At its meeting on 16 December 2014, the Commission authorised five new roles for Connie Hedegaard “provided that she refrained from lobbying the Commission and its departments, should any of these organisations ask for financial support from the European Union”. These roles were: chair of the board of the Kann Foundation; external member of the board of Århus University; chair of the Danish Ministry of Culture’s Public Service Committee; co-chair of the ‘R 20’ initiative; and chair of the OECD Round Table for Sustainable Development.
Hedegaard had also emailed the Commission for authorisation for an additional activity. The Ad hoc Ethical Committee provided its opinion to the Commission on the sixth role on 5 December 2014. Hedegaard then provided further information on 22 February 2015. The Ad hoc Ethical Committee provided a further opinion on 26 February 2015. Following an email from Catherine Day (the then Secretary General) on 5 March 2015, Hedegaard withdrew her request for authorisation. The details of this withdrawn role were not made publicly available at the time, but Hedegaard has subsequently confirmed to EUObserver that it was board membership of Danfoss, a role she later accepted at the end of the 18 month cooling-off period contained in the Code of Conduct for Commissioners. The cooling-off period ended on 30 April 2016; Hedegaard was elected to join the board of Danfoss on 29 April 2016.
Connie Hedegaard was commissioner for climate action in the Barroso II Commission until October 2014. Prior to that she had been minister for climate change in the Danish government under Prime Minister Anders Fogh Rasmussen, who has also appeared on CEO’s RevolvingDoorWatch project. Since leaving the Commission, Hedegaard has taken a number of new roles.
The KR Foundation
In late October 2014, while Hedegaard was still in her Commission post, the Danish media reported that she would become chairman of the board of a new foundation called the Kann Foundation (now known as the KR Foundation), as of 1 January 2015. “The purpose of KR Foundation is to promote projects that help show the way towards sustainable societies”, said Hedegaard at its launch. The KR Foundation was set up by the Villum Fonden which intends to fund it with DKK1billion over the next 10 years. The Villum Fonden is part of the Velux foundations and is a non-profit foundation that supports technical and scientific research as well as environmental, social and cultural projects in Denmark and internationally.
It was a concern for CEO that Hedegaard's new role at the foundation was announced to the media (26 October 2014) before it had been authorised by the Commission, and even before it had been notified and authorisation had been requested by Hedegaard (11 November 2014). While the rules in the Code of Conduct for Commissioners appear ambiguous on this point, it cannot be appropriate to publicly announce new roles before authorisation has been received. Ex-commissioners should, at all times, ensure that their actions and those of their proposed new employers, do not imply that Commission authorisation is either a formality or a foregone conclusion.
On 29 April 2016, the annual general meeting of Danfoss appointed Hedegaard to the board of directors. Danfoss is a major Danish engineering firm producing refrigeration and air-conditioning, with a clear interest in energy efficiency and other climate related technologies.
At the time of Hedegaard’s appointment, Chairman of the Danfoss Board Jørgen M. Clausen on the Group’s new Board member:
“I am very pleased to welcome Connie Hedegaard to the Board. Because of her experience as a Minister and an EU Commissioner, Connie Hedegaard has a unique background. Internationally she is known for her extreme competence within climate, environmental and energy issues, and her skills are a very good match for Danfoss.”
Danfoss is a major EU lobbyist. In 2014 (the most recently available figures), it declared spending €300,000-399,999 on lobbying the EU; it has five European Parliament passholders and has held at least two high-level meetings with the Commission since December 2014.
As made clear above, Hedegaard had previously applied to the Commission for authorisation to join the board of Danfoss in November 2014. But she withdrew her application on the advice of the Commission, apparently after a negative opinion was issued by the Ad hoc Ethical Committee. On waiting to accept the Danfoss role (until after the 18 month cooling-off period demanded by the revolving door rules had ended), Hedegaard told EUObserver:
“I think it makes sense that these transition rules exist. I respect them, and Danfoss was willing to wait until the end of the ban.”
