Natural Resources Committee on Nov. 20th, 2013

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Okay, thank you. I'm not sure that answers my question.

My second question is for Mr. Bateman.

I note that you served as the vice-president of legal for ENMAX. Do your foresee any conflict or potential for allegations of conflict or bias if you sit on any electricity export applications?

[Kenneth Bateman]

I don't. I believe I have a clear understanding of the requirements to be neutral and to be impartial. The training that all board members receive, both by experience and by practical direction, stipulates that the board is quasi-judicial. That means we are independent and we must at all times ensure we are free from bias. As that is ingrained into us, we have the capacity and the discipline to ensure that when we're required to make decisions, we separate ourselves from those potential inclinations or risks. I believe when we are serving the public interest in particular, we must do so, and I believe that practice will carry forward into any other responsibility in the future.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Mr. Bateman, I also note, and I am encouraged by this, that you state in your CV that you have a sound understanding of aboriginal law as well as related constitutional principles. Given that knowledge, do you view that part of your mandate in the NEB would be to make determinations on aboriginal rights and title, and do you feel you have the qualifications to do that?

[Kenneth Bateman]

Thank you for that question.

I do have an expertise on the legal dimension of that. It is important, though, that the board does not make a determination, nor does it have jurisdiction to make determinations with respect to questions of title. That's a constitutional matter. It, at times, creates confusion and frustration in the hearing process, a scenario in which I believe the board strives to ensure that there is appropriate engagement, which is different from crown consultation. While I believe that my expertise covers the breadth of that, it also provides me with the clear capacity to understand the distinction, and to bring that knowledge and skill to decisions, into the hearing room, and also to assist board members as they make decisions as a panel.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

I'd like to go back to Mr. Parrish.

You have extensive experience in working with northern aboriginal communities. Do you see your experience and credentials as equivalent to the appointment of an aboriginal representative?

[Shane Parrish]

Oh, boy. I'm not sure how to comment on that. I will say that there have been aboriginal members appointed to the board. Is that equivalent to appointing an aboriginal representative? I don't see things that way, I guess. I'm who I am, and I'm quite happy with who I am.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

I'm not questioning you. You obviously have a lot of high credentials. I guess my question is that it is very clear from your resumé that you've had a lot of experience in the north and with aboriginal communities, and I presume that's part of the reason for the appointment. I'm just wondering if you feel comfortable with that, and if those are the credentials upon which you've been appointed.

[Shane Parrish]

I think the question of my appointment is better asked of the people who hired me. Why they chose me or didn't choose me is a question better posed to them.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

That's a very fair response, and we wish we could.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you very much for that response.

Thank you all, gentlemen, very much for being here today, for your short presentations, for giving background on yourselves, and for the answers to the questions. We do appreciate all of that very much. Your participation in the meeting is now over.

The committee, however, has some business to conduct.

Before we suspend to go to the second session, you've all received a copy of the motion that we can pass today. Would it be agreeable to all members of the committee that we just put all four names into the motion and deem them to have been dealt with separately, for the sake of time? Is there agreement on that?

[Some hon. members]

Agreed.

[The Chair, Conservative, Leon Benoit]

(Motion agreed to)

Thank you all very much. Those appointments will be reported to the House.

Were there some questions?

[A voice]

Was the motion carried?

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Do we have to make a motion?

[The Chair, Conservative, Leon Benoit]

I just deemed it to be carried. I asked if everybody had read the motion, and I asked if it was agreed that all four names would be dealt with together. We could deal with it separately if you'd like, but it does the same thing and that's why I asked for consent.

Thank you very much.

We will suspend this meeting until we get our next witnesses in place. Then we will have roughly three-quarters of an hour to have them make their presentations and ask them questions.

[The Chair, Conservative, Leon Benoit]

Okay, let's reconvene the meeting. We will start the second half of our meeting.

Rounds will be five minutes, but the same order as if we're starting a meeting. Is that agreed?

[A voice]

Yes.

[The Chair, Conservative, Leon Benoit]

Okay, what we will do then is have five minutes of questioning, no seven-minute rounds, but we will proceed in the same order as though we were starting a new meeting. Very good, and Mr. Regan gets an opportunity to ask questions, too.

Today by video conference we have from Waterloo, Ontario, Mr. James Laurence Balsillie, who has been appointed chairperson of the Canada Foundation for Sustainable Development Technology. Welcome to you, sir.

[James Balsillie, Chairperson, Canada Foundation for Sustainable Development Technology]

Thank you very much.

[The Chair, Conservative, Leon Benoit]

We also have with us today by video conference from Toronto, from Atomic Energy of Canada Limited, Mr. James Hall, who has been appointed director.

