Sealaska shareholders hold the Native Corporation’s future in their hands. What that future entails will depend on how proxies are cast. That means it’s up to the shareholders, each and every one, to make their voice heard this week, to choose who will be at the helm of a company facing a concerning future.
The corporation has lost $142 million from business operations since 2009, including $73 million in 2013. Profits shared from other Native corporations totaling more than $100 million over the same period, paired with the company’s investments, have masked Sealaska’s financial woes, the Empire reported on in May.
If all incumbents are reelected, we are afraid shareholders can expect more of the same.
Typically, the Empire would not weigh in on this topic. Sealaska is a private company to all but its 22,000 shareholders. But those shareholders are also our readers, neighbors, friends and family. We’d like to see Sealaska -- a company known for its work in preserving the language and heritage of Alaska Native cultures -- return to profitability and ensure its existence for future generations of all Alaskans.
At the current pace, Sealaska will be bankrupt by 2020.
We believe fresh faces and ideas are needed. We worry the current group of board members, the same ones who saw losses each of the last four years, are in too deep.
Change is not always easy. But change is needed now.
Shareholders should raise up their voices and, with their votes, usher in a time of change by selecting new members to the Sealaska board of directors. While casting that vote, also choose to move on from discretionary voting. Because, for incumbents without Sealaska’s backing, it’s an uphill battle to get elected. The use of discretionary votes by the board’s proxy also limits the chances of independent candidates. Last year, all four incumbents won re-election bids, receiving between 600,487 and 601,423 votes. The next highest vote-getter, an independent candidate, received 432,960 votes. Discretionary voting ensured the board could give its candidates enough votes to win, and the board knew how many votes each of its candidates needed to get another term.
Discretionary voting may be considered a common practice among many Native Corporations, but that doesn’t mean it’s the best method. It also creates an environment where independent candidates have to pay tens of thousands of dollars to be on their own proxy just to feel like they stand a chance. Not many shareholders have that kind of money to gamble on a board seat, but don’t they deserve the same opportunity as those in legacy board seats? It’s hard to compete when the corporation pays thousands to fly its candidates around Alaska and the Pacific Northwest to gain support.
“This is part of the regular course of business for Sealaska,” a corporate spokesperson told the Empire regarding campaign spending.
That statement highlights the problem.
Sealaska pays tens of thousands of dollars annually to each board member simply for being on the board, plus thousands more on travel, phoning in to meetings and reelection campaigns. The result: $142 million in operational loses over five years. This money belongs to shareholders, but they aren’t getting what they’re paying for. There’s been no job creation in Alaska (only 60 of Sealaska’s 200 direct jobs are in the state), and seemingly no clear vision for how the corporation will return to profitability.
We are worried that losing tens of millions has become the “regular course of business for Sealaska.”
We encourage shareholders to vote directly for the candidates of their choosing, whether that be an incumbent, independent or a member of the Sealaska 4 proxy. Then, vote to do away with discretionary voting altogether.
The upcoming election this week is a chance for shareholders to steer their corporation back on course.
• Empire editorials are written by the Juneau Empire’s editorial board. Members include Publisher Rustan Burton, firstname.lastname@example.org; Director of Audience Abby Lowell, email@example.com; Managing Editor Charles L. Westmoreland, firstname.lastname@example.org; and Asst. Editor James Brooks, email@example.com.