With an eye to top policy issues, major telcos appoint former cabinet ministers to boards

The appointment of former senior Conservative cabinet ministers to the boards of leading Canadian telcos is turning attention to the companies’ potential influence with the Harper government. Telus Corp. announced Friday that it has appointed former Treasury Board president Stockwell Day to its board of directors. Two weeks earlier, major telco and media company BCE Inc. named former Tory industry and environment minister Jim Prentice to its board. In a blog post Saturday, advocacy group OpenMedia.ca wrote that the companies are “cozying up” to the Harper government to counter growing grassroots engagement on digital policy issues. “In short, the tide has turned against Big Telecom, and now they're cheating to hold onto their stranglehold on the telecom market,” communications manager Lindsey Pinto wrote on the group's website. Dwayne Winseck, a communications industry expert and professor at Carleton University’s school of journalism and communication, wrote on his blog Monday that the appointments were “business as usual” and more evidence of a “systemic and a big problem that contradicts the ideals of a free press and any notion that TMI policy in this country is anything more than industrial policy ...” Winseck included a chart tracing political connections between telecom and media companies and politicians. He noted that former B.C. finance minister Carole Taylor and former federal Liberal cabinet minister Ed Lumley serve on the Bell board that Prentice recently joined; former Ontario Progressive Conservative leader John Tory and former Ontario Liberal premier David Peterson are on Rogers Communications Inc.’s board of directors; and former Progressive Conservative prime minister Brian Mulroney is a member of Quebecor Media Inc.’s board. Former Conservative New Brunswick premier Bernard Lord is also the president and CEO of the Canadian Wireless Telecommunications Association (CWTA). Telus spokesman Shawn Hall said the company selected Day for his experience across the country and his financial literacy. “Mr. Day is prohibited from acting as a lobbyist for Telus or any other organization under federal legislation, but he does bring a unique perspective to the board based on his experience in government working in both B.C. and Alberta,” Hall said in an interview. “It’s not uncommon for people who’ve served in politics to join corporate boards. They bring unique skills—an understanding of finance and customer bases. The skills and experience we demand of our government leaders are similar to what corporate boards are looking for.” Tim Powers, a Conservative lobbyist and vice-president of communications at government relations firm Summa Strategies, agreed that it’s not unusual for former senior cabinet ministers to work for corporations because their skills are sought after. He said bringing in people like Day and Prentice—who have sat at the federal cabinet table with Prime Minister Stephen Harper and understand how the current government thinks and works—is invaluable. “One of the things telcos … are always needing to improve upon is doing politics better and understanding how they use politics to ensure that the policy they’re seeking is consumer and main street-friendly,” he said. “I think the ethos of this government still is based on consumer and main street attitudes, and having both Prentice and Day at the disposal … of those respective companies will allow them to have some understanding of all of that, and that’s vital.” John Lawford, counsel with the Public Interest Advocacy Centre (PIAC), said the “revolving door” between telecom and government is nothing new. “Political cronyism is alive and well in Canada,” he said in an interview. “That’s the way it goes. There’s no reason why people can’t sit on boards. There’s nothing illegal about it.” Lawford said the appointments result in part from Bell and Telus’ surprise at the government’s decision surrounding the rules for the last spectrum auction in 2008, when advanced wireless spectrum was set aside for new entrants. “I don’t think they really made the bridges to the Conservatives that they thought they had made. They got a bit surprised by that one, so they’re going to make sure it doesn’t happen again. One of the ways to do it is to have corporate board members who are … former members of the governing party,” Lawford said. Former CBC technology reporter Peter Nowak said he also thinks spectrum policy provided an incentive for the appointments. Nowak wrote on his blog Monday that Bell and Telus “are arming up” for the 700 MHz auction, which will be held next year or early in 2013 and for which the government hasn’t yet set a policy framework. “Given how badly they were spanked in the last one, where it was ironically Prentice who set the rules that gave newcomers big advantages and thereby leading to the launches of Wind , Mobilicity, Videotron and Public Mobile, they probably don’t want a repeat. Getting government types on board, they hope, will net them better terms for the upcoming auction,” Nowak wrote. The Conservative government has made some efforts at limiting the so-called “revolving door” between industry lobbying and government. The Tories created the Lobbying Act in 2008, which bans former senior government officials from registering to lobby government for a five-year “cooling off period”; implements new disclosure requirements for lobbyists; and brings in stiffer penalties for violating the rules. Nowak noted that the new wireless entrants have also been busy lobbying the government, and that, according to lobbying records for 2009, only Bell met with government officials more frequently than Wind. Hall couldn’t identify any particular regulatory issues for which Day would be especially valuable, saying it was the former minister’s understanding of finance and customer bases that Telus values. Lawford said the issue of foreign ownership—where the telecom industry is awaiting a government decision—is another key policy on which the companies are seeking insider insight. He said Prentice could present Bell with realistic options of what the government will do and wield some political influence. “He also knows the file, so he’s not going to just go and glad-hand. He’s also going to be able to explain stuff to people, which I think matters,” Lawford said. mburgess@thewirereport.ca

With an eye to top policy issues, major telcos appoint former cabinet ministers to boards

News | August 9, 2011

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