ASI executives step down following controversy

2 Mar 17

Accusations of misconduct have prompted the entire top management of private sector aid firm Adam Smith International (ASI) to resign.

The four founding executives of ASI, including Peter Young who was implicated in the recent scandal at one of the biggest recipients of the UK aid budget, are to step down as part of a major restructuring intended to clean up the firm’s image.

Aid campaigners were already critical of UK aid’s partnership with ASI before allegations emerged that the company had faked glowing testimonials from its overseas beneficiaries, which were submitted as evidence to a parliamentary watchdog’s inquiry.

The watchdog later found that the firm had “acted improperly” and raised “serious concerns” about its efforts to manipulate the evidence and the culture within the organisation, which has received hundreds of millions of pounds in British aid money.

In response to the watchdog’s calls for change, ASI said it was undergoing a “major reform”, restructuring its senior team and focusing the firm’s work on social impact.

Three of the firm’s founding executives – Andrew Kuhn, Amitabh Shrivastava and Peter Young – will step down.

Young was the only executive widely implicated in the manipulation of testimony. Leaked emails showed him warning the staff working on the testimonials not to pretend to be “illiterate farmers” writing in “perfect English”, and stressed care should be taken to ensure ASI employees were not identified as the creators of the documents.

The parliamentary watchdog that investigated the allegations, and that the testimonies were originally submitted to, noted that ASI had removed incriminating metadata from the documents and had likely done so to distance the organisation from their creation.

A fourth founding executive and ASI’s executive chairman, William Morrison, will step down after leading ASI through the restructuring process.

Morrison stressed that the result of the reform will be to emphasise the importance of the company’s mission – to foster social and economic development in some of the poorest and most conflict-ridden countries in the world.

“We seek to ensure the highest standards of corporate governance, a fit-for-purpose structure and culture, and accountability to our clients, including significantly the UK government, and to the beneficiaries of our work,” he stated.

The changes will include: appointing a non-executive chairman and non-executive directors; shifting the organisation’s primary focus to social impact, with a “triple bottom line” taking into account social, environmental and financial performance; reinvesting a “significant percentage” of ASI’s net earnings into developing countries, in part through a newly established foundation; and establishing a 38-point reform plan looking at policies, procedures and standards.

The reform plan is already in the process of being completed and will be finished by the end of this month, the firm said. Until then, it has withdrawn from the UK’s Department for International Development’s procurement.

“We regret that certain deficiencies of policy and procedure resulted in our failure to meet the highest standards of corporate governance, such that we did not meet the expectations of DFID and the public, to whom we are accountable,” said Morrison.

“The changes we are making will address the requirement to now meet these expectations.”

But Aisha Dodwell, an aid campaigner at Global Justice Now – a staunch critic of ASI’s practices – said the reforms amounted to little more than “shuffling the deck chairs”.

“The recent review into the company should be a wake-up call to DFID to stop spending important aid money on expensive UK-based consultants, and start using it to help developing countries build appropriate public services,” she said. 

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