Doug Ford says he'll fire Hydro One's CEO, board if elected Ontario premier
Ontario Progressive Conservative leader Doug Ford can’t go full-Apprentice in firing Hydro One Chief Executive Officer Mayo Schmidt immediately now that he's won the provincial election.
Ford had pledged to fire Schmidt and the entire Hydro One board once his party took control of Queen’s Park; but under the terms of the company’s governance agreement, it can’t be done with the simple stroke of a pen.
Ford held a press conference announcing his intention to put Schmidt out of a job in April, and reiterated his stance on Twitter.
Schmidt received a total salary of $6.2 million last year, a $1.7-million raise from the year prior.
Even though the province still holds a 47.4 per cent stake in the company, it lacks the authority to directly fire the chief executive of the provincial utility – that power resides with the board of directors.
The province can, however, take steps to replace the board, but the process would likely drag on for two to three months.
The first step would be to deliver a removal notice, informing the board of the province’s intention to replace the existing board.
In response, Hydro One’s chair would put together a committee comprised of representatives from each of the top five shareholders – not including the province – to identify suitable replacements. According to data compiled by Bloomberg, IG Investment Management, Bank of Nova Scotia, FMR LLC, Vanguard and CI Investments are the five largest non-provincially affiliated shareholders, with their stakes in Hydro One held in various investment funds.
Once those replacements are found, the board would hold a meeting on the removal of the current board within 60 days. Only then could the newly-established board oust Schmidt, though the province doesn’t need the support of any other shareholders to put the plan in action.
For its part, Hydro One is refusing to play politics. In a statement, a spokesperson for the utility said Hydro One is cognizant of public criticism surrounding executive pay and has taken steps to address the concerns.
“We have heard the feedback from our customers and the regulator about executive compensation,” the spokesperson said.
“That’s why we decided earlier this year that customers will only pay for the CEO’s salary as it was at the time of the IPO. Hydro One customers will pay two cents on their monthly bill for the CEO’s compensation - this is the same as before privatization.”