Dear Editor,
Mark Twain once said, “Noise proves nothing. Often a hen who has merely laid an egg cackles as if she laid an asteroid.” That could well be said of the long-awaited announcement of the re-constituted GuySuCo Board of Directors.
Doubtless it would be useful to remind readers of what is wrong with the current situation. The fact is that the problem is not peculiar to the sugar corporation and the poor performance of state corporations packed with political appointees has, in many countries, led to a public outcry but often only after lasting damage has been inflicted on the institution and the taxpayers’ purse. In some cases the damage has been irreversible and that may well already be the case with GuySuCo and GPL.
The crisis of confidence as in Guyana has been the result of lack of accountability, absence of performance assessment of both Board and management, undue political influence, incompetence arising from failure to choose appointees based on merit instead of political allegiance and nepotism. A significant flashpoint arises from the role of the Minister in an opaque process of naming appointees.
In a bid to inform debate and reform in Australia, a review of international reforms was recently commissioned. The authors have identified three options aimed at improving transparency, rigour, competence and independence of boards via:
A minimalist model, examples of which may be found in Canada and NZ, which aims to leave the minister to make the appointment but requires public advertisement of positions and a selection process involving competent persons rather than the minister.
The second option, is to draw on a more radical model involving an independent authority to manage the appointment process and take the final decisions on appointments. “To ensure accountability, the process would be audited annually by the Commonwealth Auditor-General and the agency would be overseen by the Minister for Finance and Administration and/or the Special Minister.”
A third model may be found in the UK where that role is performed by an independent body, the Office of the Commissioner for Public Appointments. A code of practice would apply to all appointments and ministers would remain responsible for appointments and the management of appointment processes.
The GuySuCo case
Meanwhile during the course of the week in Guyana, Dr Luncheon in reacting to universal criticism of the announced GuySuCo Board members, would have us believe that all the world outside of Guyana is happy to pack state corporation boards with governments’ political appointees. As usual, such authoritative PPP pronouncements tell us more about the unreal world of the HPS and his colleagues than about what is taking place in the real world outside of Guyana.
The reality is that under the old Board, transfers to GuySuCo have risen exponentially in recent years and at this point in time there is no credible plan to get them out of that situation. Whereas in 2011 the Ministry of Finance (MOF) allocated some $209M to the company, in 2012 the figure had jumped to $4B, by 2013 it was $5.36B when the Minister had given the assurance that the $1B set out in the budget is all they would need. This year the figure stands at $6B.
After failing to make good assurances to effect improvements in the company’s performance the President agreed to replace the Board. One would have hoped that the President and the Minister of Agriculture would have made an assessment of the contributions the members of the last Board made to its work. Retaining members from the former Board should have been an exception and should have bene informed by the specific and useful skills they had been bringing to the Board.
GuySuCo’s performance would not improve without drastic change. The development plan for 2014-17 will have to be drastically revisited by the new Board because it is already redundant. Indeed Clive Thomas has suggested that the company may be beyond the point of no return.
Minister of Agriculture, Dr Leslie Ramsammy has announced that Shaik Baksh, currently Chief Executive Officer (CEO) of the Guyana Water Inc, has been appointed as Chairman of the Board of Directors of GuySuCo. In addition the following are to be members of the new Board:
Mr Dunstan Barrow, Chairman, Board of Directors, Linden Enterprise Network (LEN);
Dr Dindyal Permaul, Chief Executive Officer, Guyana Livestock Development Authority (GLDA); Mr Keith Burrowes, Executive Chairman, Board of Directors, Guyana Office for Investment (Go-Invest); Mr Badri Persaud, Managing Director, Guyana Oil (Guyoil); and Ms Geeta Singh-Knight. Dr Raj Singh, CEO, is an ex-officio member.
The Minister of Agriculture had publically agreed to bring persons to the Board with skills to help to resuscitate the company financially. It is unlikely that the $15B the company has received over the last 3 years alone to keep it afloat could be repaid. It has, in spite of that stock of debts, arrears to the income tax department and to the NIS not to mention trade creditors.