We are going to examine these two appointments together, so I will ask each of you gentlemen to give a roughly five-minute opening statement laying out your backgrounds, your qualifications, that type of thing, and we'll start with Mr. James Balsillie.

Go ahead with your presentation, please, sir, for up to five minutes.

[James Balsillie]

Thank you, Mr. Chairman.

Thank you to the members of the committee for giving me the opportunity to appear today. It's an honour to appear with such a distinguished group, and with another distinguished appointee like Jim Hall.

As you likely know, I have a deep interest and experience in taking concept technologies to global markets. What you may not be aware of is my profound interest in energy and sustainability both here in Canada and globally. Having represented both Canada and the global private sector on the United Nations Secretary-General's High-level Panel on Sustainability and founding and chairing the Centre for International Governance Innovation, I've contributed to leading discussions on striking the right balance between immediate economic pressures fuelling global growth and ensuring that our planet remains sustainable for generations to come.

Sustainable Development Technology Canada, or SDTC, is a natural crossroad for my various interests, experiences and skills, from the commercialization of clean technologies to the broader public policy surrounding competitiveness. The fact that SDTC exists and was recapitalized in Canada's economic action plan in 2013 to the tune of $325 million over the next eight years was, in my eyes, a clear signal from the Government of Canada. It was an indication that they're serious about ensuring that we, Canada, have a balanced energy portfolio and that we are committed to investing in economically viable clean technologies to power our country and the world in a sustainable fashion for generations to come.

When the opportunity arose to serve as chairperson of SDTC, I felt a deep sense of pride. It was pride not only to serve Canadians, but also to assist the entrepreneurs SDTC works with every day for trail-blazing in technologies that have the potential to create high-skill, high-paying jobs in communities across Canada.

Since the Government of Canada announced my appointment as chairperson of SDTC earlier this year, I have immersed myself in the organization. It has become clear to me over the past few months that the projects SDTC invests in are helping to commercialize innovative technologies, capitalizing private sector investment, delivering a quantifiable environmental impact, and employing more and more Canadians in the clean-tech sector.

There are many parallels between the work I'll be doing with SDTC and my previous professional experience. Technological innovations can transform whole industries. They often encounter competition, and are faced with many potential pitfalls along the way. SDTC gives small and medium-sized enterprises opportunities that would otherwise be lost in the innovation gap. The organization is playing a vital role in helping to bridge the gap for innovative technologies that need a boost to get from the laboratory bench to commercial viability.

SDTC is adding value to the clean-tech sector in Canada and is much more than solely the investments they make in early stage technologies. For leading academics, financiers, entrepreneurs, and government officials, it serves as a hub to incubate ideas and technologies. The organization's experts follow these projects from their first application right through to completion. After investing in their project, SDTC helps companies raise the necessary financing and secure that important first customer. With one of the largest portfolios of clean-tech companies in the world valued at over $2 billion, SDTC is helping Canada maintain its global leadership position in the field, and the organization is delivering tangible results. Twenty-two SDTC-supported companies currently in the market are projected to have $5 billion in revenue and create 24,000 jobs by 2015.

I must take this opportunity to say that from what I've observed, SDTC is doing all of this in a frugal fashion. The management team is committed to ensuring that they are a pan-Canadian organization accountable to Parliament and to Canadians. They've also demonstrated to me that they are committed to strong oversight of the companies they fund, while limiting excessive overhead expenditures so that the dollars they have can be maximized. From my experience, these are all vital components of successful organizations.

Let me conclude my remarks by saying that risk-taking contributions to Canada's competitiveness and global sustainability are recurring themes throughout my career. I have an affinity for SDTC, its mandate and its people, because I believe we share these traits.

The entrepreneurs that SDTC invests in have taken a major risk personally and professionally to bring their innovations to market to the benefit of all Canadians. SDTC has a strong track record for delivering economic and environmental benefits for the Government of Canada and Canadians.

My hope is that I can play a part in helping the clean-tech industry in Canada in a way that contributes to sustainable economic growth for generations to come.

Thank you again for the opportunity to speak with all of you today. I'm certainly pleased to answer any questions you may have.

Thank you, Mr. Chairman.

[The Chair, Conservative, Leon Benoit]

Thank you very much for your presentation, and indeed for being before the committee by video conference today.

Now we go to our second witness in this second hour, Mr. James Hall, appointee as director of Atomic Energy of Canada Limited. He is with us from Toronto by video conference.

Go ahead please, sir, with your presentation for up to five minutes.

[James Hall, Director, Atomic Energy of Canada Limited]

Thank you, Mr. Chair.

