In the most recent fallout over allegations of corruption at Montreal-based SNC-Lavalin Inc., the global engineering and construction firm and more than 100 of its affiliates have been debarred from working on World Bank projects for 10 years, according to a negotiated settlement between the firm and the bank.
The agreement, reached in April, is linked to the longest debarment ever imposed by the World Bank. It results from a bank probe into allegations of bribery and corruption on the Padma Multipurpose Bridge project in Bangladesh as well as similar allegations in connection with a bank-financed rural electrification and transmission project in Cambodia.
SNC-Lavalin and its affiliates also are debarred from bidding or working on projects financed by the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank and the African Development Bank.
SNC-Lavalin estimates that World Bank-financed projects represent about 1% of the company's annual revenues.
Under the terms of the settlement, some of the affiliates of the SNC-Lavalin Group, SNC-Lavalin Inc.'s parent company, will continue to be eligible to bid on and be awarded World Bank Group-financed projects as long as they comply with the settlement's requirements. Moreover, SNC-Lavalin's suspension could be lifted after eight years if the terms and conditions of the settlement agreement are complied with fully.
"The company's decision to settle signals our determination as we go forward to set standards for ethics in business conduct and for good governance that are beyond reproach," says SNC-Lavalin Group CEO Robert G. Card. Named to head the firm last year, the former CH2M Hill executive has replaced most of its former management.
Earlier this year, the firm hired its first chief compliance officer."We want to draw a line in the sand between the past and the future," Andres Pohlman said in an interview last month.
On May 1, Gwyn Morgan, the firm's board chairman, will step down, along with three other board members. Leslie Quinton, senior vice president of global corporate communications, says, "All four who are stepping down were originally scheduled to last year but stayed on because of the circumstances."
Separately, on April 16, the city of Montreal barred local design firm Dessau Inc. from bidding on municipal work for five years, following testimony from a company executive last month in a government-industry corruption inquiry that he was involved in a contracting collusion scheme.