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Key SDTC Resignations Raise Oversight Questions for Trudeau Government

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A mass exodus of Trudeau appointees is underway as senior leaders hand-picked by the PM hurry to exit a taxpayer-funded sustainability agency rocked by ethical corruption.

One by one, the chair, CEO, and directors of the Sustainable Development Technology government agency selected by Trudeau are abandoning ship following damning investigations into misconduct.

Taxpayer-funded SDTC is now leaderless after supposed champions of clean tech funding were found playing fast and loose with a $1.6 billion public purse.

Secret recordings reveal officials were ready to “clean house” long before public findings, so why were there no firings by Trudeau’s ministry before whistle-blowers released damning evidence to the public?

Resignations signal accountability avoidance as Trudeau’s hand-picked leaders make hurried exits rather than face consequences.

How much did the Trudeau government know about inappropriate funding allocations and conflicts of interest?

The resignation of SDTC’s chair, Annette Verschuren, marks the departure of the second senior leader from the organization amid troubling findings about its operations. 

As stated in her resignation letter to Industry Minister François-Philippe Champagne, Verschuren will step down from her role as SDTC board chair on December 1st.

This resignation comes just days after the federal ethics commissioner announced he would investigate Verschuren’s involvement in providing $38 million in pandemic relief funding to companies within SDTC’s portfolio, including one she heads as CEO.

Her resignation letter acknowledges the controversy, with Verschuren writing, “While I have faithfully and fully committed myself and my decision-making to serve the organization’s best interests, it is time for me to step aside.”

According to Verschuren’s letter, she intends to use her remaining two weeks to deliver the results of a management action plan ordered by Minister Champagne in response to the investigation’s revelations. This plan’s completion is required before SDTC can resume granting funds, which has been suspended, much to the detriment of clean-tech startups relying on the agency’s backing.

The resignation of SDTC chair Annette Verschuren is the third high-profile departure from the organization in recent weeks amid troubling findings about its operations. 

As mentioned in her resignation letter, former SDTC CEO Leah Lawrence stepped down over a week ago on November 21st. In her own statement, Lawrence cited being subjected to “a sustained and malicious campaign to undermine” her leadership as the reason for her untenable position and decision to resign.

Lawrence’s claims of an internal attempt to damage her reputation raise further questions about the culture and conduct within SDTC’s senior leadership. Her resignation followed the earlier departure of fellow director Jessica McDonald, who resigned from the SDTC board a week earlier.

The cascade of resignations from three senior leaders at SDTC in the wake of an investigation into misconduct raises pointed questions about oversight by the Trudeau government. 

Chair, CEO, and director all abruptly depart as the ethics probe uncovers evidence of inappropriate funding allocations and conflicts of interest. The timing looks like a coordinated effort within SDTC’s leadership to avoid accountability once malpractice was exposed.

The resignations of SDTC’s senior leaders follow revelations about deeply troubling practices in allocating substantial amounts of government funding. As a federally funded non-profit, SDTC has granted a massive $1.6 billion to Canada’s environmental technology sector since 2001. 

Yet Verschuren acknowledged providing nearly $38 million in pandemic relief payments to SDTC’s portfolio companies in 2020 and 2021 without properly recusing herself, despite heading one company receiving $217,000. 

This enormous funding power wielded by SDTC, coupled with admitted lapses in ethical oversight, should raise alarms about how responsibly this taxpayer money is managed. The failure to detect such overt conflicts of interest until an external investigation is malpractice and misuse of public funds within the Trudeau government, which directly appoints SDTC’s leadership.

Just days before resigning, SDTC chair Annette Verschuren and CEO Leah Lawrence staunchly defended the organization against an ethics investigation alleging misconduct despite substantial evidence against them.

The allegations of misconduct at SDTC gained credibility from the independent investigative report compiled by the reputable accounting firm Raymond Chabot Grant Thornton (RCGT). As an established third-party auditor with no prior affiliation to SDTC, RCGT offered an impartial perspective untainted by any conflict of interest. This contrasts with the separate internal review cited by SDTC leadership conducted by law firm Osler, which has an ongoing relationship with SDTC as its legal counsel.

Verschuren dismissed the extensive third-party RCGT report as “inaccurate,” claiming it “contains numerous errors, and misrepresentations of our policies and procedures.” She cited a separate internal SDTC-commissioned review by law firm Osler that supposedly found no wrongdoing, despite Osler’s clear conflict of interest as SDTC’s own legal counsel. Verschuren even complained the RCGT interviews were “much shorter and less exhaustive” than Osler’s, grasping at straws to undermine the credible external investigation.