On 28 September 2016, Volkswagen announced that it had recruited Hedegaard to its new Sustainability Council. In September 2015, Volkswagen was caught cheating on emission tests using defeat devices in its vehicles’ diesel engines. The company has been ruled to pay $14.7 billion dollars (13.28 billion €) to US authorities for buybacks, damages and penalties resulting from this ‘Dieselgate’ emissions scandal.
VW has told CEO that this is an unpaid role and VW has emphasised that the board (which also involves a former official from the US Environmental Protection Agency and a former prime minister of Belgium) will be independent and will set its own procedures.
Hedegaard told EUObserver:
“It’s an unpaid position with no strings attached. We will meet once or twice a year and give advice to a company that did things in a bad way on how to become more environment-friendly and sustainable.”
She also told Danish newspaper Politiken that
“When a sinner who has behaved very badly, asks for help to become more green, I am happy to help. In my view, we have to work with those that aren't green angels, otherwise we won't make any progress. But clearly, if after a while, say six months, nothing happens, then someone like me could decide to leave them again.”
As climate commissioner from 2010-14, Hedegaard was responsible for regulating carbon dioxide emissions (CO2) from vehicles, and between July 2012 and April 2014 she led the EU’s 2020 review of CO2 limits for new passenger cars and vans.
The Commission's rules
The current code of conduct for commissioners says that when they leave office they must abide by an 18 month notification period, during which time they must seek Commission authorisation for any new professional activities. The code further stipulates that the Commission should seek the view of its Ad hoc Ethical Committee if the new professional activity is related to the commissioner’s former portfolio. All commissioners are banned for 18 months from lobbying “members of the Commission and their staff for his/her business, client, or employer on matters for which they have been responsible”. The lobby ban is waived when former commissioners take up public office. In CEO's view, there are several loopholes and problems with these rules. The notification and lobby ban periods are far too short; lobbying is not defined; and the targets and content of proscribed lobbying are too narrowly-drawn. The process to authorise commissioners’ new roles, and to uphold the rules, also need to be overhauled, including the Ad hoc Ethical Committee.
As an ex-commissioner, Hedegaard is entitled to a very generous transitional allowance after she leaves the Commission of between 40 and 65 per cent of final basic salary for the three years after she has left office. In addition, the transitional allowance scheme provides for commissioners to earn up to a further €9000 (approximately) a month from other sources without their pay-out being affected. In CEO’s view, the transitional allowance, the purpose of which was to enable ex-commissioners to not have to seek out immediate new employment, and thus avoid the risk of possible conflicts of interests, clearly needs to be reformed.
Before publishing this statement, we contacted Hedegaard for her comments; she did not reply.
“Many of Hedegaard's new roles are linked to her former portfolio of climate action and it is vital that the ban on former commissioners’ lobbying the Commission is extended beyond the current 18 months to at least three years. Additionally, the Hedegaard case shows that the rules need to be far more explicit about former commissioners who negotiate new roles while in office; the opportunities for conflicts of interest in this context are self-evident.
“It is interesting that Hedegaard’s role at Danfoss was rejected by the Ad hoc Ethical Committee during the 18 month cooling-off period. This case shows why it is imperative that the Commission pro-actively publishes all committee opinions on all cases so that we can properly assess the reasoning that rejects a role in April 2016, but permits it in May 2016. The committee, already busy with formulating opinions on the Kroes and Barroso cases, should be asked to provide a further updated opinion on the acceptability of this case too on the basis of EU treaty article 245 which places an ongoing duty of "integrity and discretion" on former commissioners. Time-limited rules will always have a cut-off point but 18 months continues to appear far too short to CEO, considering the seniority of former commissioners.
“As for Volkswagen’s Sustainability Council, it is CEO’s view that all of its members will need to work hard to avoid being used for VW’s greenwashing efforts. As the European branch of the company is still in denial about the deceitfulness of its illegal cheat devices, it is highly questionable whether Volkswagen is actually committed to making up for its previous foul play.”