Public Accounts Committee on Dec. 11th, 2025

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

Okay. Thank you, Chair.

[The Vice-Chair, Liberal, Jean Yip]

Thank you.

Mr. Deltell, you have the floor for five minutes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Thank you very much, Madam Chair.

It is now my turn to thank all my colleagues and the entire team, including the interpreters, who do an excellent job, the technicians and the law clerks, who enable us to do a very good job—at least we do our best. We wish them a very happy holiday season.

Mr. Roy, I want to talk to you about conflicts of interest, because you touched on it in your testimony. The Auditor General, in paragraphs 5.48 and 5.49 of the report, says that businesses do not necessarily have strict rules and that some need to be put in place.

As we said earlier, the organization you represent is neither a Crown corporation nor a department. It is the Public Sector Pension Investment Board. That means that you invest millions of dollars in companies.

Can you give us a case that might represent a conflict of interest?

[Alexandre Roy]

A conflict of interest case could arise, but it did not occur at PSPIB: A contract could be offered by an acquaintance, a partner or a friend of a PSPIB employee. At PSPIB, we have to declare all potential conflicts of interest on a quarterly and annual basis, as well as before a contract is signed, if it exceeds certain thresholds, based on a risk-based approach. In other words, the riskier the contract, the higher the level of scrutiny.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

You are making investments in private companies. For example, you buy shares in companies in the hope that they will increase in value. Is that correct?

[Alexandre Roy]

Yes, absolutely.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

If an employee suggests buying shares in a company that he owns shares in himself, will you arrest him or ask him to sell his shares?

[Alexandre Roy]

Generally speaking, the compliance team at PSPIB ensures that this type of situation does not occur.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Let us suppose that a person does business with a financial institution and that they do not know the exact investments that are made by that institution. That is what I do, personally. So I do not know the shares that are being purchased.

At PSPIB, do you have a specific procedure for these people?

[Alexandre Roy]

I am not sure I fully understand your question. It should be noted that as PSPIB employees, we cannot purchase shares in companies that PSPIB invests in.

There is also a pre-audit related to PSPIB's investments.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Mr. Hayes, if a member of the executive of the Canadian government owned shares in McKinsey, would there be a conflict of interest?

[Andrew Hayes]

It would depend on the circumstances and the contract. If that person has the power to make decisions, it is possible.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Let us say a member of the executive owns $7 million worth of shares in McKinsey.

Could the government continue to do business with McKinsey?

[Andrew Hayes]

I am not in a position to answer that question. I do not know the facts.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

It is not a fact; it is a hypothesis.

If a member of the executive holds shares in a company that has very large contracts with the government, as you so clearly demonstrated in the case of McKinsey, is that member in a conflict of interest?

[Andrew Hayes]

Again, I cannot answer that question without knowing the details and the measures in place, such as conflict of interest screens, to ensure the independence and objectivity of the individual.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Let us say a member of the executive of the Canadian government owns shares in a certain company. Could it receive government contracts?

[Andrew Hayes]

There is no reason to exclude this company from contracts. The most important thing is to declare conflicts of interest, so that the government and public servants can resolve them.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Should we ask the member of the executive of the Canadian government to sell his shares in order to ensure that there is no conflict of interest?

[Andrew Hayes]

I think that is a question for the Conflict of Interest and Ethics Commissioner. I am not an expert on that.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

You were nevertheless effective in your analysis of conflicts of interest in the departments and Crown corporations that were managing with McKinsey.

As you so aptly demonstrated, McKinsey does a lot of transactions with the government and has major ethical flaws. How is it that some members of the executive can still have shares in McKinsey?

[The Vice-Chair, Liberal, Jean Yip]

Please give a short answer.

[Andrew Hayes]

I think the Conflict of Interest and Ethics Commissioner would be in a better position to give you an answer to that question.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Thank you.

[The Vice-Chair, Liberal, Jean Yip]

Mr. Lemire, you have the floor for two and a half minutes.