Similarly, Lawrence categorically stated “My leaders have acted ethically at all times,” rejecting any possibility of impropriety. She asserted “Our organization has played by the rules, improved the rules, and achieved results for Canadians.”

RCGT was specifically hired to thoroughly examine the whistleblower complaints through a fair lens. As Industry Ministry spokesperson Sean Benmor confirmed, “the department hired a reputable firm to conduct a thorough fact-finding exercise.” The choice of a detached external reviewer like RCGT underscored the investigation’s seriousness and integrity.

As Verschuren attempted to argue, RCGT’s interviews may have been less exhaustive than Osler’s, but an independent entity without built-in bias was far better positioned to objectively evaluate the evidence. 

Recorded conversations between whistleblowers and Assistant Deputy Minister Douglas McConnachie revealed the Industry Ministry’s loss of confidence in SDTC’s leadership long before the final report. 

In a late August discussion, McConnachie described the situation as “untenable” stating the board and management had “lost the confidence” of the ministry based on investigators’ early findings. He bluntly said “There has to be a cleaning of house.”

McConnachie expected Minister François-Philippe Champagne would “flip out” upon learning details of the misconduct uncovered, saying “The board does not have our confidence, and the board – the current board anyway – is not going to be in a position, and the management for that matter, to remediate the problems that have been identified.”

He suggested bringing in outside “caretaker management” on an interim basis to replace the tainted leadership. As McConnachie stated, “the operative question is how does that get done and how quickly can it be done?”

However, when the RCGT report arrived in October, Minister Champagne kept SDTC’s leadership in place under Annette Verschuren and Leah Lawrence. He only suspended funding abilities pending their completion of corrective measures.

This funding freeze is part of the “corrective action” he mandated along with a management plan for SDTC to address issues identified by December 31st.

However, clean technology groups have expressed concern about the freeze, as SDTC plays a vital role supporting new ventures in the sector.

As a key backer of early stage innovation, SDTC’s funding abilities are seen as critical for Canada to meet its 2050 net zero emissions target. The suspension of SDTC’s financing capacity, even temporary, could hamper the development of promising clean tech companies.

Ethics committee members questioned why Minister Champagne did not fire SDTC executives or board members despite issues flagged in the investigator’s report.

Conservative MP Michael Barrett directly asked Champagne “You have the power to fire the chair, and you have the power to fire the board – you’ve just said in your opening statement that you’ve taken all reasonable steps – I haven’t heard yet that you’ve fired anyone. Who have you fired?”

In response, Champagne stated “I would certainly caution members of this committee to apply due process when you’re looking at allegations.” He said he commissioned the investigation report once becoming aware of allegations.

Champagne defended not immediately firing anyone, saying he worked on the basis of evidence and due process.

However, he clearly had the authority to terminate SDTC’s chair, CEO, and board members. The fact he did not exercise this power despite the investigation confirming issues suggests a reluctance to take more aggressive accountability actions.

The cascade of resignations from SDTC’s top officials as misconduct allegations surfaced raises deep concerns about the Trudeau government’s oversight and commitment to accountability. Despite clear evidence from an independent investigation of inappropriate funding allocations and conflicts of interest, Minister Champagne notably did not exercise his power to terminate the responsible chair, CEO and directors. His reluctance to decisively clean house appears aimed at avoiding political embarrassment rather than enforcing consequences.

While Champagne cites due process, recorded conversations reveal his own ministry officials had already lost confidence in SDTC’s leadership months before the public report. The fact that chair Verschuren and CEO Lawrence were not fired or forced out earlier underscores undue resistance to meaningful repercussions within Trudeau’s government. Allowing them to initially defend themselves and resign voluntarily smacks of privileged treatment not afforded most Canadians facing such serious ethical lapses.

The Trudeau Liberals touting transparency rings hollow when systemic breaches went undetected on their watch until whistleblowers forced action. The coordinated leadership exodus reeks of evading real accountability once malpractice was exposed publicly. Canadians deserve to know if Trudeau’s government is more focused on saving political face than instituting reforms when funds are misused and rules broken.

A key question remains — why are Verschuren and Lawrence resigning if they did nothing wrong as claimed? The timing smells of leaders abandoning ship to escape consequences once evidence mounted against them. If the investigation was so flawed as they asserted, why not vociferously fight the findings to the end? Their sudden reversals and rushed exits suggest genuine misconduct they can no longer smooth over. Leadership roles require both competence and integrity – these officials displayed neither.

The Trudeau government’s lack of transparency and oversight enabled an environment where ethical boundaries could be repeatedly crossed at SDTC. Canadians have a right to expect better from public agencies and leaders entrusted with precious resources and responsibilities.

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