Remarks by: Eric Siegel
President and Chief Executive Officer
Ottawa - May 5, 2010 

Thank you Jim for those kind words. It has been a remarkable 31 years at EDC.  Ironically, no one of these years has been more remarkable than 2009 – for me as the CEO of EDC, for our customers, for the Canadian and global economies, and for the nature of global trade.

For Canadian companies, 2009 was a troubling year. The credit crunch wrought havoc on the global economy. And the impact was particularly harsh on Canadian exporters who saw export sales plummet 24 per cent, the most severe drop since 1946.

In this difficult environment, Canadian exporters and investors called upon us to do more to help them. And that’s exactly what we did – through greater collaboration with the foreign customers of Canadian exporters, and with our shareholder, the Government of Canada.

The recession and credit crunch constrained the capacity of financial institutions to support Canadian companies. In turn, this triggered a surge in demand for our financial assistance from companies in all sectors and of all sizes. We served a record 8,469 customers in 2009, including well over 2,000 that were new to EDC or had not used our services in some time. Developing relationships with these new customers is a priority for 2010.

Earlier, you heard the Chair talk about being a trusted partner.  This is important to us at EDC, and it shapes the way we approach our customer service. Our mission is to help our customers take advantage of trade and investment opportunities, be responsive to their needs, and provide consistently reliable service. 

In 2009, being a trusted partner was more important than ever. It meant being there when our customers needed us the most. When the credit markets tightened up, we were intimately aware of the complex challenges facing some of our customers, and we responded with solutions that helped them to prevail. Comme l’a fait remarquer le président du conseil, cette capacité d’agir ainsi a fait d’EDC l’une des institutions financières les plus dignes de confiance au Canada.

The Government of Canada also showed its trust in EDC by turning to us to put more credit into Canada’s financial system to help Canadian companies during the downturn. With our two-year expanded domestic mandate, we were able to do more for viable but struggling trade-related companies here at home. Particularly in some of the hardest hit sectors.

Thanks to our strong partnerships, we were able to increase the availability of credit to Canadian businesses during the credit crunch, and to do so quickly. Working closely with Canadian banks, credit insurers and sureties, we added $2.5 billion in credit to the Canadian domestic market when it was needed most. This directly aided 208 companies with their business in Canada during 2009. EDC continuera de combler des vides du crédit à l’appui des opérations au Canada pendant toute la durée de notre mandat sur le marché intérieur.

Meeting the high demand of 2009 was made easier by the fact that we are more efficient, and have focused more of our talent, knowledge and energy where it belongs – on our customers.

We have improved our turnaround times on loan transactions in recent years through our new lean process methodology. The difference has been felt by our customers, who gave us strong endorsements as measured through our Net Promoter Score, which assesses the likelihood of our customers recommending EDC to other businesses.

Last year we began implementing similar initiatives in our Bonding program, acting on feedback from our customers and bank partners. We were told that while the program was of high value to their business, the process was complex and unpredictable.

When we deconstructed the process from beginning to end, from the customer’s perspective, what immediately became clear was that there were ways we could improve productivity and service.

In less than a year, we’ve done just that. By streamlining our procedures, eliminating unnecessary back and forth with customers, and decreasing the number of internal processes, we’ve cut end-to-end cycle time by more than half. And we’ve provided customers with an improved product that helps them better plan their business.

How do we know we’ve succeeded? As I said earlier, we measure our success through our Net Promoter Score – that is, we ask customers how likely they are to recommend us to a colleague who is also an exporter. I am very proud of the fact that, despite the pressures faced by EDC and our customers in 2009, we increased our score from last year and our result is on par with the most respected corporations in North America.

Our employees are at the centre of everything we do. Both across Canada and around the world. In 2009, we worked harder than ever to ensure they continue to be engaged, committed to better customer service, and to being a trusted partner within the marketplace.

To make certain we had the means to support our customers’ increased demands during the downturn, we implemented an extraordinary resourcing initiative. This meant hiring 50 new people and redeploying many existing employees to high-demand areas.

