 Welcome and welcome to today's live session. Today you're going to hear these live sessions are actually from fellows for the New Zealand ecosystem and further afield and it's to showcase what fellows have been working on inside EHF and today you're going to hear from two fellows and the team of experts that they have been working from inside New Zealand and from around the world. So it's the stewardship session so hopefully everyone's in the right session so rethinking ownership so hopefully you've come along to the right session and I'm going to hand it over to Stephen Moy from C7 and he will introduce the fellows. It's a real pleasure to be here this morning thank you all for joining. As Michelle said my name is Stephen Moy and I'm based in Otatahi Christchurch and I work as a lawyer looking at legal structures and things and I have been working to help pull this paper together with some amazing co-authors who are joining us today and I'm in C7 of EHF and we're just going to briefly introduce each of ourselves. Not all of us are going to be sharing on the call actively but most of the co-authors are here on the call so I'm just going to pass over to Natalie to introduce herself who will then pass on to somebody else who can briefly introduce themselves as well. Thanks Natalie. Kia ora. My name is Natalie Reitman-White and I'm in the fifth cohort of the Edmund Hillary Fellowship. I'm based out of Eugene Oregon as well as British Columbia and hopefully someday we'll be spending some time back and forth with New Zealand when things open up. My background is in the food industry. I've worked as an executive in the food industry and ag sector in the US for the last 20 years and as part of that my focus has been on sustainability so how do we use the engine of business to create better outcomes for people and the planet and as part of that I've started a number of trade associations for sustainability leadership and served on corporate boards and got very interested in this topic of how do we look at corporate governance and investment terms and ensure that we are setting them up to kind of shift the goals and incentives to drive better outcomes for people and planet so that's my my current focus is corporate ownership forms, alternative forms and different kinds of impact investment terms. That's great thank you so much and next up maybe Philippa could you introduce yourself as well. Kia ora tatou. My name's Philippa Wilkie. I'm a lawyer in Tamaki Makoto which is Auckland. I work in the field of trusts primarily so both trusts in a family context but also trusts in a charitable context and with other non-profit entities some social enterprise and have collaborated with Stephen on a number of pieces of writing in this growing and developing area of law and so I will feed into some of the discussions today about the different legal entities that are available in New Zealand and how we can manipulate them to our benefit. Thank you so much and we have other co-authors who've joined us probably not all of us are going to be speaking because there's a lot to cover in a limited time but Murray do you mind introducing yourself as well because you've been a great contributor too. Thanks even good morning everybody. My name is Murray White. I'm at Avid Legal, a law firm in New Zealand. My background is technology, venture capital and ownership structuring laws and that's where I come in mainly on the company side and the alternative structures how to make these work and manipulate them as Philip has used the words for different types of impact investing trying to make sure we get different stakeholders involved rather than the shareholder primacy that dominates New Zealand company law. That's awesome thank you and the final co-authors joining us is Susan Gary. Susan do you mind introducing yourself? Great, hi everybody. I'm Susan Gary. I live in Eugene, Oregon where I'm on the faculty at the University of Oregon School of Law. I'm a law professor with a focus on trust law and the law of charities and I worked with Natalie to change our trust law here in Oregon to create a new type of trust that's a purpose trust that Natalie will be talking about a little bit later here in Oregon. We call it a stewardship trust because it's a vehicle for steward ownership so I'm really happy to be here listen in and contribute maybe on the chat. Yeah that's awesome thank you so we're really fortunate we also want to acknowledge that John Hania couldn't make the call but he had a massive contribution as well to the paper and in the chat we want to really use the chat function so we've put up a link there you can if you haven't seen the paper that's what we're going to be discussing and we'd encourage you as we're talking feel free to start typing in questions because we're sure that there will be questions that that you have and we will be actively watching the chat and we'll be trying to respond some of us to the chat questions as they come through but what we wanted to do really maybe we can go to the next side is we just got a limited window of time but we want to run through a couple points that we think will set the scene for this paper but also get into a bit of the detail and also part of the challenge here is that we're talking about things which we don't think have been done in New Zealand so we're really keen to learn from overseas examples and how things have been done overseas and that's why working on this paper has been a real collaboration because as you could hear we have Natalie and Susan contributing from the US perspective and that's been really beneficial so what we're going to do is have this we've kind of through it now the welcome and introduction we're going to turn to look at available legal structures in