Yes.
Evidence of meeting #24 for Government Operations and Estimates in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
A recording is available from Parliament.
Evidence of meeting #24 for Government Operations and Estimates in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
A recording is available from Parliament.
3:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
I would agree. They did have an app, though. Do you have any comment on the failure of their past app and its transition from what appears to be the for-profit to the charity?
3:40 p.m.
Managing Director, Charity Intelligence Canada
The We365 app is in the audited financial statements, and it is immaterial when you're looking at a $60-million charity.
3:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Relating to your due diligence, you talk about transparency and accountability. Am I to assume the accountability would be to the board?
3:40 p.m.
Managing Director, Charity Intelligence Canada
No. We define accountability.... When you talk about boards, that's governance, and governance is not a metric that Charity Intelligence reports on.
Accountability, to us, is this: When you take the time to go through a charity's annual report or the information on its website, is there enough information there for a donor to make an informed and intelligent giving decision?
3:40 p.m.
NDP
3:40 p.m.
Managing Director, Charity Intelligence Canada
We will do it in due diligence, but it's not one of the metrics in our rating.
3:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Regardless of the metrics, would you consider it normal to have that kind of turnover within a board prior to a major project like this?
3:40 p.m.
Managing Director, Charity Intelligence Canada
When the information came out in late June and was confirmed through our discussions with WE Charity management in July, our concerns led to us issuing a donor advisory, which is our most serious red flag.
3:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
That is a serious red flag. It seems like a very basic level of due diligence, regardless of whether you're looking at it from a financial perspective or from a government perspective. This is something that you knew and that you identified in two days, and yet our government failed to—
3:40 p.m.
Managing Director, Charity Intelligence Canada
No, that information only came to light after the contract was signed, almost after the contract was cancelled. That only came to light in late June.
3:40 p.m.
Managing Director, Charity Intelligence Canada
That's the question. Is a charity under an obligation to inform a funder—or the government, in this case—when it's doing a serious deal of this size, and to do a full and frank disclosure?
3:40 p.m.
Managing Director, Charity Intelligence Canada
I believe it should be, but the question is, does the government have to ask or does a charity have to freely disclose such material information?
3:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Well, I think that if it's full and frank, the answer would be yes.
3:40 p.m.
Conservative
The Chair Conservative Tom Lukiwski
Thank you very much.
We'll now go to our five-minute round of questions, starting with Mrs. Block.
3:45 p.m.
Managing Director, Charity Intelligence Canada
I'm going to let Greg take a turn now.
3:45 p.m.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
Thank you very much, Mr. Chair.
I do want to thank our witnesses for joining us today. I appreciate the testimony that we've heard so far. I want to follow up on some of the previous questions.
This is for Charity Intelligence. A number of questions have been raised on the Byzantine nature of the WE network of charities and for-profit ventures. Is this type of convoluted network common in the charity world?
3:45 p.m.
Director of Research, Charity Intelligence Canada
No, it's not common. When we're analyzing a charity, we usually look at one set of financial statements and one organization. We will often look at two. If they have a foundation that's associated with an operating charity, or if there's a national charity that's associated with a provincial charity, there might be two. The odd time, we'll see three.
In the case of WE Charity, at this point I think we have 13 related parties in North America that we would have to at least have an understanding of as we write up our analysis. WE Charity is not typical of charities in Canada.
3:45 p.m.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
Thank you for that.
Again, Charity Intelligence, you have publicly asked why Craig and Marc Kielburger are listed as co-founders of WE rather than as directors, officers or trustees. Can you provide an explanation as to why that question is important, especially as it relates to the CSSG contract?
August 13th, 2020 / 3:45 p.m.
Director of Research, Charity Intelligence Canada
If you are on the board of directors or if you are an executive of a charity, any financial transactions that take place between you and the charity have to be fully disclosed in the audited financial statements.
As a co-founder or a founder, there is no fiduciary responsibility, no executive responsibility, so that just led us to the question of why Marc and Craig, who seemingly have an awful lot of executive power in the WE organization, are neither executives nor on the board of directors.
3:45 p.m.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
I'm not sure how much time I have.
Mark Blumberg was quoted in a Globe and Mail article on August 1. He's a lawyer whose specialty is the charitable sector. He said this regarding WE Charity: “It’s not like any charity that I’ve ever seen.... So I wouldn’t draw too many conclusions about the charity sector from this group. But I think what makes it clear to me is that we need more transparency in the charity sector.”
I think we've been hearing that a little bit, certainly in response to some of the questions by Mr. Green. There was this back-and-forth about full and frank disclosure, whether a government or an entity that's seeking to have an organization oversee a contract on its behalf...whether or not there is that full and frank disclosure, or whether that government or entity would need to ask.
I'm wondering whether you can comment on Mr. Blumberg's conclusion that more transparency is needed in the charity sector, and quite frankly on the process of governments and what they can rightly expect from a charity.