Evidence of meeting #99 for Industry, Science and Technology in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was board.
A recording is available from Parliament.
5:40 p.m.
NDP
Brian Masse NDP Windsor West, ON
Can we just leave this to you to come back to us on Tuesday? If you have a confirmation and you feel confident in that, then we don't even have to have a motion for this. We can just move on from there and we'll revisit it.
Just let it go like that. I'm totally comfortable leaving it in your hands. You can come back and tell us whether this is going to happen or not, and then we can go back to a motion. We don't have to go this far.
5:40 p.m.
Liberal
The Chair Liberal Joël Lightbound
I would need unanimous consent to withdraw the motion.
Do I have unanimous consent to withdraw the motion and move on?
(Motion withdrawn)
I'll briefly suspend so that we can start the study on SDTC.
5:45 p.m.
Liberal
The Chair Liberal Joël Lightbound
Colleagues, we'll resume this meeting. It's been a little more than five minutes.
Pursuant to the motion adopted on November 7, the committee is commencing consideration of the study on the Recent Investigation and Reports on Sustainable Development Technology Canada.
I would like to welcome our two witnesses: Geoffrey Cape, Chief Excutive Officer, R‑Hauz, who is participating in the meeting by videoconference, and Andrée-Lise Méthot, founder and managing partner, Cycle Capital, who is attending the meeting in person.
Mr. Cape and Ms. Méthot, thank you for agreeing to join us, and I apologize for the brief delay.
Without further ado, I yield the floor to Mr. Cape, who will have five minutes to deliver his opening remarks.
5:45 p.m.
Geoffrey Cape Chief Executive Officer, R-Hauz, As an Individual
I have very brief remarks.
My name is Geoff Cape. I was on the board from probably early in 2016 until the end of September or early October 2022. I was nominated to the board by Susan McArthur, through the member council, so it was a non-political invitation. I served as chair of the governance committee for roughly two years. My experience with the board was excellent from beginning to end. It was a very professionally run board.
I've served on two Crown corporation boards over the last number of years, as well as on a number of not-for-profit boards and private sector boards. SDTC was, unquestionably, one of the best I've ever served on, both at the board level and at the management level.
I'm looking forward to the conversation ahead.
5:50 p.m.
Liberal
November 28th, 2023 / 5:50 p.m.
Andrée-Lise Méthot Founder and managing partner, Cycle Capital, As an Individual
Thank you very much, Mr. Chair.
Dear members of the committee, thank you for welcoming me today.
A few words about myself first: I grew up in Baie-Comeau, in the beautiful region of Côte-Nord in Quebec, and as far back as I can remember, my daily life has always been influenced by environmental issues.
In my career, I worked for Lucien Bouchard's Parti Québécois government in a policy capacity. Then I devoted my life to the development of new technologies and the fight against climate change. As a geological engineer, I have been working hard on this for over 25 years. I have dedicated my entire career to building a company that combines ecology and venture capital. It was a very surprising combination 20 years ago.
The purpose of my contribution to Sustainable Development Technology Canada, or SDTC, was to get involved in the Canadian ecosystem to build the global economy of tomorrow. Let's start with my involvement on the board of SDTC, to which I was appointed in June 2016. Upon being appointed by the directors, I sat on the board until 2021.
In the context of my commitment to SDTC, I have always acted with complete transparency by declaring all conflicts of interest, whether real, apparent or potential. That was the case for companies in the Cycle Capital portfolio in which we generally hold a stake ranging on average from 4% to 30%. The same was also true of companies likely to attract future interest from Cycle Capital because, in my field, we see projects coming far in advance. Situations that could be perceived as conflicts were always declared.
Even where there was doubt, even though SDTC's governance did not always consider a situation as a conflict of interest, I chose to withdraw. I am convinced that my actions demonstrate the seriousness with which I approach this process in all situations.
As for the universal and equitable emergency aid granted during the pandemic to all organizations in the portfolio that met the conditions pre-established by SDTC, allow me to go back in time a little bit. On that date, schools were closed, Quebec was preparing for a general curfew, supply chains were disrupted, and our entrepreneurs were concerned, wondering if they would go bankrupt and if they should lay off their employees.
It is important to note that several government programs, at both provincial and federal levels, were essential to keep our businesses afloat during this difficult period, in all sectors of activity in Canada, from Imperial Oil to the local restaurant.
As for what we implemented when I was at SDTC, these were measures aimed at protecting Canadian companies holding intellectual property in clean technology in Canada and human expertise, in other words brains. The goal was to avoid weakening them and thus preserving them from low-cost foreign acquisitions, by countries such as China.
Studies show that in Canada, green technology companies are underfunded, up to twice as much as their American counterparts.