New Zealand then we're going to turn to look at some models overseas and then we're really keen to engage with you it's a small enough group I think we'll be able to go on unmute from time to time and hear your questions but also put them in the chat and then we can have a direction that we're going we'll be finishing sharply at 11 o'clock we're not going to go over time so make sure you get your questions in as we go as we go along and I think maybe one of the things just to say to set the scene is that this quote really represents what we were wanting to do here and I think it's really important that we recognize we're talking about stewardship in Kaitiakitanga because I think in New Zealand we have a unique aspect of our culture which is to our Māori and so when we prepared the paper we were really considering how can we actually how can we actually bring that to bear in this paper and so as this quote from Mark Prane illustrates you know this is a new lens to look at business for the future and that's what we're really trying to do we're trying to set the scene of what could business look like where we think beyond just who we are and I'm really happy that all of the co-authors have come together because it's actually kind of unusual for lawyers to get together and to work collaboratively so it's been awesome to work with Phillipa and Murray and and and the others because I think that's an example the tone of the paper was set there so I'd like to hand over to Natalie and if she could she's just going to run through some thinking about how we're thinking today and the ways of thinking thank you Natalie. Thanks Steven. So I wanted to start off by how we framed the paper which is about ways of thinking and we believe we posit that there are some shifts in ways of thinking that are occurring and there are some emerging concepts around legal forms of stewardship ownership and I would argue that the reason why these shifts are happening are for a number of reasons but the first is that as we globalize and as we evolve as societies we are recognizing the importance of inclusion of more voices and more people from different backgrounds holding power and that that is going to be critical to advance society forward and so I think embracing of women of indigenous communities of people of color is bringing new voices and new ways of thinking and ideas to the table about how we should go about our work together and organize our lives. The other shift that's occurring is not such a positive shift and that is that we are seeing major disruption in our in our lives because of how we've treated our relationship with nature for so long and we're starting to see some undermining of our our life support systems which I think is causing people to question whether the way we've been going about things is really the best way. So you know on the positive side inclusion of more people who have more ideas and also on the negative side some of the crises that we see not only with the environment but also extreme social inequity are causing us to rethink a number of things and as business people I would say we're starting to really rethink the role of business and society you know this this notion does the does a corporation exist to maximize value for shareholders or should it exist to maximize other types of value service to community and to create valuable products and services that serve people our profits an end in itself or should we see them as a means to an end of producing better outcomes. Obviously we need investment and we need profitability to help be some of the gas in the tank but it's not necessarily the end end goal to maximize above all else. We're also starting to think differently about wealth generation starting to think through a wider recognition of what wealth is beyond just financial capital what about other forms of capital that we want to keep healthy and wealthy such as human community care for and connection to each other our relationship with nature and the wealth of nature and investors are starting to rethink the terms of return is is a three year or five year investment cycle really always appropriate should they be thinking more long term about investments and that kind of holistic outcomes of those investments for multiple types of wealth and capital what are regenerative returns versus extractive returns I think we're starting to rethink our place in the world not as human centric we're starting to consider the multiple stakeholders who bring value so obviously investors are key founders are key but workers are key in bringing their life's energy to business communities that we operate in the natural world and we're also starting to shift towards thinking about not just short term horizons quarterly profit and so forth and starting to think about uh long term multiple generations and our responsibilities to not just ourselves today but the future so as we see these shifts one of the challenges that business people and investors who are thinking about wanting to drive towards different outcomes through their businesses come up against is that the modern corporate legal and investment forms are structured on an old paradigm and an old way of thinking which is the shareholder primacy paradigm and that is that there's actually a fiduciary responsibility of boards and most investment terms are structured around profit maximization and shareholder primacy so what we're looking at is how do we shift corporate legal forms and investment terms to achieve different outcomes and what might that look like so I will pass it on to the lawyers who can talk to us about some of the ways we're getting creative with hacking current forms and coming up with new forms thank you thank you so much Natalie and