Hey, Stefan… what were you thinking?
Earlier this week I talked about my bemusement at the inaction of the Callaghan Innovation Board, in choosing to sit on the sidelines and watch livelihoods and reputations destroyed, as a direct result of their actions, and inactions.
Today I’m moving on to the next episode in this distasteful saga. Yesterday I covered the CEO who presided over the original procurement process, including the use of a contract investigator to conduct due diligence on the RFP respondents.
So many questions about that process – but let’s move on.
In the face of claims of a conflicted contractor, Callaghan Innovation (now with a new acting CEO in place), commissions EY to perform an independent review of their due diligence process. Sounds like a good plan, I hear you thinking. This report from EY will subsequently become the shield behind which procurement, management and the board shelter.
But consider this.
Based on a release of the EY report under the OIA, it seems that the scope of the review was limited to a simple evaluation of the mechanics of the contractor’s process of investigation. Specifically, the scope did NOT include questions as to….
- Whether the process to select the investigator met the standards of government procurement;
- Whether the investigator was conflicted in accepting the contract to conduct the DD;
- Whether Callaghan itself has appropriate internal systems to manage conflicts of interest;
- Nor any of the actual claims made in the reports.
The EY report states several times that Manaaki should have had the opportunity to comment on the reports when they were in draft stage. As I understand it, Manaaki has only seen redacted copies of the final reports, and still has not seen the full reports.
There were several “referees” added to the investigator’s interview list without Manaaki’s knowledge, including one whom EY says had no business history with Manaaki at all. The EY report says that this is not right.
To put this in simple terms – Callaghan set the EY brief to exclude all the contentious issues. EY, as per Callaghan’s instructions, focused on process mechanics only. Based on the scope of their brief, I suspect EY’s conclusions were valid. And Callaghan got the report they sought. The real question is this an acceptable way to do business?
The EY report also identified other issues with the process. If you’re interested, the report is available.
It’s ironic that in the preface to their report, EY states explicitly that:
“EY has not been engaged to act, and has not acted, as advisor to any other party.”
Did the investigator, Borland, make the same statement in his reports? Could he have honestly done so?
And where is the new (at that time acting) CEO in all of this?
Does he really think that commissioning an independent review, that puts the key issues of contention out of scope and then states all is well in the process, is okay?
Now as Callaghan’s CEO (no longer acting) does he consider that maybe, just maybe, it would be worthwhile to sit down with Manaaki and reach some sort of agreement that allows both parties to move on, and continue doing their chosen business, albeit not together?
And when the matter became increasingly public, being played out initially in social media, and then in the national press, did he consider the potential damage this could cause?
Does he think it’s okay that Manaaki is being essentially blackballed by his predecessor’s actions, when she started the leaking (oh, sorry, “sharing”) of the reports by sending them to other government departments. This surely provided justification for the subsequent flood – a deluge of the reports being shared far and wide to media and influencers? Reports to which Manaaki has had no real right of reply.
Does he genuinely think it’s a great outcome that Manaaki is driven out of business, as a result of a small number of business disputes, now resolved, despite the good that they’ve done? And the thousands of small of businesses supported by Manaaki.
And has the Callaghan Innovation Board considered the longer term impacts of this debacle?
More on that in my next post, but for now, think about this.
How comfortable will you be submitting a proposal in the next government-run procurement process, knowing what can happen when things go wrong?
This is NOT about who wins and who loses out in a tender process.
It’s about Callaghan Innovation’s process and decisions that have provided ammunition to those trying to destroy Manaaki and its founders; ammunition to continue to wage this destructive war. How can the Callaghan Innovation Board stand by, putting their own organisation’s reputation at risk, and allow this to happen?
The real unanswered question is who gains from the destruction of Manaaki? And did they use their networks and connections to influence the due diligence reports to their advantage? But that we will probably never know.
It’s time to commission a truly independent report, that covers the full scope of issues identified.
Or just withdraw the reports, and hey, perhaps even issue an apology.
What were, and are, these people thinking? Or, one has to ask, are they thinking at all?
And what role does MBIE and the Minister have in all of this?