A governance crisis has rocked the CAAT Pension Plan, leading to a series of leadership changes. The plan's CEO, Derek Dobson, has been placed on administrative leave, effective immediately. This decision was made after top executives raised concerns about Dobson's conduct and the oversight provided by the CAAT board of trustees. Multiple investigations into potential governance failures have been initiated as a result.
Kevin Fahey, who was recently promoted to Chief Investment Officer, has been appointed as CAAT's acting CEO and plan manager. The pension plan has also named Audrey Wubbenhorst as its new board chair and Janet Greenwood as vice-chair. This comes after the previous board chair, Don Smith, was removed from his position by the Ontario Public Service Employees Union (OPSEU), which had appointed him. The vice-chair, Kareen Stangherlin, has also resigned as a CAAT trustee.
Ms. Wubbenhorst stated that these changes are necessary to restore trust in CAAT's leadership and governance. She highlighted Mr. Fahey's experience, having worked at the plan for over 16 years, as a key factor in his appointment. However, just last week, a CAAT spokesperson expressed confidence in Mr. Dobson's leadership, creating an intriguing turn of events.
The CAAT board met on Wednesday evening, leading to these latest leadership changes. The Globe is not disclosing the sources of this information due to their unauthorized status to discuss internal matters.
CAAT is a multiemployer pension plan serving Ontario's colleges and over 800 public and private sector employers, with a total membership of around 125,000. Mr. Dobson had been CAAT's CEO since 2009 and faced scrutiny over a $1.6 million vacation payment he received last year, which was contrary to company policy. Additionally, his personal relationship with a CAAT employee for over a year raised concerns.
The vacation payout, compensation for unused time off, was the third such payment Dobson received over several years. Despite internal guidelines limiting vacation carryover or payouts, the board approved these payments. CAAT's board also allowed Dobson's workplace relationship to continue, implementing guardrails to prevent perceived conflicts of interest, but this remained a contentious issue among staff.
An external expert hired by CAAT in December is conducting a governance review, expected to be completed later this month. CAAT's statement emphasized that these governance issues do not impact the plan's financial health or its ability to provide secure pensions.
The most recent financial disclosures show CAAT's funded status at 124%, meaning it has $1.24 in assets for every dollar expected to be paid in pension benefits. The Financial Services Regulatory Authority of Ontario has also been investigating the situation at CAAT and speaking with employees.
With Mr. Dobson on leave, nearly all of CAAT's senior leadership team has changed or left within four weeks, creating a leadership void. This period has been jarring for CAAT, as Dobson was the public face during an ambitious expansion phase. Morale has taken a hit as long-tenured senior leaders departed with little explanation.
"We've gone through a lot recently, and many CAATsters have understandably been upset," CAAT stated in an internal email. "The board determined this change was necessary to restore stability."
The turmoil at CAAT first surfaced internally in November when three top executives approached the board with governance concerns. These internal tensions became public in January when these executives abruptly left the plan on January 19th. CAAT promoted Mr. Fahey to CIO and appointed Scott Blakey as interim executive vice-president and chief people and culture officer, while Jillian Kennedy remained as chief strategy officer.
This governance crisis has sparked an overhaul of CAAT's leadership, leaving many questions about the future of the organization and its ability to navigate these challenges. What do you think about these leadership changes and their potential impact on CAAT's stability and reputation? Share your thoughts in the comments below!