what we're going to do now is do a little tag team um Philip and I are going to run through some of the common legal structures that we see and um we're going to just explain really briefly what some of them usually pitfalls advantages that type of thing so to start with I'm just going to briefly mention the limited liability company and in the paper we talk about this quite a lot so I'm not planning to go into lots of detail basically limited liability companies are well understood people know how they work how they operate and in New Zealand this is a common form that we see gets adopted for purpose driven entrepreneurs because you can be quite flexible in terms of issuing shares to people you can be quite clear about what your mission and your purpose is I put a link to another paper in the chat where we actually looked at whether there were improvements to the limited liability company structure that could be made and one of the things that we concluded there was that having to enshrine your mission and purpose was actually something that would be really helpful for purpose driven entrepreneurs um but that isn't actually required in New Zealand you don't have to say what your mission and your purpose is you don't have to have a constitution so that in in my mind and in others minds is it's kind of a deficiency because it's very open and loose but equally it means that you're not actually needing to commit to what it is that you're about having said that it's a very flexible structure because you can issue shares to investors you can reward them through dividends you can report on your impact you can enshrine your purpose so quite often this is a vehicle that we will see used for impact driven entrepreneurs one of the downsides of course is that if the venture is successful then there's likely going to be takeover offers and people may want to come in and buy the company buy the shares and then it's very difficult for the original founder to lock in the bits that were unique that actually made it a purpose driven enterprise to begin with and a new owner could come in and decide well we're doing things different now so that's um but having said that it's a very flexible structure we put it first because it is often used and it's often adapted for the purpose of of the company um yeah so um we're just going to be tag teaming back and forth I'm I'm just pulling up here um Philip do you want to take over for the corporate company yes sure thanks um so I'd just like to say something um back relating to what Natalie was talking about earlier about uh the shift that we are seeing um in the psychology I guess of society these days and I think I'm really representing Yanhania when I say this but I think he would say which we have reflected in the paper that to our Māori has always viewed the environment and people and community to be at the forefront of of everything that they do to the extent that they consider themselves to be part of the land and the and the sea and the sky um and so in some respects we are really just catching up um you know the pākehā are catching up with a with a a way that they have approached the world forever um and interestingly they have always used the um the existing legal structures that we have and used them in a way that that works for them um so I guess you know Stephen and I are working through the existing options and how they can be manipulated um and the ideal would be that we do have something completely new and something that's fit for purpose where um you both have a commercial um intent and also a social or environmental purpose but until we do have that new model we need to work with what we have and um whether we use the word manipulate or adjust or adapt um we we need to use our creativity skills with uh with what we have and so in terms of cooperative companies they're quite special purpose um they have been around for a long time um we have a very our biggest dairy production company um it's called Fodtera uh that is a cooperative company um they're all owned uh um owned and controlled by members so essentially every dairy farmer in New Zealand is a shareholder in Fonterra and every dairy farmer instead of going directly to to buyers they um supply their milk to Fonterra who on sells it to the world um so it's it's a way of um banding together for a common purpose common goal achieving scale uh so another example is our um some of our supermarkets are owned in the same way where all of the products for those supermarkets are purchased by foodstuffs which is a big cooperative company and and in turn they are supplied to um the owners of particular supermarkets uh all around New Zealand um we also have mentioned in the paper Lumio which is one of the um social enterprise um social enterprises using the cooperative company so all of the shareholders are employees of the company and whether they be working in HR or PR or um IT or actually doing the programming for for the entity um they are very purpose focused they have an excellent manual online about their um cooperative structure and why it works for them uh so they are different from um what uh the the type of business that traditionally has used a cooperative company um i think that's all i have to say on cooperative companies Steven do you want to go ahead with the LP yeah no worries maybe we can put in the chat a link to Lumio as well like their website or something um also just on cooperatives there is um a group Ros Henry um is is leading it um looking at cooperatives and promoting them and they've got a website after i finish talking i'll try to find the link and put it in because there may be people some of you may be interested in in that um so i'm just going to look quickly at limited partnerships um so