- Friday, April 26, 2024
By: Radhakrishna N S
By Barnie Choudhury
BRITAIN’S only south Asian former permanent secretary, Sir Suma Chakrabarti, has had his stellar reputation damaged and potentially faces career ruin following an investigation when he was president of the European Bank for Reconstruction and Development (EBRD), Eastern Eye has learnt.
Although the internal inquiry – carried out in 2018 – cleared Sir Suma, the shadow of the investigation will follow the British-Indian leader for the rest of his life, he said.
“I think it’s virtually impossible for me to get another international job ever again because this will stick, whether I won the case or not,” Sir Suma told Eastern Eye in an exclusive interview.
“Because the report into my investigation can never be published, many people may believe what they want to believe,” he said.
Eastern Eye understands that Sir Suma did not apply to be cabinet secretary, the head of the UK civil services, following Sir Mark Sedwill’s departure and may also not put his name forward to be the next secretary general of the Organisation for Economic Cooperation and Development (OECD), when the job comes up in 2021.
Sir Suma’s story has never been told in its entirety until now. Following weeks of investigation, Eastern Eye has pieced together what happened to this high-flying and innovative change agent who succeeded against the odds and rose to occupy the second-most senior post in the UK’s civil service a decade ago.
“This episode started in the very early part of 2018, when the bank’s secretary-general had lunches with some board directors,” said one EBRD former insider, who wanted to remain anonymous.
“Off the back of those lunches he wrote a memo based on his notes about an alleged atmosphere of disrespect and a culture of harassment apparently fostered under Suma’s leadership.”
The EBRD invests in private ventures to help grow a country’s economy. Like many institutions, it has an executive board, a board of directors, and a board of governors.
On May 4, 2018, an internal document written by EBRD secretary-general, Enzo Quattrociocche, was leaked to others inside the bank. Weeks later, EBRD’s chief compliance officer, began an investigation into Sir Suma’s conduct, based on complaints from six board officials.
“Enzo was simply doing his job, protecting the interests of the institutions,” said one of Eastern Eye’s sources. “At this stage Suma wasn’t in the frame.
“It wasn’t until 18 July, two months later, that Suma received a letter from the chair of the board’s audit committee telling him that allegations of misconduct had been made against him.”
One of Quattrociocche’s roles is to horizon-scan and safeguard the financial institution and warn it of any possible harm.
We understand that the letter said the bank intended to form an ad-hoc inquiry committee of five members of the EBRD board to investigate its president, Sir Suma. He faced two major allegations.
The first that: “…as president, [you] may not have shown respect in your dealings with board colleagues…may have engaged in conduct that constituted an abuse of authority…and may have encouraged the creation of a hostile work environment that did not foster respect and tolerance.”
In the second allegation, according to the source, “The letter said Suma broke the code of conduct because he may have ‘performed his duties in a manner which undermined public confidence in his integrity and the integrity of the bank’. In other words, he was unethical bordering on corrupt.”
EBRD appointed a Swiss firm to investigate the allegations.
Even though the bank is based in London, Eastern Eye understands that a British company was ruled out, because it was afraid Sir Suma would ‘get to and influence’ the investigators.
The letter did not name Sir Suma’s accusers, and to this day he does not know who complained against him, only that they were six board directors.
“But since EBRD had leaks, it became apparent who it was and who it was not,” said a former insider.
“These were continental Europeans, non-G7 [countries with the biggest economies], and not France or Germany. But think about natural justice. Six people accuse you of something, and you can’t face them?”
To make matters worse, even though they were part of the same institution, the bank would pay only for the legal representation of the six accusers while Sir Suma was left to fund his own legal defence. Had he lost, the former top civil servant would have faced certain termination, no career, and a bill for £650,000.
A source said, “By now things were getting quite Kafkaesque. Someone at the bank was leaking details to the press. It ended up with the Reuters news agency writing a story on October 5 referring to four unnamed directors who had been their sources. What’s extraordinary is the journalist had the full set of documents.”
The bank did investigate the leak, but Eastern Eye understands that to this day it has not been successful in finding the culprit.
“They actually thought I would crumble, to avoid going through an investigation and all that it entails, they thought I would just resign,” Sir Suma told Eastern Eye. “They had history on their side because in previous investigations that’s exactly what happened. But I told the board, I’m going to see this to the end.”
The investigation team had access to all his emails to see whether, as was alleged, he had “bought votes” to win re-election when his first term ended in 2016.
A former insider told this newspaper, “It was clear that someone was desperate and the pressure on Suma was immense. They were piling it on to get him to resign. But he was defiant, determined to clear his name and righteous. They also forgot one thing. People of colour face these hurdles all the time, and they have to be strong, and they underestimated Suma.”
