10 November 2015 - Beware Black Cladding - The Australian
Non-indigenous companies could try to misrepresent themselves as Aboriginal businesses in a bid to win contracts worth hundreds of millions of dollars under a radical new federal scheme, according to an Aboriginal leader.
Under its indigenous procurement policy launched in July, the federal government aims to award 3 per cent of its business to indigenous suppliers by 2020 in sectors as diverse as construction, security services, catering and office supplies.
If successful, the number of federal contracts awarded to indigenous businesses will rise from 250 to more than 1500 a year by 2020.
But the coming boom has sparked fears that non-Aboriginal businesses will try to pass themselves off as indigenous — a practice dubbed “black cladding” — in an attempt to grab a share of the lucrative contracts.
Supply Nation chairwoman Leah Armstrong said the organisation — a not-for profit body designed to support the growth of an indigenous business sector — would be responsible for ensuring that companies applying for contracts under the new scheme were verified as indigenous.
The group’s staff confirm the indigenous descent of company officers and question board members and executives to ensure that decisions on finance, strategy, operations and personnel are being made by indigenous boards or management.
“The indigenous business sector has been saying there is a risk of ‘black cladding’ because of the huge opportunities this policy is going to create,” said Ms Armstrong, who is also a member of the Prime Minister’s indigenous advisory council.
“There may be some unscrupulous behaviour where non-indigenous businesses might have an indigenous director or an indigenous face, but they have no real say or control or engagement.
“Our suppliers say to us this is a risk, and we are working with the government and supporting the awareness of that.
“We certify indigenous businesses to make sure their ownership structure, their management and control is indigenous.”
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