit. Yeah, unfortunately,
I didn't get the chance to partake in that part
of cultural life in London. But it was a real
pleasure to be back in that city. As we've talked
about before, I had the great fortune of working
in London earlier in my career, which was amazing.
So it has a special place in my heart. And the
conference was incredible. Being at the London
Stock Exchange was pretty amazing. And just the
quality of people in the room and the quality
of the sessions and the whole event was fantastic.
So, yeah, it was a real honor to be part of it.
Great to have you and Harold there. Yes, absolutely.
And we'll talk a bit more about the summit maybe
later. But why don't you tell us a little bit
about yourself and where you grew up and how
you ended up in the position you're in today?
Yeah, absolutely, Rob. And yeah, a little bit
about myself. So my name is Scott Monroe, and
I'm a member of the Kaskin Nation. And the Kaskin
Nation is made up of several First Nations in
northern British Columbia and southern Yukon
territory. The Kaskin Nation's territory is approximately
the same size as the United Kingdom, to give
some context to listeners. So it's a fairly big
amount of space and territory. Now, so I was
born in Whitehorse in the Yukon Territory. I've
grown up most of my life, however, down in the
Vancouver area, which is where I am today. I'm
actually on the traditional unceded lands of
the Squamish Nation on one of their reserves
here in West Vancouver. So, yeah, I have grown
up most of my life in Vancouver, as I mentioned
a few moments ago, worked in London. After going
away to school, of course, getting an undergraduate
degree at Queen's University, I came back to
Vancouver and started my what was then called
the Chartered Accountancy designation, now called
the Chartered Professional Accountant designation.
So I received that designation after passing
all the exams and trials that it involves and
went on to continue articling and gaining experience
with a major. accounting firm and I had the great
opportunity to work for a couple years while
I was in public practice with Deloitte in London
and it was fantastic. My wife and I had our first
child actually in London so our daughter was
born there, a Canadian citizen all the less but
has some ties maybe to that city in that regard.
I have been back in Vancouver since returning
from that two -year journey in London about 15
years ago or so. I kind of left public practice
a few years after coming back to Canada, just
thinking I'm looking for the next stage in my
development and looking for something new and
exciting. I did some... contracting on my own.
And while I was doing that for a few years, I
started working with the First Nation government.
I hadn't actually worked with many First Nations
previous to that. And it was a nice opportunity
to not only tap into my ancestry, but really
opened my eyes to the opportunities and the need
for professional accountants to assist in a wide
variety of ways with First Nations. That led
to an opportunity to actually join the organization
I work for right now, the First Nations Financial
Management Board. So I've been here at the FMB,
as we call it, for a better part of 13 years
or so now. I've had a few roles during that time.
I joined initially as the Director of Standards
and Certification, our team that develops financial
management standards, financial performance standards
for First Nations, and then certifies. First
Nations when they ask or make that request against
those standards. I've also acted as the Director
of Corporate Services and later the Deputy Chief
Executive Officer. And the board asked me to
begin serving as the Chief Executive Officer
back last August, I guess. So just coming up
to a year in my current role. And it's been very,
very exciting. Very exciting. I'm sure. Absolutely.
Great to be with you on the podcast again, Scott.
And I'll have to do this because they'll be expecting
of us. So another Queen's alumni. We've had a
number of them on the program at the moment,
but probably more relevant to most of our audience,
somebody else coming from the Yukon. It seems
to be the moment for connections to the Yukon
with Prime Minister Mark Carney. We're hearing
a lot about what's going on up in the north.
The Financial Management Board obviously has
a critical role. So maybe you could give some
background about what is the organization you
work for so our listeners over here in the city
understand a bit more. Yeah, and just quickly,
I wish we could lay claim to Mark Carney. He's,
I believe, from the Northwest Territory, so a
little further east, but up in the north nonetheless.
So it's great to have representation, that is
for sure. Yeah, Mark, the FMB is a very interesting
organization. It takes a few minutes maybe to
explain what we do because it's not necessarily
the easiest organization to initially understand.
