What is going on at the Trudeau Foundation?
The Trudeau Foundation bears the name of one of Canada’s most prominent political families. But now, its entire board has resigned.
Such mass resignations happen in business, almost exclusively when things get tough.
But why, though? Why has the entire collective leadership of a major Canadian non-profit dropped everything and walked, making headlines worldwide?
What’s going on?
This week, The Trudeau Foundation announced that its entire board of directors and its president and CEO had resigned. Three directors will carry on in a caretaker capacity until a more permanent transition is implemented.
What is the Trudeau Foundation?
It’s a Canadian charity set up in the early 2000s to focus on social issues through grants, scholarships and mentorships.
It is named after former Canadian Prime Minister Pierre Trudeau. His son – current Prime Minister Justin Trudeau – divested his interests in the organisation when he took office and has no connection to it.
What has the foundation said about the resignations?
It said that the trouble stems from a single donation of C$200,000.
Multiple media outlets reported in February that the donation came from a Chinese businessman and may have been orchestrated by Beijing as part of a planned campaign to gain influence in Canada.
From there, the donation was swept into a broader probe of Chinese interference in Canadian elections.
The Trudeau Foundation previously advised that the donation was only partially paid, with the remainder outstanding. It has also confirmed that it returned this partially-paid sum.
Why has the board resigned?
The official line is that the controversy surrounding the donation has amounted to the “politicisation” of the foundation as a whole. It has put “a great deal of pressure” on its corporate leaders to maintain the status quo.
Whether the donation was the sole reason for resigning en masse or the straw that broke the camel’s back is up for debate. However, at least one outlet has said that other governance issues had played a part – specifically poor record-keeping.
If this is true, it suggests that the organisation’s corporate leaders had problems with their ability to manage risk, specifically oversight and reputational risk.
So, they resigned because of too much pressure?
Ultimately, yes, it looks that way.
The board likely felt it lacked the capacity or support to manage the foundation through this current reputational crisis. There may also have been a degree of fear that staying on might eventually put them in a spotlight they should best avoid.
In other words, if the foundation endured more investigations, penalties, fines, and even legal action – the directors would want to steer clear of any responsibility for that fallout.
Are mass board resignations common?
They’re probably more common than you would think. For example, Canada saw another mass resignation in a prominent national organisation just months ago.
These resignations often convey that a board has no confidence in itself to navigate a turbulent time in the company’s life.
That is a bad position to be in – not only for directors but the company too.
It puts giant question marks on the company’s future viability. Any replacement board will have difficulty convincing other stakeholders that it can bounce back.
How the Trudeau Foundation handles the next few months will be critical.
