The Corporate Governance Struggle of GEBE Part Two ~Instability and leadership blackouts~

While St. Maarten has had ten governments since 2010, the instability is reflected in one of the island’s most prominent government-owned companies- NV GEBE. In the last ten years, there have been nine shareholder representatives of GEBE. They came from either the National Alliance, United People Party, or the United Democrats.

 Two of these parties are currently part of the present government. Nevertheless, the instability at GEBE stems from the frequent changes of the management board. Throughout the years, starting from 2006 to 2021, the company has seen 12 management board appointees, eight (8.) appointed managing directors, and four (4) appointed interim managing directors. During that same period, the company has seen six (6) different supervisory board chairman. 

A noteworthy mention is the term given to the Management Board. Their contract is three years- one year shy of the political cycle. For a corporation like GEBE, which has a longtime monopoly in water and electricity distribution, three years is certainly not enough to implement the necessary changes that the company needs.

 This constant changing of persons, both the Supervisory board and managing director seat, is seemingly done with intent, allowing for political meddling.

The government-appointed Supervisory Board of Directors (SBOD) often made decisions contrary to the company’s general interest. These supervisory board appointees also interfered with the Management Board’sBoard’s strategic objectives, typically for a government’s agenda(s). While the government is the sole shareholder of GEBE, corporate governance rules are established to prevent the many trials GEBE experienced, given the political nature of the relationship.

The first director of the company was the late Julius Lambert. He retired from the position in 2006 after two decades of service. The late William Brooks then took over the mantle on January 1, 2007, until 2011. Brooks introduced a comprehensive strategic plan that would have significantly transformed the company, positioning it for the new millennium. The strategic plan implemented by Mr. Brooks, and his management team at the time, ended in 2020 with some omissions. Paul Marshall replaced Brooks and served as interim Managing Director from 2011 to 2012. Marshall reportedly trashed Brooks’ strategic plan. 

Then came the Chief Financial Officer (CFO), Ivan Solomon's appointment, and chief operation officer (COO) Romelio Maduro from 2012 until 2013. This was the first time two persons were appointed as directors. Solomon then resigned on December 31, 2013. Solomon tenure officially ended on September 30, 2013. From 2013 until 2014, Maduro served independently. 

Maduro’s contract ended in controversy due to allegations of misuse of funds and other financial irregularities. Mr. Rene Gartner was appointed CFO from 2015 to 2015. Gartner also served independently after being placed on inactive duty on December 1, 2015. Gartner's contract was terminated in February 2016. Brooks returned as interim manager in 2015 until 2016. GEBE’s finance manager, Andrew  Zagers became the next interim Managing Director from January 2016 to August 23, 2016. Former company CEO Kenrick Chittick and former CFO Iris Arrindell were joint interim Managing Directors until serving as the first Management Board. That board included Veronica Jansen as COO from 2016 to 2020. 

During the trio's tenure, they were challenged by two major disasters: hurricanes Irma and Maria and the ongoing covid-19 pandemic. The disasters resulted in significant financial losses for the company. However, it was not the beginning of GEBE's economic downturn. Before the hurricanes, the government collected millions from GEBE to support budgetary shortfalls. After the hurricanes' onslaught, the company took a financial hit. Unfortunately for the company, several assets were not insured, including buildings and part of the power plant. A substantial amount of GEBE's distribution infrastructure was damaged and also uninsured. 

 According to the Netherlands General Audit Chamber report, GEBE’s reserves dwindled from before hurricane Irma. The challenges and losses were many; however, the former Management Board and GEBE employees worked tirelessly to recover from Irma. 

 The present challenge for GEBE lies with the pandemic and the corporate struggle around the next CEO. At least two (2) persons resigned from the supervisory board in the last month. The current SBOD is also awaiting a decision from the judge on two (2) cases regarding their motion to bar the appointment of Sharine Daniel as CEO. Jairo Bloem, the company’s legal counsel, also filed a suit at the Prosecutor's office. His actions followed allegations from the former chairman of the SBOD Bienvenido Richardson that Bloem overstepped his function as external counsel. 

The Minister of VROMI’s made a statement on September 8, Council of Minister's press briefing about the need to fill five (5) vacancies on the SBOD. “A meeting request will be sent out this week to convoke the meeting to install the new members to fill the board… with respect to the appointment of the new Managing Board, that is also ongoing and they’re in discussion with the respective individuals. I haven’t received any recent update as to the state of affairs of that negotiation but I know for a fact that it is ongoing because I see communication going back and forth. Nevertheless, it will be handled very soon.”