Corporate Governance

By Hilbert Haar

It sounded good when the government established the Corporate Governance Council back in February 2010, but history shows that it was predominantly a paper tiger.

“The council will advise the government on important matters, like the appointment of managing directors to government-owned companies and government controlled foundations.”

That quote is from William Marlin, at the time the leader of the island territory of St. Maarten’s government.

The first members of the council were  Louis Duzanson, Minerva Vlaun-Monte, Francis Carty, Maria van der Sluis-Plantz and Agnes Gumbs.

“You are the first to be appointed to the council and what it will become depends mainly on you,” Marlin said back then.

But it soon turned out that the corporate governance council was a thorn in the government’s hide; that was of course exactly what the doctor had ordered, but politicians had different ideas. They frustrated the work of the council by withholding resources and, as we know now from the Prosecutor’s Office request for a civil inquiry at the port, mostly ignored corporate governance procedures.

A cartoon comes to mind where a guy says to another guy: “If you did what our government is doing, you would end up in prison.”

We know now that former Minister Romeo Pantophlet overstepped his authority in 2012 when he ordered members of  the supervisory board of the harbor group of companies to resign. He also instructed them not to take decisions about certain matters.

The minister had no right to do this – but he did – and the board members were under no obligation to adhere to his orders – but they did.

Politicians putting pressure on anybody who gets in their way is nothing new; it happens all the time, and not exclusively in St. Maarten.

The question is of course why the minister ignored all the rules. (I would think: because he could). Another question is why the board members bent to his will.

I could think of a couple of reasons, but I’d rather leave that for now, because there is a third, and more important question to look at.

While Pantophlet was breaking all the rules in the book of corporate governance, politicians went about their business the way they know best: they ignored the situation.

Oh, there were outcries in Parliament, but words are cheap. Nobody took the initiative for decisive action to put a stop to a minister who went out of control.

We know by now that millions of dollars were stolen from the harbor. In whose pockets that money landed, we don’t know yet, but the civil inquiry will certainly shed some light on that issue.

And there we arrive at the crux of the matter: money. Politicians have always been quick, especially when they were in the opposition, to say that the harbor companies were used by their political opponents as an automatic teller machine – money for nothing and the chicks for free, so to speak.

Every local politician knows that he – or at least his party – will not always be in the opposition. Sooner or later they will get their turn to grab what they can in terms of power, all-inclusive trips to exotic destinations and cold hard cash.

No wonder political parties like the USp always have their eye on the ministry that will act as the harbor’s shareholder representative.

Sutton’s law states that when diagnosing, one should first consider the obvious. It suggests that one should first conduct those tests which could confirm (or rule out) the most likely diagnosis. It is taught in medical schools to suggest to medical students that they might best order tests in that sequence which is most likely to result in a quick diagnosis, hence treatment, while minimizing unnecessary costs.

Okay, I did not write the above paragraph; I picked it up from Wikipedia. Sutton’s law is named after the American bank robber Willie Sutton. He reportedly once told a reporter who asked him why he was robbing banks: “Because that’s where the money is.”

Sutton’s law equally applies to political parties that hunger for a minister who can exercise control over the harbor group of companies.

Do we need more reasons for a civil inquiry at the harbor?