Nalcor chairman defends conflict-of-interest rules

James
James McLeod
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Disputes claim by Cathy Bennett that company has no guidelines

Ken Marshall, chairman of the Nalcor board of directors, said he can’t understand why former chairwoman Cathy Bennett would say there are no conflict-of-interest rules at the Crown energy company.

Ken Marshall. — Telegram file photo

Last week, The Telegram re­port­ed that while serving as chairwoman of the company board, Bennett was in discussions about becoming a partner with an industrial contracting company, Sunny Corner Enterprises, which has done more than $10 million worth of business with Nalcor in the past few years.

Bennett said she conducted herself in an ethical way, and recused herself from Nalcor board meetings in which Sunny Corner was discussed, but the real problem was that the government had no interest in implementing conflict-of-interest rules.

“As chair, I was concerned that Nalcor didn’t have any conflict-of-interest rules and policies in place,” Bennett told The Telegram last week. “As chair, I advocated for conflict-of-interest rules. Ed (Martin, CEO of Nalcor), at the time, agreed that we did need some conflict-of-interest rules at Nalcor, and I, as chair, agreed to meet with representatives of the premier’s office to ask what the premier’s office position was on the board looking at implementing conflict-of-interest rules.”

The Telegram requested comment from Nalcor last week, but did not receive a response by deadline.

After the story was printed, Marshall contacted the newspaper to say that Bennett’s comments don’t make any sense.

“(Based on the story) it appears that Nalcor doesn’t have conflict-of-interest or code-of-conduct rules for the board, and that, quite simply, is not the case,” Marshall said. “The perception should not be out there that the board does not have conflict-of-interest rules or code-of-conduct rules, because we’ve got very strong ones. We’ve got a governance committee which is in place. It’s part of our internal audit process. It’s part of our annual transparency report as well.

Marshall had copies of the conflict-of-interest policy and the employee code of conduct sent to The Telegram.

The Nalcor employee code of conduct specifically deals with conflict of interest for everyone employed by the company, including members of the board of directors.

One of the guiding principles of the document is, “Any conflict of interest, whether real or perceived, and regardless of its materiality, has the potential to impair the company’s credibility and commercial interests — employees, officers and directors must perform their duties and responsibilities in a conscientious manner and shall not put themselves in a position where their private interests and those of the company might be or be perceived to be in conflict.”

Four months after resigning from the Nalcor board, Bennett became a partner in Sunny Corner.

Bennett said that when she met with officials in the premier’s office to advocate for tougher conflict-of-interest rules, she was told the government wasn’t interested in pushing for that.

She said she was pushing for rules similar to what would be in place by law in a publicly traded company.

“It was left at the discretion of the director if they chose to disclose they were in conflict,” Bennett said.

Marshall said he does not believe Bennett was in a conflict of interest in this case, but he also wanted to make it clear Nalcor does have rules governing conflict of interest.

In fact, he said that in 2008, when the rules were enacted, Bennett was on the board of directors.

“We’re all very clear on that, and when we adopted them back in 2008, Cathy was on the board, so she was part of the adoption and the review of the code-of-conduct and the conflict-of-interest rules,” he said. “Why she makes that comment that it’s just simply at discretion (of board members) I’m not sure, because she was part of the adoption of the conflict-of-interest and code-of-conduct rules in 2008.”

 

jmcleod@thetelegram.com

Twitter: TelegramJames

Organizations: The Telegram, Nalcor board

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Recent comments

  • Corporate Psycho
    May 20, 2014 - 17:03

    Bet it never bothered Marshall's Demi God Danny Williams.

  • Gabriel
    May 20, 2014 - 14:05

    @Angie/Dianne: Maybe you should be getting your resume up-to-snuff for the great Tory comm exodus after the next election. So how many of your Tory friends Angie are only in it to see what they "could possibly get out of it"? Politicians can be divided between potential versus proven sleaze bags. Your gang has amply demonstrated the category to which they belong. But hey there's another hour before quitting time, so keep those silly little posts coming. When you and Steve find yourselves jobless next year, perhaps you'll have your own business peddling horse manure.

    • Angie
      May 20, 2014 - 23:41

      I won't be shovelling anything as I have a very good job here in Alberta!! She is the reason people like me HAVE to leave!! If employers in NL would pay better wages to their employees instead of relying on Tfw's NL would be far better off! Most politicians are full of it so maybe Cathy will be the one shovelling!!

    • Angie
      May 20, 2014 - 23:43

      I won't be shovelling anything as I have a very good job here in Alberta!! She is the reason people like me HAVE to leave!! If employers in NL would pay better wages to their employees instead of relying on Tfw's NL would be far better off! Most politicians are full of it so maybe Cathy will be the one shovelling!!

