Appearance of conflict of interest as detrimental to public trust as breaches: experts

Ethics experts told MPs that public office holders must be as careful to avoid the impression of conflict of interest as they are to avoiding actual breaches of ethics law.

Members of the House of Commons ethics committee heard that testimony presented to them on Monday, when they met to discuss the measures in place to protect against conflict of interest impacting federal spending. The committee’s study is one of several by a parliamentary committee that’s part of the fallout of the WE affair.

Robert Czerny, the former president of the Ethics Practitioners’ Association of Canada, was part of a panel of ethics experts, telling MPs that even the appearance of a conflict of interest is capable of eroding public confidence in government.

“Avoiding the appearance of a conflict interest is no less important than avoiding its actual occurrence,” Czerny told MPs.

Chris MacDonald, an associate professor at the Ted Rogers School of Management, also said that where a conflict of interest is not dealt with properly, it can hurt the public’s trust in an institution. 

“This is, in fact, the moral press of conflict of interest,” he said. “Trust is imperilled if people even suspect that experts or office holders, who are inherently difficult to monitor, might be in a position to improperly profit from their privileged status.” 

READ MORE: Ethics committee passes motion calling on Trudeau to testify, review payments for family’s speaking fees

The hearing was held nearly two months into ongoing investigations into the process that led the federal government to outsource the $500 million Canada Student Service Grant (CSSG) to WE Charity, despite the families of Prime Minister and Finance Minister Bill Morneau being closely linked to the organization.

It was just weeks after Trudeau announced WE would administer the CSSG when Canadaland reported that the prime minister’s mother and brother had been paid over $350,000 for dozens of speaking events between 2016 and 2020. Ties between the prime minister’s wife, Sophie Grégoire Trudeau, and WE – which she hosts a podcast for and is a brand ambassador of – have also generated scrutiny.

The relationship between Morneau, his family and WE has also been subject to criticism. One of Morneau’s daughters works for WE, while another previously spoke at a WE Day event and had a book of her’s endorsed by Marc Kielburger, one of the founders of WE. Morneau also revealed when he attended a meeting of the finance committee last month that he had paid WE back the same morning for more than $41,000 in unpaid expenses for two trips he and his family took with the organization in 2017.

Neither Trudeau or Morneau recused themselves from cabinet’s decision to approve a recommendation from the public service to award WE the right to facilitate the CSSG. Trudeau told the finance committee at a rare appearance close to two weeks ago that he had “pushed back” against the recommendation that WE Charity operate the program.

“I wanted to be satisfied that the proposal that WE Charity deliver the CSSG had been properly scrutinized,” Trudeau said.

READ MORE: Trudeau won’t say if he knew mother, brother had been paid by WE for speeches

As defined in Section 4 of the Canadian Conflict of Interest of Act, a conflict of interest occurs when a public office holder “exercises an official power, duty or function that provides an opportunity to further his or her private interests or those of his or her relatives or friends or to improperly further another person’s private interests.”

At Monday’s hearing, MacDonald said the definition is flawed, and urged that leading experts agree the definition should not be based on an improper action, but rather on a kind of situation where a person has a private or personal interest that could impact their duties as an office holder. 

“According to this expert consensus, this conflict of interest exists as soon as this official finds herself in a certain kind of situation, namely one in which she has the opportunity to act in a way that puts biases into action,” MacDonald said. “Such an official is already blamelessly in a conflict of interest.” 

He suggested that public office holders should avoid conflicts whenever they can, but that they should also disclose them and remove themselves from such situations whenever is possible.

READ MORE: WE Charity’s financial problems were well-known: assessors

Czerny also offered some recommendations to avoid the issue of conflict of interest being overlooked, saying that all federal cabinet meetings should begin with the chair raising the issue of conflict of interest and inviting members to recuse themselves where necessary. He also suggested that a deputy minister’s personal briefing could include a reminder for the minister to consider potential conflict of interests for agenda issues. 

“This should be seen as part of the deputy’s support to a minister,” Czerny said.

The ethics committee’s investigation into conflict of interest continues on Wednesday, with Employment Minister Carla Qualtrough, Youth Minister Bardish Chagger and Privy Council clerk Ian Shugart expected to provide testimony to MPs. Mary Dawson, the former federal ethics commissioner, is also scheduled to address MPs. The committee had expected to host her on Monday before a last minute rearrangement.

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