Established in 2008 under the Alberta Enterprise Corporation Act, the mandate of the Alberta Enterprise Corporation (AEC) is to promote the development of knowledge-based industries and a venture capital industry in Alberta and to make venture capital available to knowledge-based industries.

Venture capital is equity financing provided to companies that are in the early stages of their development.
Obtaining financing can help fund operations, which over time improves the chance of success of these companies and contributes to strengthening and diversifying the provincial economy.

Up to March 31, 2020, the government provided AEC $175 million in funding for venture capital  investments, and will provide AEC a further $175 million for investment over the next three years.

Given the significance of the total investment of taxpayer money invested with AEC, we examined AEC’s processes on how it demonstrates to Albertans the value it has generated from its activities compared to what it set out to achieve under its legislated mandate.

We found AEC did have processes to measure, monitor and report whether its investment activities generate value in accordance with its mandate under the Alberta Enterprise Corporation Act, but not all these processes were effective, and improvements can be made.

While AEC reports to Albertans on activities and measures, it does not fully demonstrate to Albertans to what extent these activities generate value, how their results were achieved cost effectively, and lessons learned to help inform future venture capital investment.

AEC can improve its reporting of value generation by setting targets of what it expects to achieve and analyzing the results achieved to those planned results and to their cost. In doing so, it can better demonstrate the value its activities contribute to the provincial economy, and at the same time assist AEC management and the board of director’s decision-making.

Management started the process of improving internal reporting to the board and developing targets linked to measures for future business plans in fiscal 2019–2020.

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