limited partnerships basically they um are sometimes used when there's a group of different entities coming together um and they will have amounts that they put in for a common goal or a purpose um they're usually well there will be a general partner and the general partner is responsible for the um liabilities and the debts and then the limited partners are also liable but only for the amount that they put in so there are actually some tax reasons why people would use limited partnerships as well where i've seen them used they are quite a flexible structure i've seen them used um in impact investing type of opportunities uh and you can have partnership agreements which describe what you're doing and kind of bring in some of these stewardship concepts which is kind of the foundation of what we're talking about here a new breed of entrepreneur yep but they are definitely an option that can be considered but it's usually um yeah specific sometimes for tax reasons that they'll be used um back to you Philippa to incorporate societies yes so i just um endorse what you said so limited partnerships are traditionally used for private equity investments which are you know it's a business where people are wanting to extract as much as they can from an investment process but equally they are now at their at least five if not more impact investment funds in New Zealand that are limited partnerships so you can have different types of limited partner one might be a charity one might be an individual one might be another type of entity and they they are all bound by their governing document which describes how why they exist why they are joining up together they can be there for a purpose they can be there for a small financial return they can be there for an impact return so limited partnerships are flexible um incorporated societies are a legal model that are mostly used for amateur sports and clubs in New Zealand i guess it's a little bit like the non-profit version of a cooperative company the members are not entitled to take any money out of the incorporated society so it's only used in the non-profit sphere the incorporated society can still make money but it can only use it for carrying on its whatever its enterprise or purposes it can't distribute that out to members and obviously it's not it's not a viable choice for any sort of investment that's me yeah we're really trying to cover off a whole heap of things any one of these would easily be an hour long discussion so just bear that in mind this is a high level overview b core status we put in just to be clear because it's becoming quite um people are getting more aware of it so we wanted to acknowledge it as a really amazing tool but it's it's about a certification you basically do an assessment you answer a bunch a bunch of questions and then you can qualify to become a b core or benefit corporation in New Zealand we don't have a separate legal structure like there is in other parts of the world like in America where there's um there's actually a benefit corporation type here in New Zealand it's an assessment and then you can qualify as a b core the latest statistics I'd heard is that there was about 33 benefit corporations or b cores in New Zealand um but significantly Kathmandu just became a b core so there are obviously a very large entity and that kind of maybe will trail you know trail blaze for others to follow um also Sinlay which is a large dairy company down here in Christchurch just became a b core so um you're not setting up a new a different legal structure here but you are joining a cub of entities which meet certain criteria which basically says you've looked at how you use your your power who you employ who the owners are all types of things to get a certain number of points to qualify to be able to say we are a b core so it's actually a really useful tool but it's not a separate legal entity and Philippa you're going to handle the next two so in in terms of the this heading is charitable entity so status is a registered charity in New Zealand um is just an overlay onto an existing structure um so what that says is three things it says that you have charitable purposes you're for the public benefit um and you're regulated by our charities regulator which is our department of internal affairs um it also says that you have certain fiscal privileges so you don't pay income tax um and there are some others uh and it can exist in perpetuity um so historically what was charitable was worked out um in a trust concept because a trust that wasn't for individuals had to be for a charitable purpose otherwise it would be void uh and it would be void because nobody could enforce it whereas the state can enforce charitable purpose so this is obviously still relevant for our purpose trust discussion today but we will we'll come to that um so as I said we can overlay this charitable status now on a company you can obviously have a charitable trust but you can also have a charitable incorporated society um so the difficulties with it are that you have to come within the traditional heads of charity which are religion education poverty relief of poverty and anything else of benefit to the community now the last one sounds fantastic sounds very very um flexible and open but actually even the categories within that have a tie back to a very historical piece of legislation from England so it's certainly not a sure thing that something that looks like it's being carried on for the benefit for community benefit for example will actually be able to tick the charitable head box um the other element of being a charitable entity is that private benefit is not permitted so paying salaries etc is fine but there can never be for example um dividends paid to shareholders