  • Angie
    May 20, 2014 - 12:47

    The Liberals will keep being in the shadows having people like her in the party! She is only in this for herself and what she could possibly get out of it!! She doesn't think of Newfoundland, she could care less!! Wake up NL don't fall for it!!

  • Arthur J.
    May 20, 2014 - 12:22

    Did you mean to say 'attracting' instead of 'attacking' Dianne? Please don't text while you drive. Ball and the Liberals have a conflict issue to deal with - albeit not as big as the one facing Coleman and the Tories. As for your fervent wish that the Liberals never come to power, I assume you prefer the 'people' the Tories can't attract to the ones the Liberals can. Really, aren't you just one of those hundreds-strong pool of comms, hacks, trolls, etc. the present government keeps on its payroll to mislead the public? As a lifelong Tory, I can't find a single reason to vote this secretive, clandestine clan back into office. The NDP were an option until yesterday. So Ball wins by default.

  • Dianne
    May 20, 2014 - 10:25

    Time for Cathy Bennett to step down, and go on her merry way. I hope the liberals never come to power, with the type of people they attacking..

  • Alli
    May 20, 2014 - 09:15

    I wish we could have someone trustworthy like Ken Marshall run for election instead of the other yahoos that seem to gravitate towards the job.

  • Laughable
    May 20, 2014 - 08:27

    Next election, Time to Cathy the boot, before we find ourselves in real trouble. with this lady.

  • Virginia Waters
    May 20, 2014 - 07:56

    The conflict rules at NALCOR seem anything but robust. Vague and ineffectual they might be, Ms. Bennett's conduct might nevertheless be seen as being in breach. We don't know because we don't yet know when it was that she first began her discussions with Sunny Corners, what disclosure was made by Bennett - when and to whom, what conflict determination ensued, whether the code includes a cooling-off period, and the answers to many more such questions. But there is one thing that should be obvious to NALCOR and the public. It is that Bennett's actions from a conflict perspective were active not passive. It is not the case, for example, that Ms. Bennett had a pre-existing interest in a company doing business with NALCOR at the point she was appointed to the board and that she and NALCOR had taken steps to avert any real or perceived conflict. No, it could be argued that it was by virtue of her involvement on the board and her exposure to NALCOR's procurement plans that she would have identified this particular investment opportunity (one starkly different from her presumed core business). If so, the potential for an actual conflict would be that much greater. In turn it should have triggered a much higher degree of scrutiny by NALCOR. So if we believe that Coleman's prior business dealings with a government over which he is about to assume control requires independent review, then it is fair to ask whether Ms. Bennett's business dealings with NALCOR during and immediately after her stint as director also deserve scrutiny. A year from now she might well be this province's finance minister. Those occupying such important positions of public trust should possess the moral authority that can only come from a record of unquestioned integrity with respect to their private business interests.

  • Torey Nomore
    May 20, 2014 - 07:39

    McCathy is a Red Tory; backroom deals, reason number 352,961 that I cannot vote Tory no-more.

  • guy incognito
    May 20, 2014 - 07:21

    Looks like McBennett is burning her old bridges. Count how many times she toots her own McHorn in this article. I did this, I did that, as chair I was concerned, as chair I agreed...... The McBennett ship is sinking....

  • Ed
    May 20, 2014 - 07:19

    Another politician is born! Her name is Cathy.

  • Maurice E. Adams
    May 20, 2014 - 07:01

    And of course they are well adhered to ---- Ed Martin is in conflict by being CEO of both Nalcor and NL Hydro . He thereby is in a position to pressure and decide that NL Hydro must buy Muskrat' power and agree to their Power Purchase Agreement. Also, while NL Hydro is governed by the lowest possible cost provisions of the Electrical Power Control Act, Nalcor is not.

    • Morry
      May 20, 2014 - 12:41

      A dog and his bone.

  • concerned
    May 20, 2014 - 05:31

    Bennet said "It was left at the discretion of the director if they chose to disclose they were in conflict". Marshall is not disputing this. Most publically traded companies require that directors, or key employees list any conflicts on a proactive basis. This would include businesses they own, directorships they have, or friends/relatives who work at companies whom may be subcontractors with the firm. It is not voluntary. This seems to be what Bennet is requesting, and what Nalcor does not have in place? In a publically traded firm it is the role of the goverance committee to ensure the proper procedure is followed. It would check to ensure that a proactive check of the conflict register is completed before people are assigned to review bids for example. Due to the nature of our community, we should expect a higher standard from Nalcor. The work of the governance committee should be reported in the annual transparancy report. This would include reporting on complaints, investigations, audits etc. Nalcor's report contains none of these items, and is more another version of the annual report. Furthermore a quick check by Marshall would also confirm that Nalcor has not issued the transparancy report since 2011. The 2012/2013 transparancy and accountability reports are missing from Nalcor's website. Kind of fitting in my mind.