But in essence, we're not a crown agency, we're
not a crown corporation, but we exist through
a statute that was passed through all party support
in our parliament. So it's a federal... piece
of legislation called the First Nations Fiscal
Management Act. And that was enacted back in
around 2006 or 2007. And that created our institution
called the FMB, as I mentioned, but it also created
several other entities at the same time, one
of which is the First Nations Finance Authority,
that I think your listeners might be very familiar
with, and the First Nations Tax Commission. More
recently, there's been a First Nations Infrastructure
Institute created under this act. So while we're
all separate entities, we work very closely.
And actually, some of our services are very complementary
and are meant to kind of interoperate between
each other. So I'll explain a little more about
what that means. The FNB's vision is around empowering
economic self -determination for First Nations.
So everything we do is anchored in assisting
First Nations achieve their vision of economic
self -determination. And that can mean many different
things, as you know, especially in a country
like Canada. So that starts with building capacity
with First Nations. And so that's simply, you
know, meeting First Nations where they're at.
Many First Nations are tremendously successful
in many activities they do. Many are really challenged,
however. Many are living in quite remote fly
-in communities, for instance, in the north or
in other areas of the country. They have real
difficulty attracting and retaining staff and
qualified staff. So to have a CPA on staff might
be really hard for these communities. So we've
come up with services that assist those smaller,
more capacity challenged. First Nations. So capacity
development is a real cornerstone of the work
that we do. What that leads to is the ability,
once a nation has put in place the foundation
of financial management capabilities, they will
often, and we certainly encourage them to enact
what's called a financial administration law
or FAL. And what the financial administration
law is, is simply a codified set of practices
that the nation agrees to do under either its
own inherent lawmaking rights or under the powers
under the Fiscal Management Act that we operate
under. The F &B's role is to simply review that
law when it's been prepared, when we offer a
lot of... some technical assistance in terms
of templates and the like. But what we do is
ensure that the nation has met the standards
that we set around that financial administration
law. And that sets the real foundation for financial
management success, we believe. And then it starts
to build on every step. It then allows the nation
a structure to operate within in terms of building
out its financial management capacity. And at
some point when the nation is ready, They will
ask us to come and review, do an independent
review or some testing, if you will, to see if
they are living up to their law, if they're doing
the things that their financial administration
law requires them to do, such as prepare monthly
and quarterly and annual financial statements,
to have a finance and audit committee review
those financial statements and other financial
information, to prepare an annual report to citizens
of the First Nation. and many other foundational
concepts. So that's one big part. Another part
of our work is supporting our sister organization
called the First Nations Finance Authority. The
Finance Authority is a wonderful success story.
They have now issued approximately $3 billion
Canadian dollars in debt on the capital markets
without any government loan guarantee in doing
so. And all that money has been raised for First
Nation governments to build infrastructure, to
build businesses. Our role in supporting the
First Nations Finance Authority is to ensure
that borrowing members meet certain financial
performance tests or financial performance standards
that we've set. And most do, not all of them,
but I'd say the majority of those that apply
meet those rigorous standards. So we will issue
what's called a financial performance certificate.
And it's that certificate, financial performance
certificate, that makes a First Nation eligible
to go borrow from the First Nations Finance Authority.
And so as you can tell from, you know, over $3
billion now, many First Nations have chosen to
do that successfully. So we're very proud of
our role in facilitating access to capital. That
was really the genesis of this legislation. A
big part of it anyways was seeing such a gap
in how First Nations... or the limitations that
First Nations had in access to capital. So, yeah,
just to summarize, really, it's capacity building,
working in the community with First Nations at
their pace and at their request. I should emphasize
that all our services are entirely optional.
There's no requirement to work with the FMB,
but most choose to. We now have about 65, 67
% of all First Nations in Canada choosing voluntarily.
to work with us, which is phenomenal. That's
impressive. And do you have coverage, Scott,
all across and up and down the country? We do,
Rob. We're very proud of that. You know, our
history is that we were established and our head
office for quite some time was only in BC. And
so, you know, we have a lot of clients in BC
and it took some time to sort of gain the trust
of First Nations in other parts of the country.
