Not since the selection of Claude Clarke as PNP candidate in 1986 and his subsequent appointment as Minister of Industry and Commerce in 1989 has so much excitement been generated in the naming of a Minister from the private sector. The anointment of Don Wehby (Deputy CEO of Grace Kennedy until recently) as Minister without portfolio in the Ministry of Finance and Public Service is just another circus passing through.

Past performance

In terms of performance, achievement and charisma Mr. Wehby is no match for Mr. Clarke. Yet we have seen the frailty of human in the demise of the once invincible Highgate Foods and with it the good fortune of its Chairman.

Don joined the Board of Grace in 1997 and a review of the company’s performance since, shows basic earnings per share (eps) moving from $3.99 to $5.67 in 2006, an average annual growth of 4.96%. The EPS has held around the $6 mark for the last five years. In the period 1997- 2006, the share price on the Jamaica Stock Exchange (JSE) grew at an average of 24.3%. He has not done badly himself, his interest (holding) in the company’s shares (mostly acquired under the stock option plan) moved from 647k in 1998 to 1,706k by 2006 (average 20.5% per annum), and is more reflective of the stock price appreciation than the company’s performance.

Grace and politics

It was the former Chairman of Grace Kennedy, the late Carlton Alexander that nurtured the involvement of company officials in the wider community, including politics. He was instrumental in the formation of the Private Sector Organization of Jamaica (PSOJ) in 1976 and in 1977 led negotiation for the attempted acquisition of Grace by the government. His was the dissenting voice in the call by the PSOJ for the resignation of the PNP government in 1980. He was later appointed Chairman of the Prime Minister’s Committee for Investment and Employment in 1983.

Mable Tenn became a board member of Rural Agricultural Development Authority (RADA) in 1990 and the current Chairman of Grace, Douglas Orane, served as an independent Senator for one term from 1998- 2003.

Mr. Wehby is not the first employee from Grace to play an active role in governance.

Risk assurance

Although Mr. Wehby has not demonstrated superb competence in his role at Grace, it is the Prime Minister’s prerogative to select members of his team and for which he will ultimately have to give account to the electorate. The Hon. Bruce Golding should however be cognizant that the arrangement under which Mr. Wehby is secured from Grace is severely lacking and unacceptable on two fronts:

(a)    Contribution in whatever form as remuneration by Grace

(b)   His shares in the company being under his control.

On the first point, there is an old adage “he who pays the piper calls the tune”. Probity demands that Mr. Wehby accepts no compensation from his former employer since he no longer provides them a service. Men of lesser means and possibly with more to offer have given of themselves in the interest of their country, and if Mr. Webhy is so inclined it should not be at the expense of shareholders of Grace. This is a publicly traded company and assuming they run a tight ship, then somebody somewhere will need to fill that vacancy. Are they willing to pay twice for the same job, and what if another employee is summoned to serve, and still another, could they be assured the same privilege available to the first?

This brings in the second point. Mr. Wehby has significant stake in Grace and whether dictated by law or not, as an Accountant, he ought to be sensitive to appearances and perceptions. His shares should have been placed in a Blind Trust immediately prior to his appointment, or as soon as possible thereafter. And for those that argue that his ministerial salary could hobble him financially, his shares in Grace are valued over $100m, the choice is his. There are a lot of things that a lot of people cannot afford to do, so they don’t. What Danny Williams did in the 1970s as a minister of government and director of Life of Jamaica (LOJ) is irrelevant, back then anybody could trade currencies on the street, now, it requires a licence. Things change over time and regulations must keep pace if we are to prevent a repeat of what happened in the financial sector in the 1990s.

Poor judgment 

For Mr. Wehby to have resigned after a howl of protest brings into question the judgment of Misters Golding, Orane and Wehby. The latter two have demonstrated in the past similar misgivings when in 2002 Grace Kennedy Pension Scheme purchased shares in Kingston Wharves and posited that Grace did not have control over the Pension Fund. They ultimately lost footing and were forced to either make an offer for all the outstanding shares or sell their holding; they chose the latter costing shareholders millions in potential gain.   

Mr. Golding has already come under fire about the size of his Cabinet since it is larger than that of the previous government. However, it is not too late to save the day by telling Mr. Wehby that it is not prudent for Grace to contribute to his remuneration if he is to remain a minister. Secondly, his interest in Grace must be placed in a Blind Trust.

These decisions are likely to be forced on Bruce so it is better that he recognize the tide swell and act now or the “Flip Flop” label will gather traction. 

Mr. Wehby for his part need not look bad either, he could make his first submission to parliament be of the kind that allows for seamless transition from private to public and vice versa. He should also temper the expectation of the public by seeking their suggestions or it could end up as a millstone around his neck.