Opinion: Social Equity Colonialism

Editor’s note: Mark Slaugh, a person of color, works with companies across the United States and internationally and is actively involved in promoting social equity. This piece represents his point of view, which comes from his and his clients’ lived experience. Only by confronting sensitive issues in straightforward ways will the industry find solutions that work for all.

The most recent National Cannabis Industry Association (NCIA) conference highlighted the amazing work of colleagues who care, highlighting hot-button industry topics like sustainability and social equity, diversity, and inclusion. One could even argue there isn’t much difference between the goals of sustainability and social equity. Both acknowledge a need for the cannabis industry to think smarter, remain open to new ideas founded on evidence, and embrace change for the sake of a long-lasting, responsible, and profitable market for all.

While most people agree with those ideals on the surface, in practice solutions sometimes amount to nothing more than a veneer. “Window-dressing” social equity to pretend the underlying problems caused by prohibition are being resolved by “benevolent industry benefactors” barely masks or justifies the actual inequality perpetuated by a system that still isn’t working.

This masking should be a red flag for any social-equity operator seeking support, resources, and expertise, not to mention offering insight to allies who may not realize the effects this behavior has on communities already systematically downtrodden by prohibition.

National Geographic defines colonialism as “control by one power over a dependent area or people.” It occurs when one nation subjugates another, conquering its population and exploiting it, often while forcing the conqueror’s language and cultural values upon the subjugated people.

The culture of colonialism doesn’t go away when those writing, influencing, or executing social-equity laws aren’t consciously inclusive or diverse. This is especially true when privileged classes have a vested business interest to protect and see a zero-sum game with the people they barred from competing with them.

We’re seeing “social-equity colonialism” rear its ugly head in the predatory operating agreements that easily leverage ownership and control away from social-equity applicants. This reflects the deeper system in which a cannabis colonialist takes advantage of the disadvantaged for economic gain.

One of the biggest challenges for a social-equity operator is simply lack of knowledge or experience in cannabis or white-collar business. Knowing this, privileged operators sometimes take advantage of social-equity operators’ lack of knowledge by gaining their trust while doing the bare minimum and offering metaphorical table scraps in order to progress their more ambitious agendas for expansion and ownership.

The idea of setting policies and operating agreements and giving bare-minimum rewards reflects deeper systems of control that may offset fears of losing privilege or power. Often, privileged operators justify this by saying they “bring all the money, experience, or other assets to the table,” but such justification may hide a deeper colonialism culture at play.

More disturbingly, it reflects a fundamental disbelief in social-equity operators themselves and says more about the privileged player’s need to marginalize and devalue the social-equity operator’s contribution to the partnership. It seems seeking control mechanisms and putting “puppet operators in their place” are preferable to an equal partnership for some of the privileged.

This behavior is epitomized by some emerging incubator programs offering social-equity candidates the opportunity to be trained by privileged operators, often including the chance to win money in pitch competitions. To me, this is the equivalent of Roman gladiatorial combat with the promise of better scraps to the victor.

In some cases, operators use front organizations and tokenism to advance their agenda by pretending to be part of the community they then charge for membership, classes, and education — profiting from participants’ lack of education and experience. Sometimes this leads to cherry-picking from the social-equity competition to further tokenism or find those who seem willing to be devalued. Some operators later seek to acquire these businesses for less money than they may be worth, especially if the people in charge now “owe” them.

Even if these actions seem like they are paving the way with good intentions, they actually are setting up social-equity applicants for more failure and more colonization privilege. Examples of this playbook have happened across the industry ever since the first social-equity programs in Oakland, California, created opportunities for colonialists to buy out token operators for pennies while other legacy operators got passed by for being “too bold.”

Recently, lobbyists in Denver influenced social-equity program implementation, allowing dispensaries to partner with social-equity delivery companies in a way that allows dispensaries to pay less than Uber drivers make for deliveries. As a result, social-equity companies cannot make margins on the product and are forced to work for delivery fees only. The biggest companies are simply entering into token agreements using the playbook outlined above with the intent to buy out or start their own delivery operations when the law’s provision requiring dispensaries to partner with social-equity delivery operators sunsets in 2027.

In Illinois, we saw a similar situation in the sheer number of license lottery applications allowed from large corporations compared to smaller, social-equity-owned companies. Additionally, once awards were announced, a mass influx of investors came in to take equity percentages with little to no regard for the operators’ potential value.

For social-equity operators, these systems aren’t designed for success. After all, a zero-sum policy means privileged operators must have a sense of control and ownership and view any uncontrolled wealth or privilege for social equity as taking away their own.

Historically, it took most colonies a while to realize an imposed culture robbing countries of their economic means and wealth out of a sense of dependency did not work. Now, most of those colonies will suffer the repercussions of hundreds of years of colonialism for generations to come. Before it’s too late, social equity in cannabis similarly needs to declare a sense of autonomy and reject dependence on those who colonized cannabis culture and its wealth from those who are indigenous to it. NCIA’s Diversity, Equity, and Inclusion Committee has studied this issue extensively, noting what isn’t working and identifying the potential for policies that would have meaningful and valuable impact for social equity.

Some of the solutions include:

• Lock-out periods exclusively for social equity.
• Exempting social-equity operators from existing barriers like distancing.
• Ensuring funding for social-equity operators via low-interest business loans.
• Not allowing local government controls to dictate terms wherever possible.
• More access for social-equity licenses.
• Tax breaks on social-equity-made products.

Raising awareness about the behavior behind social-equity colonialism will warn cannabis social-equity operators and help allies who may not be aware of the colonialism at play avoid straddling the fence on such a critical issue.

Because the policies above offer less control to soothe privileged operators’ fear of losing power, privilege, or profit, allies and operators should anticipate pushback disguised as legitimate concern or opposition — often using the face of a person of color.

It’s important to identify the patterns of social equity colonialism ahead of anticipated pushback as we make advances in anti-colonialist policy. In doing so, perhaps social-equity policy can be independently declared and reasoned with for the benefit of all—not just the existing few.

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Mark Slaugh is founder and CEO of iComply LLC, a minority-owned cannabis compliance firm based in Denver. For more than a decade, Slaugh and iComply have helped ensure compliance and profitability for hundreds of cultivation, manufacturing, dispensing, retail, distribution, and delivery clients in dozens of markets. Named among the “100 People You Should Know” by Hemp Connoisseur Magazine, he often is asked to speak at national and international conferences regarding market development, policy, best practices, and operational compliance. Slaugh is a founding member of the National Cannabis Industry Association’s Diversity, Equity, and Inclusion Committee, where he serves on the National Policy Council and as chairman of the Policy and Regulations Subcommittee.