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Backgrounder - Founded wrongdoing by the Chief Executive Officer of the Enterprise Cape Breton Corporation

Disclosure

In January 2013, the Office of the Public Sector Integrity Commissioner of Canada received a protected disclosure of wrongdoing against Mr. John Lynn, Chief Executive Officer of Enterprise Cape Breton Corporation (ECBC).

ECBC is a federal Crown corporation that was created to promote and assist the financing and development of Cape Breton Island and the Mulgrave area in Nova Scotia. The organization reports to Parliament through the Minister responsible for the Atlantic Canada Opportunities Agency (ACOA).

The allegations claimed Mr. Lynn had improperly appointed four individuals to ECBC executive positions in 2009/2010. It was alleged that these appointments were made under political influence and not based on merit or following a competitive process, and were further depicted as “patronage appointments”. It was also alleged that under political influence, Mr. Lynn improperly contracted the consulting services of another individual at ECBC. Finally, it was claimed that Mr. Lynn did not manage the ECBC-funded Ben Eoin marina project in accordance with its intended purpose; specifically, that he reserved most of the marina’s berths for his own usage as well as that of his associates, which was considered to be incompatible with ECBC’s obligations under section 33 of the Enterprise Cape Breton Corporation Act to broaden the base of the region’s economy.

The Office launched an investigation into the matter in June 2013.

 

Findings

The investigation found that:

  • Mr. Lynn committed a serious breach of ECBC’s Employment Conduct and Discipline Policy, which was ECBC’s own code of conduct at the time. This finding is as a result of the appointment of four individuals with ties to the Conservative Party of Canada or the Progressive Conservative Party of Nova Scotia into executive positions at ECBC with little or no documented justifications and without demonstrating that the appointments were merit-based. These appointments give the appearance that they were partisan appointments.
  • Although Mr. Lynn’s appointment decisions were inconsistent with good governance standards, it was determined that the circumstances did not amount to a gross mismanagement because the investigation did not demonstrate that his decisions affected ECBC’s ability to carry out its mandate.

The information gathered during this investigation did not substantiate the following allegations:

  • That Mr. Lynn committed a wrongdoing with respect to the contracting of the consulting services of another individual at ECBC and
  • That he committed a wrongdoing with respect to the management of the Ben Eoin marina project.

 

Recommendations

In response to the ongoing investigation by the Office, ECBC’s Board of Directors approved a new Recruitment and Selection Process Policy. Since the main institutional shortcomings identified in this case were ECBC’s ambiguous recruitment and selection guidelines, and given that there is now a new Recruitment and Selection Process Policy in place, the Commissioner did not recommend that a new staffing Policy be developed and implemented.

The full Case Report can be viewed online at www.psic-ispc.gc.ca.

 

For more information, contact:

Edith Lachapelle
Manager, Communications
Office of the Public Sector Integrity Commissioner of Canada
Telephone: 613-946-2138
Email: Lachapelle.Edith@psic-ispc.gc.ca

 

2016-05-24