Opinion: Bal masqué at the Harbor?

POSTED: 09/3/12 11:01 PM

The Minister of Tourism and Economic Affairs, Mr. R. Panthophlet, confirmed last Wednesday that the members of the supervisory board of the Harbor were asked to give up their positions. At first sight, this news might not be shocking for the average newspaper reader. However, if one takes a closer look at this request, it seems that some essential values of good corporate governance are being infringed.
The Harbor is a government owned company. Just like certain privately owned companies, it has a supervisory board. Its main task is to independently supervise the policy of the board and the general course of affairs in the company.
Moreover, since the Harbor is a government owned company, a specific law applies: the Corporate Governance Code. This Code and its Corporate Governance Council might be considered as shackles by some of our politicians, but it is in fact a very important tool – essential even – to guarantee that the supervisory board members are competent, unprejudiced and independent; independent from each other, from the managing director, and “from whichever other partial interest that might be involved”. To comply with this Code is an absolute must for any self-respecting democratic country.
The goal of this Code is obvious. It prevents that politicians use government owned companies as their political toys. It prevents – or at least tries to prevent – that whenever a new government is appointed the supervisory boards of all government owned companies get new members of the same political color as the new government. This has happened before and, according to the information in the local newspapers, it seems that it is happening again. I will give two reasons (for now) why the request of Minister Pantophlet seems to be in violation of the Corporate Governance Code.
First of all, the Code stipulates that the Corporate Governance Council advises the general meeting of shareholders (i.e. the government) regarding the drawing up of a profile of the supervisory board and its members. This written profile is a public document according to the Code. It should thus be easy to review this document. According to the local newspapers, however, the advice of the Corporate Governance Council was not obtained by government and consequently such a document does not exist. If this is in fact the case, then this is the first infringement of Good Corporate Governance.
The second (possible) infringement is the following: The supervisory board of the Harbor consists of five persons. According to the local newspapers they were all appointed earlier this year for a period of four years. That means that (most) supervisory board members still have a long time to go in their term. One would expect that some serious development would have taken place as a reason for the minister’s request to step down. The Code describes four circumstances under which supervisory board members may be “prematurely retired”. 1: in case of inadequate functioning of a supervisory board member; 2: in case of a structural difference of opinion; 3: in case of incompatibility of interest and 4: in case his/her integrity is an issue.
According to the local newspapers, however, the reason for the Minister to ask the supervisory board members to step down is a rejuvenation of the supervisory board. Now it is getting really interesting. Not only is rejuvenation not a ground for premature retirement under the Code, it is also remarkable that a couple of months ago when the current supervisory board members were appointed, they apparently were not too old. And now, all of a sudden, this board would be in need of young people? Did time pass so much faster for the supervisory board members than for the rest of us?
In short: this whole request to step down is odd. It just does not add up. Although…
As we all know, the Sint Maarten government fell a few months ago. Without any election being held, our politicians formed a new government. UP is out, NA is in. Minister Pantophlet is a member of the NA. And he is also the minister that requested the current supervisory board to step down. Will the candidates for the new supervisory board be somehow linked to the minister or the NA, and is the rejuvenation-argument just a masquerade? These seem to be rhetorical questions only.

Camiel Koster.
The author is an attorney at the law office of Bergman Zwanikken Snow Essed.

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