that are not charities um therefore investment is going to um uh be impossible charities would fundraise um have they might have service income but they would attract donations rather than investment uh in terms of private trusts moving on to that heading so trusts are very flexible tools in New Zealand and they are prevalent so families obviously use them a lot they're what we are one of the jurisdictions in the world that has the greatest number of trusts per head um of anywhere which is not necessarily something to be proud of but they are very flexible so so you can we are seeing more and more and especially in an iwi context um trusts which are for the benefit of individuals for people for for iwi but they actually exist for a reason so for example they might exist to hold shares in a particular other you know operating company um and they might that you know the the the trustees who hold those shares are required to appoint directors to the company um always in the best interests of the beneficiaries and to vote on the shares in the best interests of the beneficiaries now historically what the best interests of the beneficiaries are um has has usually has been defined as financial benefits but increasingly uh and and we've had a um a family trust court case which has emphasised this uh the beneficiaries best interests should be looked at in a holistic way so it's not just will they get the most money out of this particular investment we're doing it's also does this affect the relationship between the beneficiaries um is this something sustainable is this something that is short term or long term um so it is possible to have a bit of a blend of purpose whilst still having definable beneficiaries which means that you have a private trust that is enforceable by those beneficiaries um then dual entity structures do you want to do this Stephen or I can no you're doing great keep it up um so in almost every scenario that we've looked at especially in that second paper that um Stephen has linked you into from the impact initiative almost every social enterprise has a dual entity structure so they would have both a corporate and a trust whether it's a private trust or whether it's a charitable trust and this this really um illustrates that we don't have one entity that can do everything that you need we need to um have two and uh and in that way you you get the the blended outcome that um that you're looking for so again the iwi structure I was just referring to early obviously that's so they have a private trust that owns um companies um and it it it seems to work well um equally it could be you could have a charitable trust owning the company which uh would um be able to distribute any profits that came from the company out for its charitable purposes um any other points Stephen there are some very good diagrams actually if you look in the paper we've got um the examples of either a charitable trust dual entity structure or a private trust dual entity structure the the trust element does mean that the the voting rights um for the impact entity can be held and dealt with in a way that is for the benefit of either the the charitable purposes or um or for individual such as awi yeah and and the thing is that I'm actually quite excited because this paper is certainly sparked in my mind how could we do this better in the future and I know Philippa and I and and Murray and and other like-minded lawyers are keen to explore this more and we would love to develop more templates and how this might actually work in New Zealand um to do that though I think we can learn a lot from overseas so just before I hand over to you Natalie I I realize we've gone through a lot of different legal structures the picture that I give to people is imagine you're buying a car you would go to the you know look at cars are you going to be going off-road you probably want this type of vehicle are you going to be cruising around the city you probably want this type of vehicle and it's the same when you look at legal structures it's a little bit like looking at vehicles in legal vehicles so it's important to get um good advice about what's appropriate for your situation because not every vehicle will fit exactly what you want to do so it's very difficult to just grab a template or say well that's the best option because every situation that I've come across has been very unique and specific and you have to look at the long-term plans of the people involved in things but Natalie we'd love to hear from you because we want to have a bit of back and forth and put your questions in the chat as well everybody and we'll come to those but Natalie can you just describe a bit of what you've been involved in because I think the rest of us have been intrigued and want to learn from what's been done overseas thanks sure thank you Steven so I'll share a bit about a structure that I've worked on in the US and I'd like Susan Gary to add on as a lawyer I'm not a lawyer I'm a ownership and governance design consultant and and have been a corporate executive so I understand it from that perspective so the case study I'll give that is in the the paper is I was working with organically grown company which is one of the largest distributors of organic fruits and vegetables in the United States been around for 40 years hundreds and hundreds of employees and and so forth and the company is mission driven the mission why the company exists was it was formed to help transform food and agriculture by helping farmers transition to organic practices and to create markets for those farmers to transition to organic practices so they formed a distribution company that could work with the farmers on certification technical assistance and then packaging and bringing