A lot of traveling, a lot of air miles. You know
what that's about. But we have now offices in
Winnipeg and Ottawa and in Montreal. And we have
a lot of staff that work remotely in different
parts of the country as well to make it easier
to be within with communities. So, yeah, we've
we've grown a lot and we're now thinking of new
ideas as well as we continue to grow. Sounds
like your core service is providing the, as you
said, the capacity building and the financial
framework. uh for first nations to go out and
do uh do what they want to do are you only working
with members who want to be certified is that
or are you doing different things with different
nations who may not be ready for certification
yet well it's not i wouldn't say we're only working
with those that are interested in certification
We will work with nations that may not be interested
in certification. They may, for example, want
to use our services to qualify for a 10 -year
grant that's now offered by Indigenous Services
Canada. So we made the decision when asked by
the Minister of Indigenous Services that time,
back in 2018, I think it was, or 2019, to be
a service provider, an administrative provider
in terms of testing the eligibility. and determining
whether First Nations that opt into that grant
qualify or meet the eligibility criteria. So
that's one example. And the nation doesn't need
to be certified to use that service of ours.
Some nations are just looking for capacity development
support at this stage. Maybe in time they'll
look to borrow and want to be certified, but
that's entirely their decision. It's our role
is simply to make sure they're informed of what
the benefits might be of being certified. We
really will work with nations on anything of
their choosing as long as it's in our mandate,
which is pretty broad. Pretty broad, and that's
the core service. But what about some of the
other offerings and initiatives? I know FMB is
at the forefront of a lot of national initiatives.
One was recently announced, the First Nations
Procurement Authority. And I know that's brand
new, but what can you tell us about that new
authority? Yeah, that's an exciting example.
What it is really is an example of national Indigenous
organizations, the FMB being one of several,
really using their collective ability to see
what aggregated sort of solutions might be needed
to serve. First Nations and their citizens in
more effective ways. So it's early days on the
procurement concept, but we are a participant
in that initiative. And as I think your listeners
will appreciate, we're entering into a very different
economic situation within Canada. We have a new
industrial policy that is being developed. at
warp speed. And First Nations, they will need
to be at the center of many of these development
plans and new forms of GDP growth. So procurement
will be a big part of that, especially as we
are looking internally to develop more of our
products and services and to sustain our economy,
given the tariff threats and tariffs that we're
subject to right now from the United States.
Yeah, the procurement idea might be something
that becomes very, very important. The FMB has
also worked on some other interesting sort of
pilot projects or new initiatives, one of which
is acting as what we're calling an economic regulator.
We're taking on a bit of a regulatory role. And
this is for what's called the First Nations.
Water Authority, Atlantic First Nations Water
Authority. So a group of Mi 'kmaq First Nations,
primarily Mi 'kmaq First Nations in Atlantic
Canada, have decided to aggregate their water
and wastewater services into a not -for -profit
service delivery entity called the Atlantic First
Nations Water Authority. And we've been asked
and we've accepted the opportunity to provide
some independent... kind of prudential sort of
oversight in terms of capital plans, operating
budgets, and of course supporting the initiative,
but doing it from a bit of a regulatory. So it's
a bit of a pilot project seeing how maybe our
work as a financial institution can assist and
empower these sorts of new innovative service
delivery organizations that First Nations are
creating for themselves. Another example might
be creating what we're calling the shared services
or support services team within FMB. And that
consists of offering services at no cost to First
Nations, a little bit of extra bench strength,
I call it. Kind of like adding some part -time
or external accounting or bookkeeping support
or maybe HR support. And I'm thinking, you know,
it can be as basic as helping and assisting with
month -end account reconciliations or bookkeeping,
bank reconciliations, just things that take some
time. Nations might, like I said earlier, might
not have the right people at a particular time.
And so we're offering some of those services
just to add a bit of bench strength to nations
when they need it. So that seems to be very well
received. We've had a lot of interest in those
services. And there's a few others as well. Scott,
you've worked over in London, so you already
know what they're looking for because you were
over here looking at those similar opportunities
and some of the different roles you had. And
you've been at the summit for the past couple
of years, which has been absolutely great. That's
great. How would either a corporate with a subsidiary
in Canada or looking at coming into the country
or perhaps some of those who are involved in
the capital markets who are dealing? with your
sister organization or other indigenous led organizations
in Canada, where would they come across you in
their discussions or would they just kind of
sense you in behind the indigenous nations and
organizations they're dealing with? Yeah, it's
an interesting question, Mark. I'm not sure if
they would directly come in connection to us.
