“Recommendations are important, but there has to be a second part of it, and that’s holding people accountable,” said Tom Fenske, president of the Laurentian University Staff Association. Inside her reportOntario Auditor General Bonnie Lysyk concluded that Laurentian’s financial collapse was largely due to a poorly planned and costly capital expansion in 2010. He said a lack of oversight by the university’s senior leadership and its board led to a series of poor financial decisions culminating in the decision to apply for creditor protection under the Companies Creditors Act (CCAA). “There is a strong argument that the CCAA, an important tool used in the private sector, is an inappropriate and perhaps harmful remedy for public entities,” Lysyk said during a news conference after the report was released Thursday. “Using federal law allowed Laurentian to circumvent provisions of its collective bargaining agreements, clear up a host of long-standing union grievances, and operate with even less transparency.” Fenske said the staff union plans to sue some of the former university officials and managers who were responsible when Laurentian became insolvent. It continued to operate while dealing with its financial problems, cutting dozens of staff and programs along the way. “We are also looking into allegations of professional negligence for any professionals who have been here and failed the university,” he said. Tom Fenske, president of the Laurentian University Staff Union, says the union plans to take legal action against former Laurentian managers and officers who led the institution into insolvency. (Erik White/CBC) Fabrice Colin, president of the Laurentian University Faculty Association, said that’s a step they might also consider after they have time to review the auditor general’s report. But Colin added that the university has a new board and senior officials such as the former president and vice-chancellor, Robert Haché, have left the institution. At her press conference, Lysyk thanked Jeff Bangs, Laurentian’s new board chairman, for his “excellent cooperation” while her staff compiled information for the report. At the start of their investigation, Lysyk said Laurentian was not transparent and blocked her office’s efforts to gather information about its finances. “We’ve had the loudest pushback from an organization that I’ve seen in my professional career,” Lysyk said.
Following the recommendations
In a news release, Bangs said the board of governors plans to accept and implement each of Lysyk’s recommendations, which will make the board more transparent. “We are committed to starting the university’s next chapter on a solid financial footing and ushering in a new era of accountability,” Bangs said. “Laurentian students, staff and faculty deserve nothing less.” In two years, Lysyk’s office will contact Laurentian to see if the university has implemented her recommendations. It will then publish a follow-up report. She said her monitoring team will check back with Laurentian in five to seven years to see what progress they’ve made in implementing the recommendations. Sudbury MPP Jamie West and Nickel Belt MPP France Gélinas have introduced a bill to strengthen the auditor general’s role to prevent future audits from being sidelined by court challenges. West said they also want to ensure that the CCAA, which was created for private companies, cannot be used again for public agencies. “I also think it’s important to reach out to our colleagues on the federal side of government to make sure the CCAA is written so that it can’t be affected for publicly funded or publicly funded universities,” he said. “One of the things that stands out shockingly to a lot of people was how much money was spent on legal fees.” Lysyk’s report said the CCAA’s course resulted in more than $30 million in fees for private sector financial advisors and attorneys as of September 2022.