their their product to market so the way it transforms food and agriculture towards more sustainability is to create good products on grocery store shelves for people to access and so while and and it is a for-profit rather than a charitable organization because the way that it carries out its purpose is to help farmers make a living doing farming in a different way and to help the staff of the organization the truck drivers the warehouses the sales people also make a living doing this and again to economically benefit consumers as well in the marketplace so so it's a for-profit business in that it creates change through shared prosperity but it's not a profit maximizing business the business had always operated in a way that it would take the profits that it was making and reinvest it back in itself to expand you know services provided to the farmers infrastructure better marketing more work on organic policy development better wages and benefits so the profits are continually being reinvested and shared with the multiple contributors of value to the business but that was in conflict with modern corporate forms modern corporate forms the board of directors are fiduciarily responsible to maximizing value and one of the challenges is is as our shares were held by farmers and employees as you're successful with your business the value grows and there's more and more of a pressure on the board members to look at offers to sell the company if it will maximize the value in the pockets of the shareholders also the protections around them maybe looking at reduced profitability by making some of these mission-related investments so we're really interested in how could we create liquidity for founders so founders who had built a nest egg by growing the company pay them back how could we bring in investors to help grow the company without the risk of the underlying value of the company being taken and sold off as private property because the next owner might take the company a completely different direction which would be away from the mission at which we had been fulfilling for 40 years so how do you protect from change of control when you have changes in investors needing to create liquidity and so forth so we were looking for a new structure for ownership and we had originally looked at putting the chairs in the hands of employees through ownership plans and so forth but again there was this pressure that those who are holding the shares could potentially cash in on the company at some point so we decided to settle the shares to buy back the shares of the company from the existing shareholders and move them into a trust that would hold the shares into perpetuity now the owner is a trust that will never die never wants to extract any value or profit as the primary shareholder and directs the board of directors to run a financially viable company and reinvest the profits that it makes back into the company so the trust has voting control of the shares and what's unique about this type of trust is it's a purpose trust so Philippa spoke earlier about a charitable trust where the purpose is a charitable purpose under one of those four heads of charity and usually that kind of trust owns a for-profit entity takes the profits and then gives them away to the charitable purpose or we talked about private trust which is similar in that except the beneficiaries rather than charities are people where the profits of the business is taken and given to people in a purpose trust situation there are no legal beneficiaries that are living human beings that can claim rights to the profits of the company underneath and the assets in fact in a purpose trust the board is directed to take the profits and the assets and reinvest them back into the purpose for which the trust is established so it's very unique in that sense and so what it does is in your trust agreement you can specify who has a portion or share of the economic rights and the profits so you can have investment in the company and you can find ways to pay back investors a portion of the profits alongside reinvesting in your mission and purpose and sharing with other stakeholders who you might designate employees community and others so it's a way that you can have your control be held by an entity that is 100 purpose driven will keep the board focused on purpose and running a viable company and then at the company level you can have a designated contractual agreements and stock agreements about how the economics will be reinvested in the purpose and shared with others on balance with that reinvestment in the purpose and it might sound really kind of out there but our company was able to recapitalize tens of millions of dollars moving the trust the company into the trust and bringing on impact investors who are interested in this kind of model of kind of a sustainable balanced return where they would get a portion of the profitability after it was also shared with others and reinvested in the purpose and this model is proven out actually we've studied for years in Europe there are some long term for-profit companies that are highly successful companies like Bosch and others that are owned by these types of trusts that sustain the company long term hold the steering wheel and allow for a sharing of economic returns on balance with protection of purpose so I'd like to invite Susan to talk about because I think this this could be a connection for New Zealand is not all states were allowing of these types of purpose trusts so we changed the law in Oregon to allow for this type of what we call a stewardship trust thanks and and that was a really good explanation of how these purpose trust work the reason that we had to change the law in Oregon to make it work in Oregon is that