The inquiry finished in November 2018, but it was not until December 12 that Sir Suma received a letter to say he had been completely exonerated and not one shred of evidence suggested he had abused his position or created an atmosphere of toxicity. “It is the inquiry officer’s assessment the alleged misconduct did not occur and neither of the allegations is founded,” concluded the report.
The exoneration broke the allegations down into five main categories, from lack of respect to unethical behaviour via abuse of authority. “There is absolutely no evidence showing that the subject [Sir Suma] took any action or encouraged anyone in any way than in an ethical manner,” the officer said.
To this day, we understand that Sir Suma has never seen the final version of the report which cleared him.
So why was a man, so clearly successful, who wanted nothing more than to complete what he was brought in to do, to reform the bank, targeted?
Does Sir Suma’s experience show what happens when a person of colour tries to transform a white institution?
“You need to understand how EBRD operates,” explained a source. “The management works for the benefit of the bank and bank alone. The directors have an additional responsibility towards their own country, and the national interest always trumps the institutional interest. So, when Suma wanted to change everything, and make the bank more modern and more diverse, that didn’t go down at all well.”
Eastern Eye also understands that some board directors did not like that Sir Suma recruited new country members, in particular from India.
In his leaving speech, which Eastern Eye has seen through one of its sources, Sir Suma spoke about his experiences at EBRD. “I will not miss the stares when I entered the board room in 2012. It felt like entering an English pub when I was a teenager in the 1970s. I will not miss the ‘dog whistle’ messages from some capitals that I was ‘not truly European’ or ‘too global’ for their tastes, real quotes never said to my face but to my colleagues.
“What I say about racism, I could say about all other forms of diversity. To have the advice of one of my female members of ExCom [executive committee] recently described at a board c o m m i t t e e meeting as ‘emotional’ is just another example of unacceptable behaviour. I cannot imagine that would have been said to a man.”
We have also learned that the minority of directors who complained also did not like that Sir Suma wanted to expand the countries in which EBRD operated to include sub-Saharan Africa.
“At 61, all this is nothing new. Depressingly so,” said Sir Suma in his leaving speech.
“But I still feel anger because I will never accept explicit or implicit racism. It still wounds and it must be challenged. And challenged across all the areas of diversity. And if it is bad ethics, it is also bad business, all the research shows diversity in all its forms improves the performance of organisations.”
Sources also told Eastern Eye that their former bank president also ran into difficulties on another issue. After Sir Suma was challenged by BBC Hardtalk’s host, Stephen Sackur, why the bank operated in non-democratic nations, he wanted it to adopt a new position. He suggested that EBRD should say some countries were on a journey towards reaching the EBRD mandate. Despite some opposition, Eastern Eye understands it became the bank’s stance.
“Don’t forget the complaint was made in his second term, after the Brexit referendum and lots of movement in the EU with a carousel of influential jobs coming up for grabs. His job would end a year from then, and some didn’t like him because he was a Brit. With him gone, they could have chosen a French or German. A minority wanted the headquarters moved out of London now that Brexit had happened. Would they have done this if he were a white British person? Not all of them, but definitely those who were anti-change.”
The board never apologised to Sir Suma for putting his family and he through the most painful period of his professional life. In fact, he was only allowed to let internal colleagues know that he had been fully exonerated. “2018 was the worst Christmas I ever had,” recalled Sir Suma. “I’d been cleared, but I always knew I was innocent. I suddenly had time over that Christmas to reflect on what had happened to my family and me. My wife and daughter suffered because they knew the stress this had caused.
“So, instead of jumping for joy, it was a hugely deflating moment realising that this could have happened at all and that there was no redress, not even an apology. Nothing.”
He also knows, despite being completely cleared of any wrongdoing, the inquiry has damaged him professionally.
“The OECD job is coming up next year, for which I have many of the obvious credentials, but there’s no way the UK can nominate me. I know that, because they can’t get the votes, and the case will be brought up in the conversations, even though I won it.”
Investigators also found no case against Quattrociocche.
Eastern Eye understands that some board members tried to pressure Sir Suma into removing Quattrociocche permanently, but he refused, and he remains secretary-general today.
Jonathan Charles is the managing director of communications at EBRD, and a member of the bank’s executive committee. He gave evidence to Sir Suma’s investigators, but he would not answer questions put to him by Eastern Eye.
In a statement Charles said, “The investigation found there to have been no evidence of wrongdoing, and Sir Suma was completely exonerated.”