Every time we weaken our companies by refusing to support them in times of crisis, for example, we are not building the Canada of tomorrow; instead, we expose them to the appetites of foreign interests, especially those of the Chinese.
I would also like to point out that during our discussions on the SDTC board of directors, we obtained legal advice from a lawyer at Osler. This legal opinion stated that no conflict of interest existed, given that the measure in question was universal and exceptional, applying equitably to all companies that had benefited from SDTC in the past.
In conclusion, faced with this unprecedented situation, it had become imperative to protect our technological companies, to preserve Canadian intellectual property, and to ensure the sustainability of our green technology industry.
Investing in our Canadian green technology companies goes beyond simple economic consideration. It is a commitment to our nation, to the environment, and to our children.
By supporting these companies, we preserve our technological sovereignty, create sustainable jobs, and contribute to building a greener and more prosperous future for all. I personally believe in this just transition.
At Cycle Capital, for example, we have invested over $200 million in Canada. We have also taken the lead and contributed to injecting $2 billion in equity into Canadian companies.
Today, our portfolio is worth more than $3.9 billion.
We have also participated in the direct creation of 1,300 high-tech quality jobs that are being filled by engineers, PhDs and leading experts on these issues.
Ladies and gentlemen, I am now ready to answer your questions and to take part in the discussion.
5:55 p.m.
Liberal
The Chair Liberal Joël Lightbound
Thank you very much, Ms. Méthot.
Mr. Perkins, the floor is yours for six minutes.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
Thank you, Mr. Chair. My first question is for Mr. Cape.
In your opening statement, Mr. Cape, you said that you served from early 2016 to early 2022 on the SDTC board. Is that correct?
5:55 p.m.
Chief Executive Officer, R-Hauz, As an Individual
That's correct—well, later in 2022, not early 2022.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
For some time on the board, I think the latter years, you chaired the governance committee.
5:55 p.m.
Chief Executive Officer, R-Hauz, As an Individual
That's correct. It was roughly two years; I don't know exactly how long it was.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
A year or two ago, the board passed a policy of a cooling off period for the directors who were not GIC appointments. Is that correct?
5:55 p.m.
Chief Executive Officer, R-Hauz, As an Individual
I'm not sure that was actually formally in place until shortly after I left.
It was one we were considering instituting, but it wasn't yet in place.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
Actually, it was passed.
In the time after you left, did you ask and interact with management of the board seeking to get funds from SDTC for R-Hauz, of which you are now the president?
5:55 p.m.
Chief Executive Officer, R-Hauz, As an Individual
It was a prior CEO of the company, and the owners and managers advanced a proposal well before I participated, so yes, but it wasn't from me; it was from them.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
Are you saying that you never contacted the management at SDTC—you are under oath—and you never canvassed the management or any board members at SDTC to talk about funding for the company you are now president of?
5:55 p.m.
Chief Executive Officer, R-Hauz, As an Individual
Under the management, I might have spoken with one particular individual at one point about the possibility of a prior grant application made by Leith Moore, the CEO then.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
Madame Méthot, you're the managing partner, as you said, of Cycle Capital. I believe you are also the founder of it. It was founded, I believe, in 2009 with a focus on investment, private equity and buying ownership as a venture capital firm in green tech funds. Is that correct?
5:55 p.m.
Founder and managing partner, Cycle Capital, As an Individual
If I've understood your question, that's correct.
We are a private investor together with many investors in our funds.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
Thank you.
That includes some of your own, obviously. As any private equity firm does, it has the principal's money in it as well.
5:55 p.m.
Founder and managing partner, Cycle Capital, As an Individual
Yes, it includes my own money and that of my colleagues.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
Shortly after you founded the company, you hired the current environment minister, Steven Guilbeault, to work as a strategic adviser from 2010 to 2019. Is that correct?
5:55 p.m.
Founder and managing partner, Cycle Capital, As an Individual
Yes, Mr. Guilbeault worked for us as a strategic adviser starting in 2010.
5:55 p.m.
Conservative
Rick Perkins Conservative South Shore—St. Margarets, NS
That was until he was elected in 2019. Thank you.
You mentioned that you were appointed the board chair of SDTC in 2016, one year after the Liberals won the 2015 election, and you sat on the board until 2021. I believe that after you left that, you were appointed to the board of the Canada Infrastructure Bank. Is that correct?
5:55 p.m.
Founder and managing partner, Cycle Capital, As an Individual
Mr. Chair, I'd like to go back over a point, if that's possible.
Mr. Perkins, you said that Mr. Guilbeault worked for us until he was elected in 2019.
In fact, on June 17, 2019, we received a letter of resignation in the mail from Mr. Guilbeault stating that he was running for political office. We therefore terminated our business relations with Mr. Guilbeault as of that date.