With the passage of the Alaska Native Claims Settlement Act of 1971, the new for-profit corporate world came into conflict with the cultural protocols and ways of the Alaska Native people causing them to live in two worlds.
By early November 2000, I had acquiesced to the realization that due to global competition in the tech and plastics industry and the volatility in the stock market that Sealaska Corporation would post a loss at the end of the calendar year for the first time in 16 years. I reported that to the Board of Directors and recommended that we take some financial adjustments to the balance sheet, which have accumulated to the company over several years. Having accepted all this myself, we started the year with a New Year's resolution to focus on revenue-generating investments.
By the end of the third week of January our Sealaska management team and advisors were able to conclude the negotiations with the San Pasqual tribe gaming investment plus received a breakthrough on the limestone mining project, concluded all of the timber harvesting and road-building contracts for the upcoming year, and had completed the first phase of the FCC Auction 35 spectrum purchases. These transactions assured the company of $115 million in expected net earnings over the next several years. Although exhausted we were elated and felt successful - we had assured positive growth for the company and an increased dividend stream to the shareholders. The next day, the board met in Seattle for a retreat. The request for my resignation as president and chief executive officer came without discussion or explanation. In the hard-core, for-profit corporate environment, the CEO serves at the pleasure of the board and no reason need be given for such action. In the Tlingit world and way this will not be easily forgotten.
From the time I returned home from college and began my career, I considered myself a modern Tlingit warrior. As a rule, I vowed never to use my knowledge, skill or experience against my people. The decision to terminate me as president and CEO was made by people who were my mentors, family friends and business associates, some for over 30 years. I had entrusted the security of my family and my career with these individuals as I engaged in my professional work on their behalf.
My personal reactions to the board's action were multi-faceted. First, I felt like a soldier left behind on the battlefield. Then my thoughts turned to my many days spent commercial fishing, spent battling all manner of impediments to a successful season, and I felt as if I were a valuable tool that the captain had carelessly discarded overboard.
Over the years Sealaska has faced many challenges, ups and downs, as it progressed within the business community. My career started with the conveyance of land and resources today worth conservatively $2 billion. Although mostly illiquid and off-balance sheet, these assets are the core of the wealth of Sealaska shareholders. As time went on I took great pride in working with the difficult problems and events the corporation faced.
First came the start up with the village corporations and Sealaska in the timber industry; then in 1982 we processed a bad can of fish into the market in Europe. The Asian log export market fell, interest rates went to 21 percent and a subsidiary of the company was recommended for bankruptcy. Later we battled with the federal government over the NOL tax controversy. Through all of these times and others I was proud to be a leader and participate on the Sealaska management team that resolved these matters.
Over the last year and a half, our investment in TriQuest, a precision plastics injection molding company with plants across North America, became a victim of global competition and a struggling high tech industry. This created cash losses and extraordinary investments by Sealaska to sustain TriQuest. Through this period the Sealaska board and management worked to gain control of the subsidiary management, maintain the base of customers and operations, and together, in August of last year decided to move to sell or merge TriQuest as soon as possible. Despite our best efforts, even with the assistance of professional advisors, we were unable to accomplish this by year end. Although a drain on cash and a hold back of our investment capital for other ventures, I believe that this delay is something the corporation can overcome and will move on to more positive investments. In the meantime it looms negatively over everything. Considering all that in the perspective of time and corporate experience the TriQuest matter is not that great when compared with the total resources of the company.
There is an old saying "Success has many fathers and failure is an orphan." Some will criticize the financial adjustments I have recommended to the board of directors. It should be noted here that the origin of the business transactions recommended for adjustment were from the previous management before I became CEO. TriQuest, the limestone mine, the Hoonah stumpage purchase, and the 7(i) balance sheet adjustment are for the most part accumulated financial adjustments to the balance sheet. The financial health and valuation of the company will benefit in future years by these adjustments and a stronger dividend stream to shareholders will result. The nature of these adjustments may be misunderstood by many, however, I believe that these are in the best interest of Sealaska and I have recommended them.
As I look back over the last 23 years we have accomplished much. There is still much more to do. Many of our goals and aspirations are just underway and should see some follow through.
First, I believe that Sealaska should continue to participate in the free market and be market driven. There is risk in this strategy but the financial rewards will be there and will provide the support for our many non-business goals related to advocacy, culture and education.
Second, I continue to believe we can harvest timber and mine resources on a sustainable, environmentally sound basis.
Third, I believe that our investment in our children and our tribal members and culture, scholarships, totem art, and "Celebration" is an investment in our community and makes us unique in the world. The largest policy issue before Sealaska shareholders is the inclusion of our children and grandchildren as stockholders of Sealaska.
I believe that the chief executive officer of Sealaska must be a Native shareholder in order to represent the company before governments and in commerce; and I believe that we must systematically employ our shareholder college graduates at all levels of the company.
I believe that "subsistence" is the highest non-business priority of Sealaska shareholders because it represents our culture, and is a social safety net in the basic economy of the community.
And lastly, I believe that Sealaska is a powerful economic engine that can provide business and political leadership in the Alaska community.
Notwithstanding all that has been said, or will be said, my whole career has been with the Southeast Alaska Native community, my life is the corporation and I truly love the Sealaska people.
As I look back, I am grateful that I have had the opportunity to work with Sealaska and its shareholders. I have taken their message to the highest levels of government and commerce around the world.
We have dealt with many diverse and complicated subjects with diplomacy and oftentimes with intensity. My greatest personal feeling of success is the recruitment and promotion of young college-educated shareholders within the management of Sealaska and its subsidiaries.
I believe that the future of the company will be in the hands of the next generation and they should be given every chance to manage the company.
Robert W. Loescher is a Tlingit Indian and previously was the president and CEO of Sealaska Corporation.