Recycle BC is rapidly evolving its governance structures, and we look forward to sharing our progress to date, and plans for the future, with you. We also wanted to apprise you of the steps we have taken, and those in progress, to re-assess the protections in place with respect to potential conflicts of interest and the confidentiality of steward data in light of the pending sale of our administrative service provider, Canadian Stewardship Services Alliance (CSSA), to GFL Environmental Inc. (GFL). We will be corresponding with you over the coming months as to further steps that are planned to evolve governance at Recycle BC.
Governance
Recycle BC (MMBC Recycling Inc.) was incorporated in 2011. The organization’s goal was to submit a stewardship plan on behalf of stewards as required by the new recycling regulation for packaging and printed paper. Once the stewardship plan was approved by the BC government in 2013, CSSA provided a loan for program start up. Working across the stakeholder community and with the backing of industry leaders, CSSA assumed a leadership role by implementing the stewardship plan in BC that met the requirements set out therein.
Consistent with this history, CSSA was the sole member of Recycle BC until recently. CSSA, as sole member, took certain actions to recruit new Board members. It retained Watson Governance to carry out a consultation with key stakeholders to gain insights into their expectations regarding Recycle BC’s governance.
More recently, CSSA determined to sell all of its assets to GFL, thereby signalling its intent to cease its mandate as an operator of stewardship programs. As such, John Coyne, the sole director of CSSA and a director of Recycle BC, resigned, and decisions were taken to replace CSSA as a member with the then current directors of Recycle BC: Paul Hazra, Bob Chant and Debbie Baxter.
On August 19, 2021, these new members of Recycle BC voted to elect Robyn Collver, Ian Gordon and Angela Griffiths as directors. A summary of their qualifications follows:
- Robyn Collver is Senior Vice-President, Regulatory Affairs and Chief Sustainability Officer at Canadian Tire Corporation, Limited. She has a legal and risk management background, in addition to general executive experience, including as former Chief of Staff/Senior Adviser to the CEO of Canadian Tire. A former Chair of Stewardship Ontario and co-creator of the Canada Plastics Pact, Robyn has been active in the steward community since 2016. Robyn has been appointed Chair of the Governance Committee.
- Ian Gordon is Senior Vice President of Plastic Waste Reduction at Loblaw Companies Ltd. Ian has dedicated his career to consumer-packaged goods, spending the last 14 years with Loblaw Companies with a focus on marketing, product development and executive leadership. He has recently taken on responsibility for Loblaw’s commitment to contribute to a sustainable circular economy. Ian is on the Board of the Canada Plastics Pact.
- Angela Griffiths has a doctorate in resource management and environmental studies and oversees the sustainability and circular economy initiatives at A&W. Throughout her career, Angela has worked with Fortune 100 companies in food services, retail, and electronics sectors, among many others.
Subsequently, on September 22, 2021, recognizing the need for additional finance expertise on the Board and to increase financial expertise on the Audit Committee, the directors of Recycle BC welcomed Greg Moore to the Board. Greg is the President & Chief Executive Officer of iCona Holdings Ltd and resides in Port Coquitlam, BC where he was the former multi-term Mayor of Port Coquitlam and Board Chair of Metro Vancouver. He most recently served as Interim CEO of BC Lotteries Corporation and, upon leaving that role has become the Board Chair. Greg has been appointed Chair of the Finance & Audit Committee.
Operations
Following announcement of the CSSA/GFL transaction, the Board requested that Recycle BC staff review the contractual and operational arrangements in place to understand risks to Recycle BC that may arise from the transaction. The following significant risks were identified, and actions taken accordingly:
1. Segregation of duties — Recycle BC’s auditors, BDO, have been retained to ensure that key validation processes which would continue to be provided by RRA after the deal closes are not compromised by the integrated nature of the CSSA/GFL transaction. BDO will recommend changes to processes if and where necessary.
2. Confidentiality of data — Similarly, BDO will examine the systems, processes, and procedures currently in place to protect the confidentiality, integrity and accessibility of Recycle BC’s steward data and restrict its availability to unauthorized parties, most especially GFL. BDO will make recommendations as to any enhancements necessary to preserve confidentiality. BDO will be reporting to the Recycle BC board on its findings at its Q4 meeting in December. In the interests of efficiency, the audit of confidentiality of steward data will also be extended to include Multi-Material Stewardship Western (MMSW).
It is worth noting as a matter of reassurance to stakeholders that Stewardship Ontario has already completed its BDO audit with respect to data confidentiality and key protocols and has concluded that: CSSA is currently abiding by all processes and controls required by SO, as outlined in its current service agreement, the Blue Box Transition Plan, and the additional interim measures imposed by SO, including CSSA’s organizational structure, identity and access management protocols, code of conduct, and data security processes.
3. Contractual risk — Under the management services agreement between CSSA and Recycle BC, CSSA has the right, on its face, to assign the agreement to GFL without Recycle BC’s consent. While there could be avenues to contest this position, the Board has to date determined that it is in the best interest of Recycle BC to focus first and foremost on the prior two areas given the inherent risks and costs of litigation, including staff time, and the potential disruption to operations.
Conclusion
The Board will continue to assess all risks and options moving forward and adjust courses of action in accordance with its best collective judgment which includes establishing criteria to evaluate the CSSA management services agreement to ensure that it is serving the best interests of stewards. Recycle BC will follow our well-defined processes when agreements are up for renewal.
Prior to the transaction, we had two vendors that served the organization very well – we have a fiduciary obligation to ensure that the operations of the organization continue while managing any changes to risk and cost. We also want to ensure that we continue to deliver the excellent service that the Province of British Columbia has come to expect from Recycle BC as a leading recycling program, to optimize our environmental outcomes and to manage steward contributions in the most effective and efficient way. We will provide a further update on these and other governance matters in mid-January.