Pouwhakarae Report

Tēnā tātou e te whānau

On behalf of my fellow trustees, it’s my privilege to present this Pouwhakarae Report for Te Korowai o Ngāruahine Trust Group (‘the Group’) for the financial year 1 April 2021 to 31 March 2022.

We are facing continued challenges to do with our whenua – acknowledging that whenua is essential for identity, whakapapa, connection, and well-being outcomes - which is why we’ve dedicated the theme of this Annual Report to ‘Whenua’ and our kaupapa priority Toitū Te Whenua.

In last year’s Annual Report, I outlined our intent to improve on our role as an enabler for our Hapū and iwi aspirations, and I’m proud to report that we’ve made significant inroads to achieving that.

The practice of this Board is to set expectations of management for delivery of service at the beginning of each year, and to establish some key goals to aim for, as below:

• Endorse our first 5-year strategy for implementation

• Lift operational performance and delivery of initiatives and direct benefits to our people

• Improve board capability and performance

• Overhaul the uri beneficiary register and

• Improve the flow of information between Te Korowai and Hapū, in particular, Hapū updates on activities, interests, concerns and kaupapa to be raised with Te Korowai.

Whilst we were focused on these goals, we faced significant and continued disruptions throughout the year due to Covid-19, and we managed three changes in our executive leadership.

Despite this, it turned out to be the most significant period of operational improvement, growth and performance that Te Korowai has experienced in a single financial year to date. I put this down to these things: a strong vision and board culture, talented management leadership, investing in the right areas, engaging the right advisors, and our steadfast commitment as kaupapa kaimahi and leaders to reaching higher for our people.

The Board wants to especially thank Emma Gardiner as our interim Pouhautū and our kaimahi over this period, who have worked relentlessly to improve the way we serve our people.

Enabling Hapū – Toitū Te Whenua

During the year, we revisited an old board decision that said we would not purchase deferred selection properties (DSP) negotiated in the Ngāruahine Treaty settlement with the Crown.

After wide consultation across the iwi, our people told us that returning whenua under Hapū ownership was paramount to building-back so we made reacquiring whenua our mission. The Board directed Emma Gardiner to find a way that was fair and equitable and as a result, the Ngāruahine Whenua Reacquisition Strategy - Toitū Te Whenua was created. With the cooperation of Te Kīwai Mauī o Ngāruahine Limited, this strategy comprises three key components:

• Te Korowai-Hapū partnership to support the purchase of whenua;

• Approval of a Fund to support whenua development and enterprise by Hapū (beginning 2023-24); and

• A Hapū distribution policy review, that resulted in an increase to $100k per annum (beginning 2023-24) and an increase of 2% year on year.

This strategy is a first of its kind and sets a precedence on how Post Settlement Governance Entities can enable and support Hapū development.

In addition to the DSP, Te Korowai negotiated the return of two right of first refusal properties (RFR) from South Taranaki District Council (STDC) - Te Ngutu o te Manu (Site B) and Kaipi St, Manaia. The properties were returned for $1. This outcome was made possible by the early Treaty Settlement mahi by Aunty Daisy Noble and the leadership by our Hapū, Ngāti Manuhiakai and Ngāti Tū. Te Korowai is working actively with Hapū to identify how we can ensure Hapū leadership in the governance of the whenua.

Te Ara Toiroa: Ngāruahine Procurement Strategy

One of the most exciting achievements this year has been the development of a new and innovative Te Ara Toiroa: Ngāruahine Procurement Strategy. This strategy ensures our mahi is by-Ngāruahine and for-Ngāruahine – where we govern, we manage, and we deliver. Wherever possible we want to employ our own people and contract our Ngāruahine businesses (including in-laws). We want our own people on apprenticeships, and our people to be reflected across the supply chain that supports our current and future developments.

Te Korowai is going through a growth phase, where our people are at the helm, and we are unapologetically Ngāruahine focused. One example of us demonstrating our Te Ara Toiroa strategy in action is the appointment of Te Aorangi Dillon as Te Tumu Whakarae / Chief Executive (what about that incredible haka pōwhiri! It was a special day for us all). Other examples include:

• The apprenticeships created for two uri on the construction project for the new Te Rere o Kapuni development, and

• The new opportunities we are creating for our Ngāruahine tradespeople to express an interest in future work coming via our own impact investment projects.

This year we are forecasting an estimated $55m of new development over the next four years, and we want maximum benefits to go to our people first. This strategy is a direct response to what we heard from our uri on the things that matter.

(FY21: $4.27m)Our Tumu Whakarae Report (Pg.10) and Annual Highlights (Pg.12) sections further detail the achievements since the development of Te Ara Toiroa.

