Former WE Charity chair says she resigned over ‘concerning developments’ at the organization

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The former chair of WE Charity’s Canadian board of directors says she resigned from her position after “concerning developments” at the organization – and that her exit was not part of a routine process.

Michelle Douglas’s comments come after the charity said its board turnover earlier this year was part of a long-planned change, stemming from a 2019 review.

“My resignation as the chair of the board of directors of WE charity was as a result of concerning developments,” Ms. Douglas told The Globe and Mail Sunday.

“I did not resign in the ordinary course of matters.”

This is the first time that she has spoken publicly about the circumstances of her March 27 resignation. She declined to provide more specifics about what happened to raise her concerns.

Ms. Douglas will testify at the House of Commons finance committee on Tuesday about her departure. The committee is studying the controversy over the Liberal government’s now-cancelled contract to have WE Charity administer the $912-million Canada Student Service Grant. WE’s role in the program was announced on June 25 and cancelled on July 3 amid concerns that the Prime Minister was in a conflict of interest due to his family’s ties to the charity.

It was later revealed that Finance Minister Bill Morneau’s daughter works for the charity and that last week he reimbursed WE for travel expenses incurred in 2017. Both Justin Trudeau and Mr. Morneau have apologized for failing to recuse themselves from the cabinet decision to award WE the contract. They are being investigated by the Ethics Commissioner.

The government’s arrangement with WE has prompted questions about the charity’s governance. On July 2, The Globe reported that the size of WE Charity’s Canadian board of directors was reduced from seven to five members. Four of the five are new, while one was on the previous Canadian board. It was further reduced to four directors when one of its new board members resigned in June, citing personal reasons.

In a July 1 statement to The Globe, Gerry Connelly, the only Canadian board member to continue on the board, said “considering a number of board tenures were approaching completion starting in 2019, a well-thought-out process for board renewal occurred.”

On Sunday, WE reiterated its previous statement.

“We have great respect for Michelle Douglas and her contributions during 14-years on the Board of Directors,” it said.

“As previously stated, the organization determined in the fall of 2019 to start a process of renewal of the Board of Directors. This was to address the fact that many Directors term limits were expiring, and also to help plan for the organization’s future with its 25th anniversary in 2020.”

“The original timetable of Summer 2020 as a transition date was moved earlier in order to best position the organization to respond to a predicted multi-year global pandemic,” the statement added.

On July 15, the organization announced another review of its board of directors, along with other changes to the charity’s focus and its relationship with its for-profit affiliate ME to WE.

Last week, several corporate partners of WE announced that they were reviewing their ties to the charity, including Telus Corp., which said it had “mutually agreed” with WE to end the company’s sponsorship before the agreement was set to expire in 2022.

Now the charity is also facing the potential loss of its partnership with Canada’s largest school board. The Chair of the Toronto District School Board is calling for a review of the board’s partnership with WE Charity.

Robin Pilkey is also calling for a temporary suspension of its agreement with the organization, which WE says it “proactively” announced to school boards last week.

Ms. Pilkey is urging her colleagues to support an emergency motion that will halt the activities of WE in TDSB schools until the completion of the review. Her motion calls for a final report that will include “a detailed description of the financial activity between” the school board and the programs WE operates in its schools.

The TDSB oversees nearly 600 schools. The matter is scheduled to be debated on Aug. 4.

Schools have been particularly important to WE’s image and message. Before the onset of the COVID-19 pandemic, WE was known for packing students into stadiums for WE Day, a motivational speaking event featuring celebrity performers, politicians and activists.

Students are invited to attend if they participate in a program, known as WE Schools, and help solve societal problems such as homelessness or hunger in their communities or abroad. WE has partnered with more than 125 school boards and universities across Canada, according to a list of organizations on its website.

In response to questions about Ms. Pilkey’s proposal, WE Charity said in a e-mailed statement that it sent a letter to all of its school-board partners on Friday, alerting them that it “would like to proactively pause the formal and public relationships between school boards and WE Charity.”

Ms. Pilkey said there was no single issue that prompted her call for a review, which is being supported by another trustee, Jennifer Story. She did, however, cite the number of recent resignations of the board of directors of WE’s U.S. and Canadian boards, saying “that’s not generally a sign that says, ‘Hey, everything’s great over here.’ "

Earlier Sunday, a WE spokesperson supplied a quote from Ms. Connelly, a former TDSB director, saying: “WE Charity has had and continues to have strong governance.”

In her interview with The Globe, Ms. Pilkey said she was also unclear on which WE entities were involved with the school board, and how much revenue WE derives from its ties with the school system. (In response to The Globe’s questions, the charity said its partnership with the TDSB is with its charitable wing.) Ms. Pilkey said the point of the review is to get these questions cleared up.

“We’re giving people access to a lot of students and we need to make sure that’s appropriate,” she said.

In response to questions about WE’s history with the school board, the charity sent The Globe a study, performed by consultants, that surveyed 323 students who participated in WE events in California and Illinois, as well as 263 who did not. The survey found that, among other things, the students affiliated with WE were far more likely to have a deep understanding of local and global issues and see themselves as leaders.

The Globe has a sponsorship partnership with WE Charity. The agreement expires on Aug. 31 and will not be renewed.

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