Māori entities continue to grow their putea

Leon Wijohn, Deloitte New Zealand partner.

The Māori asset base continues to grow year on year says Leon Wijohn.

Protecting and growing the putea for future generations is a key ethos in Māori business. The Māori asset base continues to grow year on year as illustrated by this year's Deloitte Top 10 Māori Business Index.

The Deloitte Top 200 celebrates the results of New Zealand's largest organisations and, as a part of this, we recognise 10 prominent Māori organisations.

Our Top 10 Māori Business Index is based on total assets as this is more reliable from publically available sources. Some large Māori organisations did not have figures publically available in time to make this year's index. These include Tauhara North No2 Trust, Wakatu and Tuaropaki. Interestingly, Ngati Whatua, with an asset base of $1b, would show an even larger group asset base if their Orakei, Kaipara and Runanga entities were added together. Some iwi, such as Kahungunu, would also make the index, based on total assets, if their organisations reported consolidated results.

When the main Deloitte Top 200 Index is resorted based on asset size (rather than revenue), the lowest asset base of a corporate on the main index is $32m. It is noteworthy that all our Top 10 Māori entities would make it onto the main index if the criteria were asset size. Ngai Tahu tops the Māori index again with $1.9b in assets. And at current growth rates, they will surpass $2 billion in assets next year. Waikato Tainui and Orakei also report total assets over the $1b mark.

We are seeing a marked increase in joint venture activity in the Māori sector. Although a number of opportunities are still centred around property and hotels, more continue to explore other sectors such as tourism, water and a range of agribusinesses. Even small iwi are expected to top $32m in assets over the next 5 years as they enter into joint ventures. This further illustrates the positive point that the Maori asset base is large and continues to get larger.

However, despite the large asset bases of Māori organisations, none of them made the main Deloitte Top 200 Index this year, which had a cut-off at $191m in revenue.

Step one for most Māori trusts and incorporations has been to regain assets lost, and then look at ways of utilising those assets better. Hence, their initial focus for many years has been on growing their asset base. Māori organisations in recent years have begun altering their strategies to include performance indicators around revenue and free cash flow. This is so they have more cash available in the future to support iwi and whanau wellbeing initiatives in particular — an example over the last year being Orākei's free health insurance for its people.

As new strategies bed in we are hopeful we will see more Māori organisations break through to the main Top 200 Index based on revenue.

Leon Wijohn is a Deloitte New Zealand partner and member of the national Māori business sector team.

Leon Wijohn is a Deloitte partner and national Maori business sector leader.