The Barroso Commission approved Reding's moves to the Bertelsmann Foundation and Nyrstar in its meeting of 29 October 2014. She was told to avoid conflicts of interest "in particular when projects of the Bertelsmann Foundation involved requesting and/or obtaining Community cofinancing" and that she should, within 18 months after ceasing to hold office, abstain from lobbying and defending the foundation's interests to the Commission. She was also told to abstain from lobbying and defending Nyrstar's interests to the Commission for 18 months.
On 10 December 2014, the Commission approved Reding's move to the board of Agfa-Gevaert, and again she was told that, within 18 months of ceasing to hold office, she should abstain from lobbying and defending the company's interests to the Commission.
On 16 December 2014, the Commission approved Reding's plans to work with "various Speakers Bureaux, including Premium Speakers Deutschland and Celebrity Speakers UK" as well as her participation on the board of the UEFA foundation for children.
On 18 February 2015, the Commission approved Reding's move to join the advisory board of thr Global Economic Symposium.
The Commission's ad hoc ethical committee was asked to advise only on the Bertelsmann Foundation move.
Reding had been an EU commissioner since 1999, taking the portfolios of education, media and then finally justice. She left the Commission after becoming an MEP in the May 2014 elections.
We consider that the role of board member at Nyrstar should not have been authorised as it represents a potential conflict of interest with Reding's previous roles as EU commissioner. Not least, Reding was a commissioner for 15 years and she took collective decisions on many issues that are likely to be of direct interest to Nyrstar as a European company. As a board member she will have a fiduciary duty to act in the interests of Nyrstar and this could bring her into conflict with her ongoing commitments to the Commission and the wider public interest. In our view, there should be a three-year ban on former commissioners accepting such roles.
As required by the commissioners' code of conduct, Reding has been told to abstain from “lobbying and defending Nyrstar's interests to the Commission” for 18 months. However, this ban is too narrowly drawn because it only covers direct lobbying activities by the ex-commissioner herself, meaning that Reding could still advise others at Nyrstar on how best to lobby the Commission or contribute in other ways to Nyrstar’s lobbying at the EU level. The lobby ban is also too short.
Furthermore, Reding is now an MEP and is subject to the code of conduct which says that: “A conflict of interest exists where a Member of the European Parliament has a personal interest that could improperly influence the performance of his or her duties”. We consider that becoming a director at Nyrstar has the strong possibility to conflict with Reding's work as an MEP, including her role on the international trade (INTA) committee. During her time in Parliament, Reding will have to vote on issues that are highly relevant for Nyrstar, such as the upgrade of the EU-Mexico free trade agreement. Nyrstar operates internationally including in Mexico.
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.
As an ex-commissioner, Reding 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.
Background on Nyrstar
Nyrstar was founded in 2007 through the merger of the Australian mining company Zinifex and the Belgian materials company Umicore. Its main business areas are zinc mining and lead smelting. Since 2009 Nyrstar has expanded its involvement in zinc mining, acquiring mines in Peru, Chile, Mexico and Honduras.
There is an EU-Mexico free trade agreement and the Commission and Mexican authorities are currently considering upgrading this. Reding is a member of the European Parliament’s international trade (INTA) committee. The INTA committee and the full Parliament will have to approve an upgraded agreement.
In 2013, Nyrstar was fined more than US$140,000 by Peruvian authorities for violating environmental regulations. Nyrstar is reported to have dumped mining wastewater in a gorge exceeding the maximum concentration in zinc, iron and total dissolved solids, which, as the environmental tribunal concluded, could adversely impact health, human well being and the environment.
In October 2014 the Chilean environmental authorities brought charges against Sociedad Contractual Minera El Toqui for allegedly infringing various environmental regulations, such as unauthorised discharges of mining fluids, the failure to construct monitoring facilities for water quality and the failure to carry out promised reforestation programmes. Sociedad Contractual Minera El Toqui is a 100 per cent subsidiary of Nyrstar.