purpose trusts are were initially created for not to hold businesses to for much smaller purposes like the care of a cemetery plot is the usual example and so they weren't structured in a way in a way that allowed their use for for for holding a business in two respects one was that in some states in Oregon was one the trust couldn't last in perpetuity and the other was that the statute that we had would allow a judge to reduce the amount in the trust which if if the asset being held in the trust is a business didn't work so we needed to change the statute to fix those two things but in doing so we decided to structure a stat statute that would provide guidance to people who wanted to use this type of trust so in in crafting the statute we used the trust agreement that had been prepared for the company that Natalie described and we were able to use that as as kind of a model for what we put into the statute most of trust law is default law there are provisions of the statutes that are required but those are pretty minimal and so the company's trust agreement can provide whatever specifics that company wants but we wanted some guidance in the statute to make this a little bit easier for other companies to use and I'll add here that as I have been talking to lawyers in Oregon about this structure I've had interest from a number of different lawyers who are interested in looking at this model for clients sometimes for companies like the one Natalie described that's that's been purpose driven forever but also for family businesses where the family founder the whoever started the company is ready to retire but maybe only one or two people not a whole group of people and wants to have the business continue but the next generation isn't either interested or isn't up to the task and it's a way to be able to continue the business for the stakeholders and the family members can be stakeholders as well and might even have some financial interest in the business but they won't have the control the management the voting power because that's held in the trust so it's a really interesting tool in certain situations and as I think it was Stephen said in the chat it it doesn't you know these are all different tools and and finding the right tool for different businesses is important pass it back to Natalie well I think it would we'd like to hear questions that folks have and maybe some commentary from the New Zealand lawyers around these structures and how they might work how we might achieve similar things in New Zealand exactly and I think Michelle is having a look at the chat just to see if there's anything that we can pull out from there but also type in your questions now and now's your chance um we will run out of time soon so I think just a comment for me and then maybe Philip and Murray as well if you want to have a comment just I I do feel quite excited about the future because if this has been done successfully somewhere else why can't we do it here and really what we're putting the paper out now to do is to hopefully inspire people to try this and to to try doing it here and my sincere hope is that in a couple months maybe or maybe a year we'll do a part two of this paper and we'll actually talk about some examples which have taken on board the concepts that we talk about here and have actually implemented it and there's something happening in the Waikato or in Invercargill or wherever it is that is actually taken on board the thoughts that we've put in the paper and we've actually advanced the discussion because if we could unlock this it would be really transformative for our New Zealand society so Philip and Murray maybe you want to add a comment as legal from legal perspective your your thoughts about what we've heard from Natalie yes I would just like to add that trusts are used for quite a lot of different purposes and I use that in a loose sense in commercial settings in New Zealand so whilst we obviously have family trusts and there are charitable trusts there are also there's also a big pool in the middle where you may have a trust for employee benefit you may have a trust that's holding something for some people before it's transferred somewhere else we also have community trusts but they are products of legislation so I do believe in the flexibility of the private trust as an entity and the the purpose piece has it has been endorsed or given sort of elevated importance in we've got a new statute coming in in January our new trusts acts which refers to the context and the objectives of the trust in quite a few different places and I think taking sort of a step up from the that the context and objectives of the trust provided that you also have a group of individuals or classes of individuals who could enforce the trust and I think that we have plenty of plaster scene to work with yeah good comments I'm looking forward to seeing how that plays out from my side a couple of comments on just the practicalities of how you go through this I think one of the working with different groups one of the biggest challenges is that a lot of people starting out on this path are working with new business models and when you're working with a new business model there's some time that needs to be taken and identifying what stakeholders are at play what the dynamics between the groups are and really the legal structure flows from from having teased those things out it's a little bit easier when you've got an existing business model and a more stable environment that you're working with amongst stakeholder groups but when you're doing something new it's it's even a little bit more challenging so for the people that are thinking about going down this path putting in a lot of effort into what your business model looks