UTC took disciplinary action against Nickie

August 4, 2003

Governor Ewart Williams
Governor
Central Bank of Trinidad and Tobago
Independence Square
Port-of-Spain

Dear Governor

RE: APPOINTMENT OF EXECUTIVE DIRECTOR—TTUTC/PRESIDENT, UTC HOLDINGS LIMITED

We have noted your comments and the sentiments of the Honourable Minister of Finance, as expressed in your letter of July 29, 2003.
When I assumed Chairmanship of Trinidad and Tobago Unit Trust Corporation, I set as my primary objective, to implement a Succession and Manpower Plan as advised by you in your letter of August 30, 2002. I had planned to announce the appointment of an Executive Director by July 31, 2003, in light of the expiration of Mr Clarry Benn’s contract on August 31, 2003.
While working on the Succession and Manpower Plan, the following became very clear to me:-
(i) The top three (3) Executives were not working together as a team. There was much internecine conflict. They had much difficulty in relating to one another and the morale among them, as the leaders of the Corporation, could only be described as unacceptable. What was worse was that this behaviour was being closely observed and monitored by other subordinates who began to take sides.
(ii) From interviews and discussions, I discovered that one (1) of our key Executives, Mr Michael Alexander, had considered personal plans to remain with the Corporation for possibly only two (2) more years. With his concurrence, I informed the Board and other Members of the Executive of his plans.
(iii) Executive talent at the top is very sparse, especially if there were one or perhaps two departures.
(iv) The lengthy delay in the legislative restructuring of the UTC has left the organisation without a clear sense of direction and purpose.

We therefore took action as follows:-
(i) We made serious attempts to improve  the situation in (i) above with some  measure of success.

(ii) In consultation with the three (3) Senior Executives,we attempted to implement the Succession and Manpower Plan. All agreed that there was enough good talent within the UTC to fulfill our Plan by a promotion from within process.

(iii) Our plan was to appoint Mr Renrick Nickie to the position of President, UTC Trust Services and Mr Michael Alexander to the position of President, UTC Financial Services, leaving Mr Clarry Benn as Executive Director, TTUTC. These moves would have meant filling their jobs as Executive Managers and creating upward mobility for officers of high potential for future leadership. It would have also assisted in a smooth transition at the very top when the time came, as the Board would have been in a better position to assess the individual performances of Messrs Nickie and Alexander as leaders of their own companies.

While the entire Board and two (2) Members of the Executive agreed with this approach, Mr Nickie, after some deliberation, decided not to accept the position of President, UTC Trust Services, since he indicated that all of these developments should be made only after a new Executive Director was appointed. Although such strategic and manpower plans were frustrated by Mr Nickie’s decision, the Board, nonetheless, agreed to appoint Mr Alexander as President, UTC Financial Services but took due notice of Mr Nickie’s action. Lack of support from Mr Nickie has set back the UTC considerably and prevented it in the main, from implementing its succession for Executive Director. It also pushed us to advertise the position of Executive Director locally, regionally and internationally, so that by August 31, 2003, we would have an Executive Director in place. As the Succession Plan would have commenced operation many months ago but for Mr Nickie’s opposition, we have no confidence in believing that if he is appointed now, he will get the same Plan in place.

For the record, PricewaterhouseCoopers, in their letter of June 16, 2003, indicated “To complete the process it may be useful for a Committee of the Board to interview the two top ranked candidates to make a final determination and recommendation to the Board. Both top ranked candidates demonstrate the intimate knowledge and understanding of the UTC. The defining difference would be the leadership of the UTC over the next five years.” The Board decided to dispense with the recommendation since both candidates were very well known to members of the Board. However, in view of your advice, we have spent considerable time in reviewing our proposed appointment but have declined to nominate the alternative candidate at this time for the following reasons:-
(i) He has not enjoyed a healthy and productive relationship with many members of the Board. In fact, they have asked that he not be allowed to attend any meetings of the Board because of his poor attitude and his abrasive and indelicate approach to them. You will appreciate that this type of information and more would not have been available to PricewaterhouseCoopers but is the considered view of many of the Board, who have closely observed the behaviour of this individual for many years.

(ii) It is also reported that Mr Nickie, on his initiative, attempted to have a Director removed from the Board, although that individual was properly appointed by a private-sector group in accordance with the appropriate legislation. Further, his objection to the Director’s appointment was communicated by e-mail to the Head of the Association and without the knowledge of his Executive Director. The Director involved was obviously offended and raised the matter for discussion with his colleagues at the next convenient Board Meeting, much to the embarrassment and consternation of all. This breach of corporate etiquette and executive protocol was discussed with Mr Nickie by his Executive Director and the incident documented in his last Performance Appraisal for the year 2002. It had the effect of affecting his performance rating and the assessment of his potential for further advancement.

(iii) .As indicated earlier, his personal relationship with his fellow Executives and some members of Senior Management and staff, is not of the standard required for him to lead successfully.
His style is too autocratic while the past and existing leaderships have employed more participative and consultative approaches. To appoint him would require a major cultural shift in the way of the organisation and its people are now managed and led.

(iv) It was necessary for the organisation to take disciplinary action against Mr Nickie as recently as November, 2002. This became necessary because in spite of his executive responsibility for information technology, he had strong personal objections to the implementation of a software system to improve the work in the investment and accounting areas. It should also be emphasised that the project was authorised by the Executive Director. The end result was that the responsibility for managing the IT Department was removed from his portfolio. It was then added to that of the Executive Director in order to facilitate the completion of the work without further impediment.

(v) Investors love stability and a moderate approach to investment. They might find his concepts of leadership and management somewhat extreme for maintaining stability and sustainable growth and performance.

(vi) With the departure of Mr Benn closely followed perhaps by Mr Alexander, the Executive leadership of the Corporation, which is poised for more growth and success, would be too frail and would not engender the type of investor confidence needed for an investment company like the Unit Trust Corporation.
Moreover, there is a shortage of good executive and management talent in Trinidad and Tobago at this time and moreso in the financial services industry so that it would be difficult to find worthy replacements.

The Board has a duty of care and loyalty to the Corporation comprising over four hundred thousand (400,000) unitholders and their $9 Billion worth of investments and after further reflection, consideration and discussion, we feel the risks outlined in (I) to (vi) above are too great for us to accept at this time. We feel it will be safer to invest in the tried and trusted success of Mr Ben’s leadership over the past seven (7) years. We will be fortunate to retain his services. All of this does not mean that Mr Nickie is not a valuable Executive, but, we feel that he needs some more time to accept his areas for improvement and to work on them with seriousness and diligence. In summary, therefore, we thank you very much for your very valuable advice and direction. We, however, feel that our decision, as communicated to you in our letter of June 17, 2003, is in the best interest of the Trinidad and Tobago Unit Trust Corporation. The industry is very competitive and, having struggled to earn investor confidence over the years, we must retain in the final analysis, that that is all we really have to offer.

Yours respectfully
Hubert Alleyne
Chairman