It’s election year and political parties are out for blood; hoping to get something on their opponents. Conservatives and the NDP have smelled blood with the recent shift of Ms. Jody Wilson-Raybould from Minister of Justice to Minister of Veterans Affairs. The media and Conservatives allege that the Prime Minister’s Office made this change because Ms. Wilson-Raybould refused to consider use of a “non-prosecution agreement” that could avoid the possibility of banning SNC-Lavalin from bidding on any federal contract for 10 years, as punishment for bribing officials to get a contract in Libya.
It should be noted that Britain, the US and Australia have found that, provided the defendant agrees to cooperate, to pay appropriate fines and to take appropriate action against involved employees, non-prosecution agreements are an effective way of combatting corruption in large organizations without applying capital punishment to valuable strategic assets and to the thousands of other employees who had nothing to do with the crime.
In the case against SNC in Libya, fines have been paid, several SNC executives including the rogue executive in Libya and the CEO have been fired, and the SNC Board has implemented new corrective procedures. SNC now questions how much more punishment is necessary for its other 61,000 employees. Many US politicians want to ban Canadian companies from bidding on state and federal contracts in the USA. Banning SNC from federal contracts in Canada could be a fatal blow.
SNC-Lavalin, originally called Dominion Bridge, has been a flagship Canadian company since 1911 and is now a valuable strategic asset to Canada with offices in 50 countries. It is one on a very short list of Canadian Engineering and Construction firms with the capacity to operate on the world scale. Stephen Harper’s Conservative government privatized the former Atomic Energy Canada to better enable those world-class assets to compete outside of Canada. SNC was the successful bidder and is now building a fourth-generation advanced nuclear-energy plant in China. A major global expansion of nuclear power is essential to combatting climate change and offers great potential to Canadian research and business.
It’s a very tough world out there. Canada has a relatively small population which limits economies of scale for even our biggest companies. To flourish, our biggest companies must do business outside of Canada. Canada has only 12 companies on the Fortune 500 list of the World’s biggest companies in terms of revenue. The 12 from Canada rank from #274 to #483 on the list. Neither SNC nor Bombardier, Canada’s only manufacturer of aircraft and railway rolling stock, make the Fortune 500 list.
Ultimately, corruption does not pay. Corruption undermines democracy, facilitates crime and terrorism and saps economic growth. 181 counties agreed with the 2003 UN Convention Against Corruption. Certainly, there must be consequences for engaging in corruption. But only 20 of those 181 countries including Canada are classed as full democracies. The other 161 are classed as flawed democracies or autocracies. Notwithstanding the UN Convention, bribery is still endemic in most underdeveloped countries. Ten well-known US companies, including Walmart, GE and Halliburton, have been charged with corruption under the UN convention. There have been fines and firings, but is there any indication that any of those companies have been banned from doing business? If SNC were to fail, which country would acquire those valuable assets?
Canada likes to be the world’s Boy Scout, but we should not let that destroy us. Opposition Parties should be careful. They could come to regret any short-term political gain they might achieve through this case. Without using a non-prosecution agreement, this case could grind on for a year or more. Any elected party could find itself dealing with the fallout of the SNC case or other such cases affecting important business in any part of Canada.
What if the real reason that Ms. Wilson-Raybould was shifted had nothing to do with SNC, but was to remove her from having to take a very difficult and sensitive stand against her father who is a hereditary chief of a BC First Nation? Several BC hereditary chiefs are attempting to block construction sites for the biggest natural gas pipeline project in Canada’s history, even though the elected chiefs are in favour of the project. Is that not a form of corruption? Queen Elizabeth is a hereditary chief. Her job is to ensure the orderly transition of governments. It is not to thwart the will of the people by overruling their elected representatives. The job of the hereditary chiefs should be the same as the Queen. If not, how can First Nations govern themselves? What would the Conservatives or the NDP do about that?
Hugh Holland is a retired engineering and manufacturing executive now living in Huntsville, Ontario.
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