You know, it's something we're thinking about
knowing. Having been at the summit now a couple
of times, as you mentioned, we're seeing the
obvious growing interest by investors in London
and elsewhere around the world. And so maybe
there is a bit of a role for the F &B to play
in some regards, but it's more of a facilitator
role than anything else. At the end of the day,
we don't stand between opportunities and First
Nations. We're not there to gatekeep or do anything
other than... support the nation from a financial
management perspective. So it's a fair question,
but I don't know if there'd be any direct contact
other than understanding maybe the context of
how First Nations are operating in Canada, which
is an important bit of information, I think,
for someone coming from outside of Canada to
understand that. I mean, that would be certainly
one role that we would happily play. Any deals?
Scott, that you're most proud of or want to highlight,
where nations that you've supported or assisted
and then have gone on to raise funds in the market
to do interesting projects? Yeah, there are several
in a fast -growing list of really amazing successes.
And again, we don't take credit for them, but
we're proud of the role that we've played. A,
helping maybe build the capacity, but also provide
access to capital through the First Nations Finance
Authority. So, yes, the one that's probably best
known in Canada is out on the East Coast in Mi
'kmaq territory. Member to First Nation, along
with several other communities in that region,
partnered with a company here in Richmond, B
.C., to acquire the largest integrated... seafood
company called Clearwater Seafood. And so what
it ends up looking like is the First Nations
own 50 % of this really, really large seafood
company. And it gave them, it basically allowed
nations to monetize their fishing permits, their
lobster permits, things that they already had,
but that way they were able to bring those into
the commercial deal. And suddenly you have a
very... interesting combination of forces that
allowed that transaction to go ahead. So that
was, I think, a billion dollar deal. So one of
the larger ones at the time. And those nations
have really prospered. And it's an example of
First Nations moving away from managing poverty
to managing wealth, which is something that we're
really starting to see now, finally. And it is
in part due to the tools available. So member
two and the other nations that borrowed to make
that acquisition, they had to get certified by
the FMB. And they came to us one day and said,
we've got this deal. It's time sensitive. How
can you help us? And we absolutely said yes.
And we did everything we needed to do and worked.
exactly as fast as we needed to, to get those
certifications done and to work with the First
Nations Finance Authority to make that. I didn't
appreciate that. They weren't certified at the
time. That's right. And they had to as part of
that transaction. Yes. Interesting. So yeah,
it was an exciting one. And who put the onus
on them to be certified? Yeah, I guess it was,
it's like I mentioned earlier, it's a condition
of gaining access to the First Nations Finance
Authority. So each participating borrowing member
had to get a financial performance certificate.
But really, certification, for the most part,
especially our financial management certification,
Mark, is driven by the need expressed by the
elected officials of the nation, the governing
body, around good management. They want to demonstrate
to their citizens that they're meeting best practices.
that they are committed to accountability and
transparency. Those are cornerstone principles
in our financial administration law and in our
financial management system standards. Really
comes from that is the motivating factor I find,
which is pretty great. Capital is great and that's
obviously a motivating factor when it comes to
a transaction, but the long -term health and
success of a community is going to be based on
broader standards than that. Yes. Absolutely.
Such an important role you're playing. Scott
and the FMB is playing as more and more wealth
hopefully gets transferred to First Nations as
part of economic reconciliation. And as First
Nations participate in the economic development
activities in and around their territories, managing
that money and that wealth. It's very, very important,
obviously. I think just to add to that with what's
going on with Canada and the tariffs, as you
alluded to, and we have a new government and
it's a new direction for the country. That's
right. And First Nations have to play a central
role. And they're all in Ottawa making sure their
voices are heard and being listened to and contributing.
