Addressing conflict of interest

9 November 2018

Environment Southland chief executive Rob Phillips has moved quickly to put in place a robust system to manage any conflicts of interest following an independent report in October, which pointed out the Council’s informal approach and lack of documentation.

The independent report was written by Bruce Robertson who is the independent advisor to the Council’s Organisational Performance and Audit Committee and a former Assistant Auditor-General who works with many other councils throughout New Zealand. He found no evidence that the director was involved in any way in decisions to engage the company or in the monitoring of its work, but did highlight informal processes and a lack of documentation.

The report specifically addressed the relationship between Vin Smith the Council’s director of policy, planning and regulatory services and his wife’s company Envira Consulting Limited. At the time, the director had a shareholding in the company, which had done work for the Council.

Upon the release of the report, the Council suspended all work with Envira while it reviewed its processes and has now put more rigorous measures in place for working with the company.

Environment Southland chief executive Rob Phillips commented:

“The report found no wrong doing, and I want to make it clear that Vin Smith has acted with integrity from the start and continues to be a well-regarded and valuable director. I am confident that the practices put in place at the outset when Vin first flagged the conflict were followed by staff, but the lack of documentation was an unacceptable oversight and I’m sorry for any concern this may have caused. Perception in matters as important as this cannot be underestimated and I have moved quickly to rectify the issues around documentation and to ensure our system is robust and transparent.”

As part of the implementation of the Council’s conflict of interest policy, the chief executive will have direct responsibility for any matter where Envira is engaged for the purpose of doing business with the Council. Vin will not take part in any decisions – whether administratively or regulatory in nature, if it involves Envira.

Vin Smith divested his shares in Envira in October 2018.

Envira was contracted to Environment Southland via an expressions of interest procurement process, where staff were satisfied that the company met the criteria of sufficient knowledge, experience and capability. Envira was distinguished from others who lodged expressions of interest by their knowledge in niche and technical areas, particularly air quality and contaminated land. At the time, other contractors were also engaged as a result of this process.

“It is important that Southland continues to have access to the specialised skills Envira can contribute to good environmental outcomes. And, I’m hopeful that the formal arrangements we’ve put in place will allay any concerns people have had and reassure them that these have been effectively addressed,” said Rob Phillips

During September and October 2018 there was some media interest in this situation. At the time the Council was progressing a conflict of interest policy, which was adopted in October 2018. It was developed in accordance with best practice, including guidance from the Office of the Controller and Auditor-General, which has been kept informed of the situation and provided input into the policy. The policy sets out the expectations and responsibilities for staff and acknowledges that potential conflicts of interest are inevitable and need to be appropriately managed.

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Page reviewed: 09 Nov 2018 12:00am