We also continued to grow the diversity of our workforce. This is in keeping with the nature of EDC’s business and our appreciation of the variety of backgrounds and cultures that combine to make EDC – and Canada – so special. Our progress in creating a work environment that promotes and celebrates diversity has earned us recognition as a best employer for new Canadians.

EDC’s mandate and business model also received strong endorsement from the Government of Canada in 2009.  The Government’s review of the Export Development Act concluded that EDC plays a critical role in facilitating Canada’s capacity to compete and succeed internationally. I personally look forward to changes to the Act that will continue to advance our role.

As well, the Auditor General noted our effectiveness, sound management and governance in her report on a special examination of EDC that concluded in 2009.

At EDC, we believe that how we achieve positive results is as important as the results themselves. That’s why we are committed to facilitating Canada’s international trade in a socially responsible manner, and supporting our customers and partners in doing likewise.

EDC has a comprehensive Corporate Social Responsibility (CSR) program that includes environmental and political risk assessments – including human rights – for every transaction that we consider. I should mention that EDC is the only export credit agency in the world where environmental review of transactions is a legal requirement.

We believe our CSR policies bring a competitive advantage to the Canadian companies we deal with. Their transactions are seen as having met some of the highest standards applied by any export credit agency.

Because CSR issues tend to converge around environmental concerns, 2009 saw us begin a review of our Environmental Policy. This policy outlines the environmental review processes that we apply to transactions, helping to ensure we fulfill our commitments related to environmental sustainability.

Our review included an extensive stakeholder engagement process on issues such as project benchmarking standards, project conditions and monitoring, disclosure practices, climate change and EDC’s environmental footprint. After a thorough consideration of the feedback we received, EDC will be issuing a revised policy in 2010.

Last year, we also began developing a climate change strategy that includes a methodology to measure the green house gas emissions of our lending portfolio, and reducing our travel emissions.

As well, EDC worked to raise customer awareness of the risks of bribery in international business transactions by developing an online tool highlighting the risks and measures to detect and deter bribery. This tool is publicly available on our website.

We also continue to participate in forums that are working towards defining best practices on how businesses can address issues arising from the intersection of business and human rights.

Part of our strong performance in a challenging year was due to our ability to respond to customers quickly and efficiently. To do that, EDC continues to get closer to the exporting community and its strategic partners clustered in exporting regions across Canada. To this end, we opened new offices in Ville St. Laurent and Drummondville, bringing us to 17 offices across Canada.

EDC also increased its capacity to serve our customers where they conduct their business abroad, growing our international network with a new permanent representative in Lima, Peru to serve exporters to the Andean region.

This brings our number of international representations to 14. We will further expand this network in 2010 to make sure we are doing all we can to connect Canadian companies to the wealth of opportunities in emerging markets around the globe.

The increased demand for EDC’s assistance in 2009 contributed to us meeting or exceeding our targets for several of our business results last year.

We achieved a net income of $258 million. Together with our capital base, this gives us the capacity to continue increasing our support to Canadian exporters and investors, and to Canada as a trading nation. And our sound financial management ensures that we have the means to fulfill our mandate now and in the future.

I’ve shared with you some of the notable results and major initiatives of EDC’s operations in 2009, but I will also take a few moments to talk about what we’re seeing so far in 2010.

Everything points toward a “new normal” for the global economy. While the economy is turning around, the recovery is still shaky. Governments and institutions worldwide are expected to remain conservative, emerging economies will take centre stage, and all signs say public-private sector financial partnerships are here to stay.

As such, public sector financing, bonding guarantees and other international credit solutions will be in greater demand than ever in capital markets around the world as we emerge from this recession. 

This is the “new normal” and companies who fully understand the financing and other credit options available to them will have a competitive advantage in the new global economy. EDC has a valuable role to play in all these areas. As demand for our services and expertise continues to increase, we will be there for our customers – a trusted partner where and when they need us the most.