There has not any been an attempt to justify the retention of the specific former Board members. Given the importance of GuySuCo to Guyana and the amount of taxpayers’ money at issue, one would have expected the President’s advisers to have given some thought to identifying the specific skills needed for an effective Board. If any such thought has gone into these choices it is not evident.
A case in point is that of the new Chairman, Mr Shaik Baksh, who has a ’history‘ and is too closely associated with some major scandals involving books and school computers to be credible as a change agent for the kind of new directions needed by GuySuCo. Mr Baksh’s inclusion cannot be justified on the basis of his performance with two ministerial portfolios. Most commentators assume that it is a reflection of the PPP obsession with re-cycling loyal colleagues but Baksh’s relationship with his former colleagues has been too rocky to explain such a high profile post. We have therefore to look elsewhere for the reason. It is probably to be found in internal PPP politics and may be evident with the passage of time.
In similar vein, Ms Geeta Singh-Knight presided over the collapse of CLICO (Guyana). When the losses for which she was responsible were put to Mr Jagdeo on the occasion of the announcement of her first appointment to the GuySuCo Board he said in her defence that, “It’s not like it [the money] disappeared or was siphoned…The problem is it was the judgment, it might be bad judgment.” That bad judgment included breaking the law by undertaking overseas investment significantly in excess of what the laws of Guyana permit and for a considerable period it was known that she was in breach of the Insurance Act. For those reasons, Raphael Trotman of the AFC, had lambasted the decision to place her on the GuySuCo Board. Bad judgement is not normally an asset a responsible employer would seek out in recruiting staff, let alone Board members! Do we really need to bring to the Board someone who has proven to be so blasé about breaking the law?
The Guyana National Broadcasting Authority may not have broken the law under the tutelage of the current Board but its actions have not been without critics. In that sense Mr Permaul has been party to the pricing arrangement for a national asset that seems intended to share out those assets largely to owners clearly politically aligned to the PPP, thereby preserving the illegal decisions taken by the outgoing President Mr Jagdeo.
In March 2011 petrol dealers contracted to the Guyana Oil Company Limited (Guyoil) rebelled over what they described as arrogance displayed by the senior management of the company run by Mr Bandri Persaud. Once more I ask, is this the type of experience or management style that would be of help in the running of a company like GuySuCo where labour problems are so critical?
Also on the Board is Mr Keith Burrowes, whose inability or unwillingness to provide answers to press questions about the role of GO-INVEST, which he chairs, in relation to exceptional fiscal concessions received by Bai Shan Lin suggests no appetite for accountability in circumstances where the role of the entity in the process has been explicitly set out in government documents. He was Chairman of the Board of the Guyana Chronicle when one of its all too familiar racist editorials was published. His threat to resign and “… if my colleagues agree we will do so en bloc,” was never carried out when what he called a “slippage” was drawn to his attention.
Strength in diversity
In that regard, I note with more than passing interest that Mr Burrowes is one of two African-Guyanese members on the GuySuCo Board. Since places can hardly be found for African managers in the company, the appointment of African Board members can only be seen as window-dressing. When as Chief Planning Officer, I first interfaced with the GuySuCo executive, it had one of the most impressive and competent management teams in the country. It was also a most culturally diverse team. Those characteristics were not unrelated. Under Harold Davis, the management included Director and Financial Controller, Mr Alan Luck an outstanding accountant and his understudy at the time, Mr Errol Hanoman. The venerable Mr Clarence Ellis and I worked especially closely with these managers in the context of the Cabinet Economic Sub-Committee. The same applies to D P Sankar, the Industrial Relations Director and his negotiating team including Mr Latchmie Narine. I recall Mr Biguyan Chandra Agricultural Director; Mike Glasford, Technical Director. At one stage Mr Lendore, a Trinidadian engineer with a Guyanese spouse, ran the Port Mourant Training School. I also had the opportunity to work briefly alongside Vibert Young Kong on technological change. He, like Hanoman, and Glasford subsequently made a name for himself in the industry outside of Guyana, as a formidable engineer. Of course Ian McDonald, an outstanding novelist and writer in his own right, was in marketing and along with Colin Campbell took care of the international end and the Lomé arrangements.