Our Financial Results for 2021-2022

Despite Covid-19, we had a great financial year. We did well against the sharemarket and our property assets valued up. Having a diverse investment portfolio meant we were able to manage risk well.

In 2020-21, the Group received a total income of $4.27m and had expenses of $2.85m resulting in a profit of $1.42m. By comparison, in 2021-22 the Group received total income of $7.54m and had expenses of $4.17m creating a profit of $3.37m before tax. This is due to ‘Other Income’, resulting in an increase from $0.29m to $4.25m, and a $3.96m positive variance. Other income includes government and other third-party fundraising to support value-add Te Korowai initiatives. Key funding included; Covid-19 response, Toi Foundation, Creative NZ and Ministry of Education. Thank you to our Kaimahi for their contribution to writing successful applications.

The total comprehensive income for 2021/22 was $11.27m which contributed to the growing total asset base of $111m to 31 March 2022. This is a $0.5m increase in comprehensive income on the previous financial year and the greatest increase since the establishment of the Trust. Since we settled with the Crown in 2014, our overall assets have grown in value by $42m (as at 31 March 2022).

However, the message we are hearing loud and clear from our directors and advisors is caution for the coming year. Don’t expect the same level of performance, as the market catches up with the after-effects of the pandemic.

I want to give a special thanks to Hinerangi Raumati- Tu’ua who has been the Chair of Te Kīwai Mauī since its inception. It’s been a privilege to experience Hinerangi’s inspired governance leadership as she has chaired multiple investment meetings for us, ushered new opportunities our way, asked the hard questions, held people to account, made introductions, explained complex matters in simple terms – and ensured Mauī has delivered each year to Te Korowai board expectations. Hinerangi is a great role model particularly for wāhine Māori in this field, and we were fortunate to have her at the helm during this early phase of Mauī. Hinerangi retired from the Mauī chair role in June 2022, leaving a great legacy for us to build on. We wish Hinerangi all the best as she focuses on her new directorships.

Thank you to our very clever relations who are our independent directors Taari Nicholas and Dion Maaka, along with our contracted Investment Manager Jim Jessep (Koau Capital Partners Ltd), for your part that has led to a great commercial performance. This year had a significant focus on Impact Investments and in particular finalising the design of Te Rere o Kapuni Lodge, with input from uri, artists and led by our cultural advisors Philip and Puhi Nuku. Ka nui te mihi ki a koutou katoa.

This mahi is further explained in the Pouwhakarae report for Te Kīwai Mauī o Ngāruahine Limited on pages 29-34.

Holding Ourselves to Account

With our above goals in mind, the governance work programme this year was also focussed on the review and development of policy and compliance. We heard the concerns raised at previous AGMs surrounding our iwi register, elections, and the management of private information. We saw this as a key policy priority, and as a result, we finalised the development of a Privacy policy, Iwi register policy and reviewed the suite of existing governance and management policies to a much more satisfactory standard.

Te Rua o Te Moko

Key to this mahi was the advice and guidance that we received from our governance sub-committees, in particular our independent members and Chartered Accountants from our Audit and Risk committee (Te Ohu Arotake) - Phillipa Wilson and Neil Taylor; and our longstanding independent HR Advisor David Patten from our CE-Organisation Performance committee (Te Arohaehae). The capability of this latter committee is also now complemented with a new independent HR expert and uri of Ngāruahine, Lara Robertson (Ngāti Tū).

A special thanks to Neil Taylor, who has been with us since the inception of Te Korowai and held key advisory roles for the mandated entity responsible for Treaty negotiations. Neil’s work over the years has ensured that we work in a way that is tika and pono - we have valued your contribution to Te Korowai - you have made a difference - Ngā mihi ki koe e Neil.

You can find out more about our current independent members on page 44.

At this year’s AGM you will see new faces on our board. We would like to welcome Sarah Mako, Ngāti Hāua Hapū Trustee who began earlier this year, and our newest trustee Ngaraina Brooks of Ōkahu-Inuawai Hapū. I want to thank Caroline Scott for the additional support at governance sub-committee level and all my fellow Trustees for your cooperation, trust, ability to listen to Hapū and uri and bring that back to our table, and for setting the ambitious course we have put in place. To the families of all of our board members and kaimahi, thank you for your love and support. For more information about the current board, go to pages 36-43.

Finally, thank you to our uri, whānau and Hapū; for your trust, patience and unfiltered whakaaro – our board and kaimahi continuously refine our strategies and delivery based on your feedback.

Last year was ground-breaking, we have got more of that to come in the current year.

Pai mārire,

Paula Carr, Pouwhakarae