John MacDonald – who, depending on who you ask, is either the chair of Rogers Communications Inc. (RCI) or a former director who was sent packing – has blasted Edward Rogers’ portrayal of events in the power struggle that erupted at the telecom giant, and said frustration with Mr. Rogers pushed numerous directors (including himself) to contemplate resigning.
In a sworn affidavit filed with the B.C. Supreme Court on Friday, MacDonald dismissed Mr. Rogers' argument that he and four other directors – dubbed the "director group" (Bonnie Brooks, Ellis Jacob, John Clappison, and David Peterson) – dug in their heels in the aftermath of Mr. Rogers’ failed attempt to force out RCI's chief executive, Joe Natale.
"The suggestion that the director group is seeking to entrench itself is preposterous..." MacDonald said. "We gain nothing from a public dispute with Edward or from our continued positions on the company's board. The issue that motivates us is proper governance for a significant Canadian publicly traded company."
In his affidavit, MacDonald said he was "quite disturbed" when he initially heard from Mr. Rogers on Sept. 15 that he was looking to replacing Natale with the company's (now former) Chief Financial Officer Anthony Staffieri.
According to MacDonald, in the days that followed, four of RCI's independent directors indicated that they might resign based on Mr. Rogers' tactics in attempting to replace Natale.
“However,” he wrote, “we ultimately took the view that the resignation of a number of directors would be highly disruptive to RCI, potentially increasing the risks associated with the company’s acquisition of Shaw Communications.”
As the turmoil unfolded, at a board meeting on Sept. 24 where Mr. Rogers earlier stated in his affidavit the company’s directors voted almost unanimously to accept Natale's resignation, MacDonald said he was actually under the impression Natale had effectively already been single-handedly fired by Mr. Rogers and that directors were simply voting on the exit package. According to MacDonald, fellow director Peterson (the lone holdout in a 10-1 vote on Natale's transition terms) tendered his resignation, though he was later convinced to withdraw it.
"We could not understand how the company had been placed in such a situation," MacDonald said.
None of the claims have been tested or proven in court.
MacDonald elaborated in his affidavit about his views on the importance of proper corporate governance procedures. He said he thought Mr. Rogers was doing a runaround in the ultimately doomed attempt to oust Natale, as well as when he later acted unilaterally to replace a handful of the company's directors, including MacDonald himself.
"Ultimately, the (Rogers Control) Trust will determine who serves on the board. However, supervising and replacing the company's chief executive officer falls within the purview of the board; and changes to the board can only be undertaken in accordance with the relevant laws and requirements of the company's articles.
"Proper governance cannot simply be ignored when Edward believes it is convenient to do so, and the members of the director group believe that the maintenance of good governance practices is in the best interests of the company."
MacDonald and Mr. Rogers are effectively shadowing each other for the same role presently.
MacDonald inherited the responsibility of chair of RCI's board after Mr. Rogers was voted out in the aftermath of his attempt to replace Natale.
Mr. Rogers, however, claims to be the company's chair after being voted into the role at a meeting of the hand-picked board of directors that he established after he availed himself of his power as chair of the Rogers Control Trust to single-handedly replace five directors last month (including MacDonald).
The Control Trust is RCI’s controlling shareholder, holding approximately 98 per cent of the company’s Class A voting shares.
The dispute about who the rightful board of directors is will land in a B.C. courtroom on Monday after Mr. Rogers petitioned to have his board recognized as the company’s top governance body.
"Irrespective of the fact that Edward is effectively the controlling shareholder of the company, was the chair of the board and is the son of the company's founder, it is unacceptable that a publicly traded company would be governed in such a manner," MacDonald said in his affidavit.
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