Mismanagement Seminar

March 29th, 2015

In December, the Canadian Standards Association (CSA) fired their President and CEO, Ash Sahi.  The CSA now reports that Sahi’s three months of transition are ended on March 31, 2015.  This Tuesday he’s finally out the door.

That means they’ve got a new CEO, right?  Well, no actually, CSA has’t hired anyone to replace Sahi.  He’s just leaving with no replacement.  So CSA has an interim CEO?  Again, no, they’ve hired nobody at all to run the place.

Alright, lets ponder.  The Board knew that they were going to fire Sahi before they did that deed, it wasn’t done on a whim.  A competently run Board would have launched an executive search process almost immediately.  Your correspondent has worked in executive recruitment, a proper search takes time.  Knowing this, the Board would have arranged an interim CEO to lead the Agency until a permanent CEO was appointed.  This interim CEO could be Board member, a member of CSA’s existing executive team, or an executive from one of CSA’s member companies.  The search for a permanent CEO takes time but isn’t especially difficult; the position of interim CEO can be filled very quickly.

Managing succession is pretty basic, its standard stuff in business.  Here’s how CSA is managing it:

“While the global search for a successor continues, an Office of the Chief Executive (OCE) will be created to provide interim leadership consisting of the Chief Operating Officer; Chief Financial Officer; EVP Human Resources; EVP Government Relations, General Counsel and Corporate Secretary; and Executive Director & VP Standards.  Mr. Jimmy LaValley, a Director of the Board, will be retained by CSA Group to act as a Facilitator to the OCE.”

Rather than actually appointing an interim CEO, they’re going to appoint a committee to function as though it were a CEO.  Nothing speaks of efficiency or decisiveness quite like leadership by committee in a bloated bureaucracy.  But there are bigger problems.

Among the CEO committee members is the Agency’s CFO.  The problem?  They don’t have a CFO.  Other than that its a brilliant posting.

We take the view that a man named Esteban de Bernardis, the CSA’s Executive Vice President for Finance, is functioning as their CFO.  We have nothing else to base that on, save the similarities in position.  A search of CSA’s leadership list doesn’t show any CFO position, neither does a search of their website.  In fact, the CSA’s only mention of their actually having a CFO is found in the press release quoted above.  Prior to last Thursday they officially didn’t have one.  They still don’t, officially anyway, press releases don’t pass for org charts.

More awkwardly, the CSA’s press release exposes their succession planning as badly remiss.  That’s awkward because they bragged about their prowess in people management, specifically in areas of succession planning.  “We will continue to invest in our people,” they said, “though communications, training, advancement and succession planning.”  And they said that prominently and in their current Annual Report.  And Sahi signed it.

So why is this Agency having so much trouble hiring even an interim CEO?  Well, the problem is us.  No gloating intended, but RestoreCSA is the reason for much of CSA’s current leadership chaos. 

For example, their President of Standards quit her job in mid-2014.  She was being groomed to succeed Sahi, but she walked out with no job to go to.  Executives don’t do this folks, high level vacancies are too rare to jump with nowhere to land.  She quit after learning of her liabilities as a CSA executive.  Now that she’s gone, we can report that she quit after enduring nine hours of direct negotiations with your correspondent.

The Chair of CSA’s Audit Committee quit the Board earlier this year.  He quit after enduring a full year of RestoreCSA’s exposing CSA’s curious expenditures and reporting.  These items are the responsibility of the Chair of the Audit Committee.

The CSA’s Board fired their CEO, Ash Sahi, after nearly two years of our exposing his unqualified qualities.  Literally.  That, and a fascinating display of his negotiating prowess in the Oak Room of Calgary’s Palliser Hotel.  It seems that his volume and his vulgarities were noted by another table.

Most recently, Canada’s infamous double-dipping civil servant, France Pegeot, who we’ve reported on several times, was finally compelled to leave the CSA Board.

Haemorrhaging leadership is not a sign of corporate health.  These executive exits demonstrate that leadership and governance at CSA are well aware of their corporate liabilities and the direct, personal liabilities that flow therefrom.  We’ll not itemize specific liabilities here, but you can read the list on the Issues page

The CSA Board wants to keep the party going, no reforms, or at least nothing more than window dressing.  They want a leader who will sign onto these liabilities, someone who’ll double down on them.  They want a complicit CEO.

In this, the reason why CSA hasn’t appointed an interim CEO is because no sound or sane executive wants to accept this incredible scale of legal liability.  What they’re left with is a “global search” to find someone pliable enough, naive enough, or crooked enough to keep things they way they are, facts and law be damned.  That sort of soul is hard to find.

And it gets harder still with RestoreCSA in the mix.  In recent example, you’ll recall that CSA sent us another threat letter earlier this month.  The CSA was awfully upset about our private inquires with the Government of Saskatchewan, we were asking about medical liabilities stemming from CSA’s questionable testing of medical equipment.  The CSA reacted to the fact that our private letter increased their liabilities, and these require disclosure to CEO candidates at interview, and this happy fact arrived in the middle of their already excruciating recruitment process.  Naturally, we responded to their latest threat by sending private letters to every other Provincial government in Canada. 

The reality is that CSA is an illegitimate amalgam of public regulatory Agency and private corporation.  Restoring the CSA requires severing these conflicted interests.  A clean, capable turn-around expert is what CSA needs and could hire quickly.  What they want however, is harder to find and won’t alter their liabilities, corporate or personal.  Time will tell which way they fall.