Independent review finds no evidence of wrongdoing for EDC
In March 2019, Export Development Canada (EDC) initiated a third-party review relating to a political risk insurance policy it provided to a commercial bank in 2011 in support of SNC-Lavalin’s business activities relating to the Matala Dam in Angola. Today, EDC is announcing the result of the third-party review, which has found no evidence of wrongdoing on the part of EDC personnel.
EDC commissioned the external review immediately upon hearing about the new and serious allegation from an unnamed source to the Canadian Broadcasting Corporation (CBC). The allegation was that EDC turned a blind eye to improper or illegal payments alleged to have been made by SNC-Lavalin to an agent retained by it for the purpose of securing work on the Matala Dam.
Over the course of three months, Fasken, a Canadian-based international law firm, undertook an extensive and independent investigation of the matter. As part of its investigation, the firm reviewed more than 1.7 million EDC records pertaining to SNC-Lavalin and the project, and conducted interviews with staff. Fasken did not find any evidence that EDC personnel had knowledge of, or were willfully blind to, bribery and corruption in relation to the project as had been alleged.
At the same time, as part of its commitment to continuous improvement of its transaction screening process, EDC asked Fasken to review the due diligence applied to this transaction, and this additional review is currently underway. EDC commits to addressing any gaps if they are identified and will further disclose any process improvements made that stem from the review’s findings. For all prospective transactions, EDC undertakes a due diligence process to screen for risk indicators including, but not limited to, corruption, bribery, and business ethics.
“EDC has strict requirements for responsible business conduct and we would never, under any circumstances, knowingly participate in a transaction tainted by bribery or corruption. While we are pleased with Fasken’s conclusion with respect to the specific allegation, we also want to examine how EDC applied its due diligence process for this transaction. If any deficiencies are found, we will address them immediately,” stated Carl Burlock, Executive Vice-President and Chief Business Officer, EDC.
EDC’s due diligence process has always been structured to align with international standards and guidance, such as those under the Organisation for Economic Co-operation and Development (OECD). The process has also evolved over the years, and continues to, as new best practices and guidance have emerged.
“While we are confident in our due diligence process, we also know there is always room for improvement. We believe it’s our job to incorporate lessons learned as we work to support Canadian exporters and uphold our commitments for sustainable and responsible business,” stated Burlock.
Export Development Canada (EDC) is a financial Crown corporation dedicated to helping Canadian companies of all sizes succeed on the world stage. As international risk experts, we equip Canadian companies with the tools they need – the trade knowledge, financing solutions, equity, insurance, and connections – to grow their business with confidence. Underlying all our support is a commitment to sustainable and responsible business.
For more information and to learn how we can help your company, call us at 1-888-434-8508 or visit www.edc.ca.