22 May 2014

Nalcor and Conflict of Interest #nlpoli

Is anyone else having trouble trying to figure out what all the fuss is about Cathy Bennett, Nalcor, and conflict of interest?


Here’s the story in a nutshell.

While Cathy Bennett was on the Nalcor board of directors, she talked to a company about taking a partnership position with the firm.

She didn’t know the company did work with Nalcor.  The company was actually talking to Nalcor before Bennett joined the Nalcor board.  The Telegram’s James McLeod quoted a spokesperson for the company in the first story on this:

“We’ve had a relationship with Nalcor prior to even getting to know Cathy Bennett,” Lavoie said. “There were some people within Nalcor that had contacted us due to some prior experience with our organization, and asked if we were interested because they knew we had done a lot of work in the power generation sector.”

Bennett told Nalcor senior management and the Nalcor board about the talks when she found out that the two companies had a business relationship.  She did not take part in any discussions related to that company for her entire time on the Nalcor board.

Several months after she left the Nalcor board,  Bennett took an ownership stake in the company.  She sold her interest in the company when she ran for the Liberal leadership.

Once Bennett announced she was leaving the Nalcor board, Bennett met with officials of the Premier’s Office to express her concerns that Nalcor’s existing conflict of interests policies weren’t strong enough.

That’s the entire story the Telegram’s James McLeod wrote last week.  McLeod used more words, but that’s what it boiled down to. 

Read the entire McLeod story again and you will see that Bennett denied she was in a conflict of interest because wasn’t in one.  Her disclosure plus the measures Nalcor put in place dealt with the problem.  It wasn’t a perfect solution, but it was one that worked.

Now let’s flip to the second story, from Tuesday’s Telegram.  Current Nalcor board chairman Ken Marshall says that Nalcor had a conflict of interest policy.  He sent McLeod copies of the conflict of interest policy.

And on Wednesday,  the Telegram ran a story in which Bennett says that Nalcor had a conflict of interest policy while she was there but that it seemed pretty weak to her.  Go back and read the first story again and you’ll see that’s pretty much what she says.

So what’s the fuss, exactly?

If Bennett had kept quiet about her connection to the company and continued to participate in board meetings, she’d have been in a conflict of interest.  The situation wasn’t ideal but since Bennett disclosed her business interest and the Nalcor board took steps to avoid having her in a conflict, there wasn’t a real problem. 

Bennett didn’t actually take the partnership spot until months after she left Nalcor.  No conflict there either.

But if you are interested in Nalcor and real conflicts of interest, there’s plenty we could be talking about, as SRBP has pointed out in the past.