And I think if you look back even 10 years. If
this had happened 10 years ago, I'm not sure
whether the Indigenous people were as in strong
a position as they are today. Every year gets
stronger and stronger as there's a whole group
of both yourselves and younger people now are
coming through who are in senior positions, not
in Indigenous -owned businesses, but non -Indigenous
businesses like McCarthy and others. It just
is a real game -changer. So I think somebody
outside who has... who hasn't really been in
Canada too often, may have some connection because
we're still shaped to a certain extent by our
southern neighbor when they think of North America.
And if you're an Indigenous person in the US,
right, I think you're having a different experience
now if you're an Indigenous person in Canada.
Yes. And I think that's really positive for Canada.
A lot to do and a long way to go. But it's exciting.
It is. It really is. Canada has actually, First
Nations in Canada have a lot to be very proud
of. You know, there's no denying that the very
dark past that First Nations and other Indigenous
people have had to live through in this country.
And this country has, you know, begun to and
has acknowledged those wrongs and the harmful
effects of colonization and residential schools.
Apologies have been made. Commissions have issued
reports. But ultimately, we need First Nations
communities to thrive. We need their economies
to thrive for the difference in socioeconomic
conditions to improve. And that's really what
we're looking for. But that's starting to happen
now. Does that mean there are new challenges
ahead? Absolutely. Managing wealth is going to
be a huge new challenge for a lot of communities.
It can be disastrous, bringing enormous wealth
suddenly or quickly to any community, Indigenous
or otherwise. So we're thinking about other ways
that we can support nations in this era of economic
prosperity and how we know First Nations will
be involved in so many of the... big economic
activity in this country. Rightfully so. I think
it's their time to shine. But they need the tools.
They need the financial management skill sets
and capabilities. And we're certainly here to
assist and support. What else is then on your
radar screen? Scott, you've got, you talked about
the core services and financial management certification,
some regulatory initiatives, the... Procurement
Authority. Yes. If that wasn't enough, what else
are you working on? Oh, just a little thing called
an Indigenous Development Bank. Yeah, small thing.
In London, too. That's right. Level of understatement.
That's right. We, along with others in the First
Nation community and other partners, including
First Nations Finance Authority and NACA, are
collaborating, collectively working on a business
plan and business model on what we're calling
an Indigenous Development Finance Organization.
It's kind of a working title. I referred to a
development bank. That's what you see when you
read our roadmap project that surfaced this idea,
this concept. The premise being we feel there's
some substantial gaps in the financial marketplace.
for access to capital. And I'm specifically thinking
about risk capital. The finance authority, like
I said, phenomenally successful, and they will
continue to be successful. They provide capital
that is secured by existing revenue streams.
That's the way they are designed. That's the
way they're set up. That's their risk model.
And it works really well. But what happens if
you don't have existing revenue streams? What
happens if you need the money to buy equity into
a project? First Nations governments don't have
a balance sheet yet. They don't have 150 years,
200 years of colonial economic expansion to benefit
from. So we believe, along with our colleagues
at Finance Authority and NACA, that there is
a compelling argument to create a new Indigenous
-led development finance organization of some
sort. Would it disrupt the marketplace a little
bit? Yeah, it probably will. But we don't believe
it needs to compete against or limit anyone's
opportunities. In fact, we think it could be
very complementary because it would be a public
sector -led type initiative and building on long
-standing existing development bank models that
Canada participates in and many other nations
around the world participate in, including the
UK. Scott, how would this differ from, say, the
Canada Infrastructure Bank? what they're doing
now? Yeah, that's a great question. I see it
being complementary to some of the existing institutions,
including the CIB. So could it simply be a service
provider in some cases? That's very possible.
What I'm thinking of is helping structure deals,
helping work, again, back to capacity development,
but in a very focused sort of corporate finance
role. Maybe the IDFO, as we're calling it, wouldn't
necessarily be a capital provider. In some cases,
it might be. In some cases, they might partner
with the CIB or with, I don't know, another financial
institution in Canada. But I also believe there's
opportunity to blend different forms of capital
in an institution like this. And there's not
really the mechanism in Canada to create that
environment. And it's not really naturally happening
in the private sector today, I would argue. So
I think there's a bit of a gap in sort of the
$5 million to probably $100 million deal size.