like what the various stakeholders involved will be how you want to remunerate or will reward different and share the benefits of of the the organisation is really the key and then it's really after you know the landscape then you can figure out what vehicle to drive through it using Steven's analogy just conscious there's a question from Barry Neil Barry did you want to unmute and ask a question sure thank you great discussion and yeah it just I've been as an economist I've been fascinated with the role of externalities for a long time and studied them when I was in graduate school and and I'm just it was thinking as I was listening to the description of the various structures and so forth and maybe Mary goes to your actually the last point sort of what what drives what drives the structure or does the structure drive the business model and I think you've kind of answered that question but I've you know we've been debating in in the US for a long time the idea of price putting a price on carbon for example and the impact that that will have on the energy industry you know across multiple layers it's from producers to users it's it's but it's you know a concept that's well worn within the ranks of economists for a long time and I'm just curious you know that so that's a potential social good if you will or so you know the social benefit but can it work the other way can structures drive you know sort of the policy making or the economic side or does it come the other direction that was a nature my question if that makes sense yeah I'll jump in they're interrelated ideally the the the model that you're working with of the the purpose drives the the structure but what we find is because some of the structures are a little bit inflexible over time sometimes the structure ends up driving the purpose and you know maybe to Natalie's point about the organic farming example where you have a group of owners they might start off with good intentions but you know if they sell and change over time the the group that steps into the ownership shoes has the power so trying to dislocate in that sense the shareholder and and the purpose or put them together so the purpose is the driving factor and can't be bought out want a better word as an example of of trying to use a structure to maintain the purpose so there's a lot of interrelated bits there but ideally what you're trying to achieve drives the structure not the other way around yeah I would I would agree with that that I think unfortunately we have entrepreneurs that start off with great ideas about how to change the world and they start building out the business model and then they go to seek investment and the investors say well I expect this market return and then they contort the business model to achieve those returns and what happens is you might squeeze other parts of the value that you would have been creating and so what I encourage folks to do is come up with a realistic model of how you what are that do some heavy financial modeling on your business what are you going to need in terms of investment and what are you going to produce in terms of return and actually look at the full spectrum of return I've worked with entrepreneurs to say well we could have a more extractive model and produce a 15 percent return but instead we're actually going to make sure that 15 percent is divided with a portion that goes back to these different sources of value creation and investors are going to get a chunk of it but not all of it we're actually going to take a chunk and reinvest it in some of our technical assistance for farmers on soil building and there's going to be credits associated with that we're going to reinvest it in some of that infrastructure we're going to reinvest it in the workers that are creating the value to who often get shortchanged in agricultural systems from low wages and benefits so I actually have worked with investors to do a presentation where they say yes this model generates a 15 percent return you as an investor are going to get five to seven percent and here's the other returns that are actually going to go back in these tangible ways and this is going to be the result and so it's actually monetizing and demonstrating in the financial model how you will do that and put your money where your mouth is essentially because a lot of people say we want impact but then they say but we expect it to be the market return and a market return is often predicated on not accounting for the folks who get squeezed in the process or the externalities so I don't think people are bad people I think it's a shift that needs to happen you know in in the minds of the investment kind of term setting thank you Natalie so we're actually run out of time it goes so fast doesn't it so what I encourage the speakers to do is put your email addresses in the chat so that people can find you easily and then that way if someone wants to continue that conversation at another time they can email you and you can sort out other ways but I hope you've enjoyed the session and are you going to share you've shared the document so that's great so everyone can connect in that way I'll just give you a few more minutes so that you can put your email addresses in the chat for people to grab them before we end the session but thank you very much for taking the time and for Dialing and Susan from Oregon as well and I hope you all got something out of that and yeah please I know we ran out of Christian time but feel free to reach out to the team I've done a great job all through COVID they're very cooperative weren't they it was great yeah thanks team and thank you to Michelle for bringing us all together to produce this paper it was really appreciate it thank you for your organizing