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Why Social Equity Needs to Be Front and Center in the Cannabis Space

Six Leaders Discuss the Importance of Social Equity and What It Means for the Cannabis Industry

The war on drugs might seem a distant memory to the casual observer. More and more states are rolling out medical and adult-use programs, and federal legalization seems to be more a question of when not if. But, like any other kind of war, the damage lasts long after the battles are fought. Communities of color and low-income communities, those harmed most by cannabis prohibition, still suffer the consequences of those targeted policies while the legal industry booms around them.

Meet the Thought Leaders

Six leaders in the cannabis industry spoke with New Cannabis Ventures about cannabis social equity and why addressing the harm done by the war on drugs is paramount in the industry now and going forward.

Amber Senter is the Executive Director and Co-Founder of Supernova Women, which focuses on education, advocacy, and network building to help people of color enter and become successful stakeholders in the cannabis space.

Rashaan Everett is the President of Growing Talent and the CEO of Good Tree. Growing Talent serves as an incubator for social equity applicants, while Good Tree is a cannabis brand that can be developed into a franchise.

Shanita Penny is the President of the Minority Cannabis Business Association’s (MCBA) Board of Directors. The MCBA is a nonprofit advocacy organization that works to improve diversity in the cannabis space through policy and education. New Cannabis Ventures supports MCBA through membership in the organization.

Kris Krane is President and Co-Founder of cannabis company 4Front Ventures.

Wes Moore is a Director and social impact subject matter expert with cannabis company Green Thumb Industries.

Charlie Bachtell is the CEO and Co-Founder of cannabis company Cresco Labs.

Understanding Social Equity and Why it Matters

The war on drugs has resulted in disproportionate law enforcement targeted at and incarceration of people of color and people in low-income communities. “The cannabis industry has really been built on the backs of black and brown people going to jail. So it is very important that we address the issues of what the war on drugs has done on these communities and try to repair them,” says Senter.

Social equity is about addressing those harms by giving people of color a seat at the table and using money from the now-legal industry to reinvest in the communities that suffered under prohibition policy. It is also about encouraging employment and ownership opportunities in the industry. “We cannot talk about the benefits of legalization without also talking about the consequences of criminalization,” says Moore.

Challenges to Overcome

Opening up the conversation about social equity throughout the industry is a start, but a number of challenges stand in the way of making effective change. First of all, education remains an issue. “A lot of elected officials don’t quite understand how bad the problem really is,” says Krane. Widespread, effective social equity policies will struggle to move forward if regulators do not understand the history of cannabis prohibition and its harmful consequences.

Organizations like MCBA are integral to providing that education, but large, successful cannabis companies can step up to stress the importance of social equity. “A lot of the reasons so many equity programs are seeing obstacles is because these operators aren’t providing input,” says Everett. Cannabis companies that actively offer feedback and participate in policy discussions and programs can be a vital step toward filling the education gap. Stakeholders in the cannabis industry can amplify our voices,” says Senter.

While social equity policy is still in its infancy, people of color most affected by the war on drugs have higher barriers to entry into the industry. In many cases, people with cannabis-related criminal records are prohibited from participating in the industry, according to Penny. “Black and brown people are still being locked up for this substance. Then you have other folks that are selling companies that are over $800 million,” says Senter.

Even if someone with a criminal record can participate in the industry, unconscious bias remains. Will a company hire someone with a criminal record? Will investors put capital into a social equity applicant’s business? The limited pool of capital in the space – largely made up of friends, family, family office, and cannabis funds – tends to go to businesses with a proven track record, while a social equity applicant’s business is seen as a riskier option, according to Krane.

Even when a social equity program does officially roll out, hurdles remain. How do municipalities and states use cannabis tax revenue to reinvest in communities? “Taking all of the cannabis tax revenue and putting it towards issues that we care about has been a challenge,” says Senter. “A lot of municipalities, like Oakland, are running with a budget deficit. They don’t want to give up these cannabis tax revenues. They want to keep them in the general fund.”

To Read The Rest Of This Article By Carrie Pallardy on New Cannabis Ventures

Published: April 09, 2019

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