Corporate governance in the two most prominent public companies defined by the personalities, interests of their top executives

The National Insurance Scheme holds 8% of the issued shares in Demerara Distillers Limited (DDL) while Secure International Finance Company Ltd owns 18.49%, a combined percentage of 26.49% of the company’s issued shares. My first-hand information is that both the NIS and Secure International have been trying for years to have a seat or two on DDL’s Board so that they can have a say in the strategic decisions of the board, exercise some control of the executive management and have access to the operations of the company.

I am advised that on every occasion their request has been rebuffed by one or both Mr Samaroo and Mr Persaud, one of whom, in the eternal tradition of the family property, is the current inheritor of the executive chairmanship of the company from the other. What makes this situation so strange is that, on paper at least, Messrs Persaud and Samaroo own only 0.27% of the shares in DDL. An examination of the shareholdings in DDL suggests that what one sees is not necessarily the effective or beneficial shareholding in the company. Continue reading Corporate governance in the two most prominent public companies defined by the personalities, interests of their top executives

Every man, woman and child in Guyana must become oil-minded (Part 10)

The contract confidentiality debate

The petroleum contracts signed with oil companies has featured prominently in public discussions and letters in the print media during this week. In fact, a letter in the Stabroek News on Wednesday by Mr. Ramon Gaskin calling for disclosure of the oil contracts provoked an immediate response by Minister Raphael Trotman who wrote that the Government has received expert opinions and advice against publication. The difference between the two gentlemen is around the language of section 4 of the Petroleum Exploration and Production Act.

Mr. Gaskin is adamant that the language of the law is clear and accused the Government of peddling inaccurate information to the public. For his part, the Minister describes the Act as “somewhat ambiguous” and that it should be interpreted in a manner that prevents publication. Continue reading Every man, woman and child in Guyana must become oil-minded (Part 10)

Every man, woman and child in Guyana must become oil-minded (Part 9)

The absence of or rather failure to appoint inspectors and a Chief Inspector was highlighted in last week’s column. The seriousness of that failure lies in the fact that the Chief Inspector is the person with direct responsibility for the administration of the sector, to manage the oil companies, so to speak. The last Administration failed to do so for around twenty years and cannot use as an excuse that oil was not a big deal then. After all, thousands of hectares of potentially mineral rich resources offshore were given out to oil companies which by law should be supervised by the Chief Inspector and inspectors appointed by the Minister. The exploration phase is admittedly light on expenditure but it does give operators exclusive right to carry out prospecting activities in the blocks for which they receive a prospecting licence.

It was therefore careless in the extreme that even after the establishment of a natural resources ministry, the PPP/C made no such appointment. Of course, that gave the Minister extensive influence over the oil operators, which was probably the objective. Then came the APNU+AFC Coalition which has also failed to act a full two years after a significant oil discovery with the likelihood of more to come! Continue reading Every man, woman and child in Guyana must become oil-minded (Part 9)

Goverment failed to act on 2016 CoI recommendation to appoint high level committee

Just over one year after the most deadly disturbance at the Georgetown Prisons in March 2016 in which seventeen prisoners lost their lives, came the most fiery event in its more than one hundred year history. The government led by President Granger and Vice-President and Minister of Public Security Khemraj Ramjattan have been busy trying to exonerate themselves and the APNU+AFC government of any responsibility. President Granger, whose presidential campaign was predicated on security and good governance, defends Mr Ramjattan while the latter sought to excuse his failures to take meaningful and effective action to fix the broken justice and prison system partly on the necessity to subsidise GuySuCo.

President Granger’s response to the 2016 deaths was his most predictable: a Commission of Inquiry (CoI). Yet he and his government have failed to carry out the single most important and no cost recommendation – “the creation of a High Level Committee focused solely on reducing the cancer of over-crowding, along with a range of ancillary recommendations to improve the engagement of key agencies and to strengthen the professional capacity of the GPS to respond to its diverse challenges.”

Overly deferential to the President to whom the CoI expressed “unbounded gratitude”, the Executive Summary of its report noted that the authors would be “even more satisfied should our findings be acted upon with deliberate haste” and implored the President “in a year’s time to order a review of their effectiveness”. That the number of inmates in the jail actually increased between the two horrific events is a strong indicator that instead of action we had inaction and instead of effectiveness we witnessed negligence on a national scale. Continue reading Goverment failed to act on 2016 CoI recommendation to appoint high level committee

Every man, woman and child in Guyana must become oil-minded (Part 8)

Introduction

Today we turn our attention to how the country, and more particularly the PPP/C Government and the APNU+AFC Coalition Government have managed the country’s potential and discovered petroleum resource. In 1939, the legislature passed the Petroleum (Production) Act vesting in the Her Majesty the property in any and all petroleum and natural gas within Guyana and made provision for their exploration and exploitation.

Despite later and substantial amendments to the petroleum laws, the ownership of the state in all petroleum has been the essence and foundation of our petroleum legislation now contained in the in the Petroleum (Production) Act and the Petroleum (Exploration and Production) Act Cap. 65:04.

What this means is that any discussion on petroleum matters ought at this point to be discussed against the backdrop of the existing two Acts and Regulations 5 of 1986. Continue reading Every man, woman and child in Guyana must become oil-minded (Part 8)