I make what may appear to be a diversion to underscore the capacity, reputation, depth and diversity of that GuySuCo team. In those characteristics lay its strength.
The poor performance of the company, its Board and management is not a coincidence, it is self inflicted and arises in part from reckless and socially irresponsible behaviour of this kind. In one swoop over less than 20 years the Board has managed, no doubt at the prompting of the PPP, to create a de facto homogeneity that is dysfunctional and poisonous.
The precipitate disposal of formally qualified personnel and loss of institutional memory have taken a toll on an industry faced by unprecedented changes. The much vaunted and unrivalled traditional expertise in labour management, logistics and agronomics to which I have made reference has been dissipated. Poor financial management, ill-informed investment decisions, conflict of interest and corruption at the point of procurement has left it badly wounded. The roots of these problems lie at the interface of government, the Board of Directors and management. Much of what else is wrong with GuySuCo has been identified by GAWU in recent years.
GuySuCo now needs a Board whose members have been carefully selected with the personal integrity to be able to avoid financial conflicts of interest, members who collectively bring expertise in large scale labour management, familiarity with best practices as regards both self-assessment as well as goal setting and performance assessment for management. Precisely at the point when the company is in crisis it needs to mobilise the richness of the community as a whole in which it is embedded.
Workers’ representative
While I fully agree with the calls by Mr Komal Chand of GAWU for restructuring the Board and for professional management of the entity, I think that the absence of a workers’ representative would be unfortunate given the circumstances in which the company is currently placed. Of all the unions in the Caribbean, GAWU has a record of being the most militant in pursuit of political and labour ends. It is ironic then, that a political party whose battles they have so often fought should have brought the industry to a sorry state and should have engineered a Board without a single worker representative. In the 1980s, GuySuCo employees elected workers’ representatives and they had representation on the Board of Directors. Their absence from the Board at this stage would not help the company and one hopes that the PPP and the government recognise the errors of their ways before it is too late.
Herdmanston
I turn finally to Mr Dunstan Barrow’s inclusion on the Board. Mr Barrow, former CEO of Guymine, was until recently a member of the GGMC Board. The government has sought to cushion that removal by this appointment. Barrow brings considerable experience in management and accounting to the Board. His strength is of course mining rather than sugar. My issue with his inclusion is not his skills or baggage but the political end the appointment is intended to serve.
The government is supposed, under the 1998 Herdmanston accord and follow-up, to invite and appoint to the state boards and committees, opposition members. But true to form the government has failed to implement many elements of the agreement. One such lacuna is the nominee to the GuySuCo Board. Since 1999 the government has refused to appoint the PNCR’s nominee to the GuySuCo Board, Mr Anthony Vieira, a former PNCR MP, engineer and former manager of GuySuCo.
The appointment of Mr Barrow, a former PNCR MP, without reference to the opposition is probably intended to give the public the impression that that outstanding condition has at last been met. Not so! They are hoping that the opposition would be reluctant to attack Mr Barrow on a Board with so few African-Guyanese, especially when it has been complaining about discrimination elsewhere. Once again they are wrong.
Conclusion
Can this Board make a difference? More importantly, is the President’s proposal a serious one? These state boards are seen by the PPP as a refuge or sinecures for loyal servants. Some have had to be moved from elsewhere as a result of unsatisfactory or embarrassing performance. Thus the most obvious characteristic feature of the membership is that it largely reflects the re-cycling of cronies.
Obviously the PPP regime has no intention of tackling the main reasons for the GuySuCo crisis, poor decisions taken by the Board and the failure to protect management from debilitating political interference. The President undertook to appoint a Board that is professional, competent and charged ultimately with improving the financial situation of the company. He has not done so.
I fully understand therefore why Mr Chand, who probably has a better understanding of the industry than anyone else named to the Board, has refused to serve. The Board’s composition is highly unsatisfactory. Having been in labour and overdue for six months, the elephant roared and brought forth a mouse!
This mouse is likely to be about as effective as the emperor’s new clothes! In the light of this and indeed of all the foregoing, the PPP government should harbour no illusions about the likelihood of parliamentary support of future requests for funds for GuySuCo.
Yours faithfully,
Carl B Greenidge