I think in that area, I don't think First Nations
are well served. You know, banks, the big banks
obviously get very interested once you get into
the hundreds of millions of dollars and onwards.
But maybe at the very high end, too, when we're
talking about billions of dollars, which we will
be and we are. We're talking about major projects,
energy corridors. Maybe you need something like
this to form a bit of a syndicate or participate
in some way. Maybe it's drawing down on the various
government guarantees that both the federal government
has, provincial governments and the like, bringing
new players. I think there's an ESG element to
this as well, a sustainability side of things
to this that could bring in that. area of investor
to the picture. So I think it could be a focal
point to bring in and crowd in capital rather
than to compete against, like I said, any existing
player. Well, that sounds like a great initiative.
And as you said, it's a different ballgame because
there's these new opportunities in front and
capital doesn't come always with a guarantee.
So how do you participate in those markets? It
sounds like a disruption, which is always welcome
in most markets, unless you're the person or
organization being disrupted. Apart from that,
it's a great idea, right? Yeah, that's right.
We're working really hard, Mark, to really identify
how this would really complement existing financial,
especially Indigenous financial players, which
we have healthy, lots of respect for and want
to see succeed. But it's about filling gaps and
filling missing needs or meeting needs that aren't
yet being met in the market today. Great. So
one of the things we've been talking to you and
we haven't had an opportunity to ask about that
mask. Yeah. And it's Indigenous History Month
in Canada. It's June. This is Indigenous History
Month, and I know this isn't just about history.
This is about the present as well. But can you
tell us a little bit about that? I'm sure. Yeah,
well, it's really it's our founding chair, Harold
Calla, who you both know and was at the summit
this year. It's part of his personal collection.
Harold is a member of the Squamish Nation and
was the founder of this. organization and influential
driving the legislation as well. He's a pretty
avid collector of different pieces of artwork.
So we're seeing a pretty special piece here that's
on display where I am today. So, yeah, we're
very lucky in our hallways. We have some amazing
artwork and paintings from Indigenous artists,
both here locally and some that we've collected
on our different trips to communities. That's
part of what's so amazing working here is having
the vibrancy and getting to see the culture around
every corner of our clients. So, yeah, thanks
for noticing that. You're very lucky to experience
that every day. And as you can see now, the sun
is setting in London where I am today. And of
course, so when the sun sets in London, it decides
to come out to remind you, you know, in the cloudy
day. that actually the sun was there. So now
it appears. Anyway, so it has been absolutely
great, Scott, to have you on the - With us today
to talk. We've appreciated your support at the
past two summits. We look forward to seeing you
again next April 8th. And Rob, you're traveling
across Canada. I'm not sure if you're in Europe
or Toronto or in - BC down the street from Scott.
Today, I happen to be in the Toronto office.
You have one of those rare opportunities. And
thank you again for taking the time to remind
us of the important work that FMB is doing. And
so thanks for your leadership and appreciate
all you do and look forward to welcoming you
back to London next year. I hope you'll take
time to take in a... Football game, even if it's
Chelsea again next year. Well, I would, like
I said last time, I had the pleasure of joining
you, Rob. You'll have to forgive me if I don't
cheer wildly for the home team. My allegiances
are slightly north of Chelsea with Arsenal. But
anyways, regardless of getting to enjoy another
match with you. It'd be a real pleasure to meet
up again. And I want to really thank you, Mark
and Rob, for your ongoing support, for driving
a really important conversation with your Drumbeats
podcast, with the summit that you co -host and
do. It's very meaningful work. It's creating
new opportunities, more visibility for First
Nations people so that we're seen and that we're
visible to investors in markets like in London.
It's fantastic. I really appreciate the opportunity
to be on your podcast. Well, thank you very much.
Yeah. Absolutely. Thank you. And as you were
in London, cheers. Yeah, that's right. Thank
you to Scott Monroe for sharing his insights
with us. And thank you for viewing and listening.
Be sure to share, subscribe and leave a review
on your favorite podcast channel. Thanks for
listening to Drumbeats. Until next time.