Nyrstar says that “Our aim is to minimize the environmental impact of both our production processes and our products. We will conduct our operations in compliance with all relevant environmental regulations, licenses and legislation.”
Nyrstar are not listed in the EU lobby register themselves [Update: Nyrstar joined in April 2015], but in 2013 they employed Russchen Consultants who are registered and who record them as a client. Russchen says it brings “the EU closer to our various clients - both by enhancing their access to people, access to information and access to funding...”. Nyrstar is also a member of Eurometaux, the trade association representing the non-ferrous metals industry, which in 2012 had a lobby budget of €1,500,000 - €1,750,000.
Reding and the Bertelsmann Foundation
LobbyControl asserts that Bertelsmann is likely to benefit enormously as a media and services company from the political knowledge of Reding. The ex-commissioner brings insider know-how in the media, privacy and education sectors, all of which are of interest to Bertelsmann. Reding was also a vice-president of the Commission, which initiated the TTIP free trade agreement between the US and the EU. Bertelsmann is a global service company likely to benefit from TTIP. Meanwhile the Bertelsmann Foundation has massively promoted TTIP.
The board of trustees of the Bertelsmann Foundation is an advisory and monitoring body that is closely involved in the strategic decisions of the foundation. The remuneration for the charitable foundation is generous. Paragraph 21 of the statute of the foundation states: "The members of the Board of Trustees, by taking up their duties, and as long as the income of the foundation permit, receive an annual base salary of 30 percent of the basic remuneration of a Supervisory Board member of Bertelsmann AG." In 2012, this was an average of €60,000. Reding is expected to join the foundation in January 2015.
Even if the trustees are not directly part of the company, it is closely connected with Bertelsmann. The foundation holds 77.6 per cent of the shares of the Bertelsmann Group and the board of trustees share staff with the supervisory board of Bertelsmann including: Liz Mohn, Christoph Mohn and Werner Bauer.
There were extensive contacts between Commissioner Reding and the Bertelsmann Foundation while she was at DG Just, available here.
Update January 2015: Reding's move to Agfa-Gevaert
CEO has now learnt that the Commission has also approved Reding's move to join the board of directors of Agfa-Gevaert which, according to its website, "develops, produces and distributes an extensive range of analog and digital imaging systems and IT solutions, mainly for the printing industry and the healthcare sector, as well as for specific industrial applications". Agfa is a major Belgian company; it does not appear on the EU lobby register.
Agfa and Nyrstar have the same chairman of the board of directors, namely Julien De Wilde. Roland Junck, who until November 2014 was the chief executive of Nyrstar, has also simultaneously been a director of Agfa-Gevaert in the past.
It is not known when Reding will take up her roles at Nyrstar or Agfa-Gevaert. At the time of writing (6 January 2015) she is not listed on either corporations' website and her current MEP declaration of interests lists neither roles.
Update 27 April 2015
At this point in time, Reding has not joined the board of Nyrstar. The papers for the 2015 Nyrstar AGM on 29 April 2015 do not indicate that Reding's name has been put forward.
Agfa-Gevaert has now confirmed that its AGM on 12 May 2015 will be asked to approve Reding as an independent director.
Before publishing this statement, we contacted Viviane Reding for a response to our concerns; she did not reply.
Update 28 October 2015: You can read our new report The revolving doors spin again, Barroso II commissioners join the corporate sector on our website. The report includes this case and many others, analyses all the revolving door moves of the Barroso II Commission and includes a spreadsheet which collates all known information about the 100 plus new roles of the former commissioners.
“It seem that once again the revolving door between the college of commissioners and big business is spinning. Reding has been one of the longest-serving EU commissioners and it is not hard to imagine how her 15 years at the heart of the Commission, combined with her new role as an MEP, makes her an ideal catch for Nyrstar, the Bertelsmann Foundation and Agfa-Gevaert. Former commissioners should not be able to move, within a few months, from representing the interests of 500 million Europeans as commissioner, to sitting on the board of private corporations or a foundation with such close links to a multinational. And MEPs should not be able to take on such second jobs alongside their parliamentary mandate.”