I would like to repeat Mr. Balsillie's remarks regarding what an honour it is to appear before you. Because my background is not quite as public as the former witness, I think I'll go through my professional and board background as a beginning to this interview.

I graduated from the University of Western Ontario, from the Richard Ivey School of Business HBA program, in 1971. I went off to Arthur Andersen to get my CA. After working in audit for a number of years, I was invited to transfer into the insolvency division. While there, I worked on a number of restructurings, special investigations, and receiverships until 1984 when I had an opportunity to go off to Citicorp and work for Citibank Canada, which was just setting up a leveraged buyout unit in Canada.

I went there because they needed someone who knew something about doing a liquidation analysis in Canada, and my insolvency background fit that, and also I was somebody who could do deals. I was a transactor at Citi in the beginning and then became a team leader and did a number of transactions. The two that are still around that you would recognize are VersaCold, which was Versatile Cold Storage back when I did it, out in B.C., and Héroux-Devtek now in Longueuil. I also did a lot of Citicorp's workout work, special bad loan work, non-real-estate related, as part of my duties there.

In 1989 I got an offer I couldn't refuse from Lloyd's Canada. It had been in business here for a couple of years and was having problems with its bad loan area. I was asked to see if I could go in and straighten it out. I did that on a special contract. It took about six months. Things were in pretty good shape, and then they announced they were trying to sell the bank. They asked me to go off and run the Toronto main branch, which was perfect for me because I knew absolutely nothing about running a branch, and I have to say I wasn't that interested in learning, but I did that until the bank was sold.

Then I went off to a start-up, Working Ventures Canadian Fund. Only three people were there when we got going. There was no money. There was no staff. There was no deal flow. It was basically a blank page on an idea that we could run a retail venture capital operation in Canada, similar to but not exactly the same as the Solidarity Fund in Quebec.

We started off, and the first year was a complete capital raising disaster. We hardly raised any money at all, I think about $1.6 million, but the next year, in 1992, we did a little better with $33 million, and by 1996 we were just short of $900 million. During my 12.5 years there until December 2002, I was responsible for investing a little over $700 million in 217 deals and probably 300 or 400 follow-ons to those deals, which is the way it works, and the management company was sold to a competitor in 2002. I had a non-compete, so I could go off and work on boards, and then I began to do some more of that work. I had a lot of board experience at that point, but this was an opportunity to focus on that.

I think you've got my CV, so I won't go through the boards I was on and then off. One of them, Journal Register Company, which is in Philadelphia, that I got on because I was recruited through a hiring agency in New York, was in the newspaper business. They had somewhere around 350 publications in eight states. It seemed interesting, and that's where I went.

In 2007, the CEO had medical issues and had to go into clinical trials, so the board said, “Jim, maybe it would be a great idea if you would become the acting CEO until we can find a new one.”

At that time, all newspaper companies in the U.S., and a lot of them in Canada, had declining revenues. By the fall of 2007, you could not sell a newspaper property if you had too much debt, and you could not hire anybody to come in and straighten things around, so the board asked me if I would be the permanent CEO. I said I would, but on the condition that I would not be moving to Philadelphia, because sooner or later, we were going to blow our leverage covenant with our 38 banks, against our $700 million in debt, and we were probably headed for chapter 11.

To make a long story short, we filed under chapter 11 in February 2009. The Philadelphia Inquirer, the big newspaper in Philadelphia, filed the next day. I think the Chicago Sun Times went a month later. The Chicago Tribune had gone the December before. Newspaper business was pretty hard, and still is right now.

I was done working in the office in March of that year, although I was paid until September and was on standby in case things came up with the bankruptcy court.

I came back to Toronto and went back to working for myself. I had done a lot of M and As work, and as you can see from my resumé, some special investigations work as well along the way. I've done a lot of board work, and continue to do a lot of board work.

I'm very happy to be on the Atomic Energy Board, because this restructuring they're doing is probably one of the largest, most complicated, most interesting restructurings ever done in Canada.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Hall.

We go now directly to questions and comments, starting on the government side with Ms. Crockatt. Go ahead, please.

[Joan Crockatt, Conservative, Calgary Centre, AB]

Thank you very much.

I appreciate both of you being here. You bring a range of very interesting experience to these jobs, and I appreciate the fact that gentlemen like you will come and consider working on behalf of all of us, so thank you very much.

Mr. Balsillie, I enjoyed the passion in your presentation today. One of the things that I believe we need a competency in is people who can communicate that passion for our high-tech sectors to the public out there so they can, as you said, get that boost to get from the lab out to the public.

I wonder if you can talk about your competency in communication, and how you feel this will directly benefit this position.