Audit Chamber report about directors-appointments: “Lack of transparency and integrity is worrisome”

August 2, 2017

GREAT BAY – The government, as shareholder of government-owned companies, was mostly ignoring the rules for the appointment of directors to these companies, it appears from an audit published by the Generaaul Audit Chamber. Only one of the 23 appointments the chamber reviewed was found to be transparent and in compliance with the law. Ironically, that one case was the appointment of the late Ir. William brooks as the CEO of utilities company Gebe on December 3, 2015.
Brooks’ tenure at Gebe lasted only until January 29 of the following year. The appointments of his predecessors, Romelio Maduro and René Gartner, and his successor Andrew Zagers were pushed through without the required advice from the Corporate Governance Council.
For the appointment of the current management team – Kendrick Chittick, Iris Arrindell and Veronica Jansen-Webster, such an advice was sought, but the Audit Chamber could only establish that the Corporate Governance Council had asked for additional information about these directors- not that the advice had been completed, let alone respected.
And even so – the Audit chamber found more worrisome information. For just seven of the 23 reviewed appointments there was an advice from the Corporate Governance Council, but in four of these seven cases the responsible minister did not follow this advice.
“We were unable to establish whether the minister provided a reason, in writing, for failing to follow the advice in those four cases,” the Chamber writes in its report. “It should be noted that the four appointments in question occurred after the publication of our first report on administrative appointments in October 2016.”
The report refers here to the appointments of the Gebe management team (Kendirck Chittick, Iris Arrindell and Veronica Jansen-Webster) and of TelEm director Kendal Dupersoy.
This remark seems to emphasize that the ministers who made the appointments were well aware of the shortcomings in the procedure and did nothing to improve the situation.
When the government appointed Regina Labega as the director of the airport on July 1, 2011, she was already a suspect in the embezzlement investigation at the Tourist Bureau. This fact alone should have blocked the issuance of a declaration of no objection (after an investigation by the national security service VDSM), but that investigation never took place before the appointment. It happened only a couple of years later and it forced Labega out of her job.
Labega is only one of a long list of directors that were appointed without the mandatory Corporate Governance Council advice. The others mentioned in the report are the airport’s deputy managing director Larry Donker, Postal Services director Antonia Wilson, Postal Services finance director Alex Richardson, Economic Development Corporation director Ursula Gumbs, port director Mark Mingo, as well as the port’s chief financial officer Ton van Kooten and chief operations officer Richard van der Mark, St. Maarten Laboratory Services director Nasser Ajubi, the TelEm top: Helma Etnel, Eldert Louisa and Brian Mingo and Winair director Roberto Gibbs.
For the appointment of TelEm-director Kendall Dupersoy advice from the Corporate Governance Council was sought, but it is unclear whether this procedure was satisfactorily completed: the report shows that the council asked for additional information about the candidate.
The report reveals again a disturbing lack of cooperation from the government with the Chamber’s audits. Repeated requests for information to the (then) acting minister of tourism, economic affairs, traffic and telecommunication (Rafael Boasman) fell on deaf ears. While the Chamber sent out requests for information on February 9, 2017, Minister Jacobs (Education) only reacted on June 16 and Minister Lee (Public Health) on July 17.
The Chamber’s conclusion of this audit: “The lack of transparency and the associated lack of integrity regarding the appointment of directors is worrisome.” Furthermore, the report states: “The lack of cooperation, transparency and legal compliance is disappointing. Except for the 2015 annual reports from SJIB and VKS it is likely that ministers do not possess up to date documentation (such as annual reports and yearly statements) which they should have as representatives of the country. Without up to date documents it is impossible to understand the (financial) situation within government-owners companies.”
For this audit, the Chamber requested annual reports for all entities under review. It received only reports from the Stichting Justitiële Inrichtingen Bovenwindse eilanden (SJIB) and from the Voluntary Corps St. Maarten (VKS).