Industry Committee on Jan. 31st, 2024

[Jean-Denis Garon, Bloc, Mirabel, QC]

Given that a legal opinion was sought because there was a serious ethical issue, and given that legal experts were of the opinion that it was legal to proceed, doesn't that mean the act that governs the organization should be amended?

[Leah Lawrence]

I think what's key is to actually review the act.

The SDTC act states within it that they would like to have people who have deep expertise in the area. At the time SDTC was created, which was 20 years ago, there was a very narrow group of individuals who it might be applicable to appoint to the board of directors.

Today the pool is much broader. I think the bar for conflict of interest could be much higher, as you have spoken about. That would be something the committee could consider and recommend changing in the act.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Yes, the act has been around for some time, and the context the organization is operating in has obviously changed, but its board members are still appointed by the government, which has to be aware of changes in the political environment and the market, for example.

At the Standing Committee on Access to Information, Privacy and Ethics, you told my colleague, Mr. Villemure, that “it's difficult to have a board of directors that is completely conflict free”.

Appointing this particular chair, whose companies had received funding, was taking things bit far, though. How do you see it? Why do you think the government was so determined to appoint Ms. Verschuren as chair of the board?

[Leah Lawrence]

I can't speak for the government and the minister's decision-making. What I know is that I recommended against making the appointment, and I raised the concerns.

[Jean-Denis Garon, Bloc, Mirabel, QC]

I have a question about the facts of the matter. Do you think there might have been someone, somewhere in all of Canada, who was just as competent and could have occupied the position without being in conflict of interest?

[Leah Lawrence]

What I know is my previous chair did not have conflicts of interest, so I do think that there's a broad candidate pool that could have been chosen from that did not have direct conflicts of interest.

[Jean-Denis Garon, Bloc, Mirabel, QC]

I understand.

We've been told that, when her own companies were involved, Ms. Verschuren recused herself, left the room and didn't participate in the board's discussions. Here's an important question. If a person in conflict of interest recuses herself and leaves the room but is, by all appearances, in a position of authority and will continue to be, does the conflict of interest leave the room along with that person?

[Leah Lawrence]

I don't think there's a question, but I think you're—

[Jean-Denis Garon, Bloc, Mirabel, QC]

Let me rephrase the question. While the board of directors discusses a given matter, the chair, who may be in conflict of interest, leaves the room. Do you think the conflict of interest leaves at the same time as the chair?

[Leah Lawrence]

I see. I think that in a situation where you have a power structure of a chair or directors that have particular conflicts, the best you can do in this situation is do exactly that, have them leave the room, but obviously, the perception is strong, even if they hold the highest standards and do not discuss the activities, that they should have recused themselves. I think that's the reason we find ourselves here today, that even if they held the highest possible standard and did not see any situations where they didn't talk about things conflicted outside of the meeting rooms, even if they did hold that high standard, the perception is strong that they may have.

[The Acting Chair, NDP, Brian Masse]

Thank you, Mr. Garon.

Next, welcome Mr. Barrett. You have five minutes, sir.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

You made assistant deputy minister Andrew Noseworthy aware of the conflicts of interest and problems in appointing Ms. Annette Verschuren as chair of the board in advance of her appointment. Is that correct?

[Leah Lawrence]

That's correct.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Mr. Noseworthy was aware that by appointing her, ISED was violating their own contribution agreement with Sustainable Development Technology Canada. Is that correct?

[Leah Lawrence]

I would have thought he would have known that, given that he is overseeing the organization and he knows what the act and the contribution agreement say.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Can you confirm that you had your staff contact the minister's office to raise your concerns about this appointment?

[Leah Lawrence]

Yes. We had several discussions at the staff level, so there were bilateral discussions with the minister's office. It was told to the minister's office that the previous chair had not had conflicts and that, in fact, in our knowledge, there had never been a chair with a company that was being funded by SDTC.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

What was the year that this appointment was happening and who was the minister?

[Leah Lawrence]

It was June 2019. The minister was Navdeep Bains.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

In 2019 the Trudeau government went ahead with the appointment after you had raised concerns with the minister about the conflict.

[Leah Lawrence]

That's correct.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

The minister of innovation was personally aware of serious problems with appointing Annette Verschuren but did it anyway. I'm asking for a third time because this is surprising.

[Leah Lawrence]

Mr. Bains did not tell me directly. I did not communicate with him directly, but Ms. Verschuren has said that she had talked to Mr. Bains three times before she agreed, and she said that he did know that she had a direct conflict.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Why do you believe that the Liberal government and the minister of innovation were so focused on appointing Ms. Verschuren?

[Leah Lawrence]

I don't have direct knowledge of what their concerns were, but I do know that they had concerns about his discussions publicly on other government legislation and policy that were ongoing.