Explainer

What is black cladding and how is it hurting mob?

To qualify as an Indigenous business, an organisation needs to be minimum 51 per cent Aboriginal-owned or controlled. Some say this isn't enough and that the system is being gamed.

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Some say black cladding is 'greedy and racist' and takes opportunities away from Aboriginal and Torres Strait Islander peoples.

In the last few years, more and more Indigenous people are speaking up about the harm of 'black cladding' and the real-life consequences for mob in the business sector.

But what is it, how do we spot it and what can we do about it?

'Greedy and racist'

Wiradjuri woman Jarin Baigent is the CEO and Founder of Trading Blak, an organisation that champions 100 per cent Indigenous-owned businesses.

She knows the harms of black cladding all too well.

She describes it as when "a business projects an image of being an Aboriginal business, but in actuality, the business itself, or the people that are the nuts and bolts and the guts of the business, are not Aboriginal."
Jarin Baigent
Wiradjuri woman and Founder of Trading Blak is advocating for harder protections for black cladding. Source: Supplied
Aboriginal lawyer and founder of AMK Law, Matthew Karakoulakis believes it comes from the "vein of businesses wanting those opportunities".

"They look at the dollar value. It's greedy and racist. It's a misunderstanding of what Blackness is about," he said.

As people , Ms Baignet says that we are also seeing more companies claim that they are an Aboriginal business.
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Matthew Karakoulakis of AMK Law. Source: Supplied / AMK Law
"An emerging trend in black cladding is that established businesses or newly established businesses are being owned and run by people who are identifying much later in life as well," Ms Baigent explained.

"And while there's no issue in connecting to who you are and being on that journey of discovery, but being an Aboriginal business owner and an Aboriginal person is much deeper than that."

Community at the heart of Aboriginal business

For Mr Karakoulakis said when telling the difference between an Indigenous and non-Indigenous business, one of the distinguishing features is that "an Aboriginal business typically has community objectives ... at the forefront of their existence".

"Whereas a white business typically looks at economic objectives," he said.

He also highlighted the importance of Aboriginal leadership.

“Aboriginal ownership has to be a component, but I believe that Aboriginal business leadership is an integral part. But you also have to look at the executive powers of the Aboriginal leader," he said.

“Not having that robs the business of the incredible value that we as Aboriginal business leaders have."
As it stands, Supply Nation, the peak organisation for registering Blak businesses, recognises a business as Indigenous if there's majority .

For Ms Baigent, anything less than "100 per cent Aboriginal" isn't adequate.

"Anything less than that needs to be re-determined as a joint venture," she said.

"What we need to see is an Aboriginal business being 100 per cent Aboriginal," Ms Baigent said.

Are the current protections doing enough?

The criteria has attracted criticism from the NSW Aboriginal Affairs and Treaty Minister David Harris who told NITV he will be working with the state's Indigenous Chamber of Commerce to strengthen the "accreditation process".

Ms Baigent wants to see "punitive responses" for those rigging the system.

Ms Baigent said there are "sophisticated business models" that are misleading in their marketing with "absolutely no recourse and no punitive response or penalty".

But Mr Karakoulakis believes the right protections are already in place - they just aren't with Supply Nation.
“There needs to be a better understanding of the protections that are already there," he explained.

“In the Australian Competition and Consumer Act there are a whole range of protections that deal with conduct and there are serious penalties.

“There are protections in this legislation, that make it illegal for a business to engage in misleading, deceptive conduct which is what black-cladding really is."

Mr Karakoulakis believes it's time to go "knocking on the door of the ACCC".

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4 min read
Published 2 June 2023 2:58pm
Updated 8 June 2023 9:23am
By Bronte Charles, Rachael Knowles
Source: NITV


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