MEC faces allegations of election rigging amid annual campaign
Posted May 20, 2020 8:13 pm.
Last Updated June 13, 2020 9:33 pm.
Editor’s note: NEWS 1130’s Ash Kelly worked as frontline staff at MEC Edmonton and Vancouver stores from 2006-2013 before becoming a journalist.
VANCOUVER (NEWS 1130) — MEC’s board of directors is facing allegations of election rigging as the co-op struggles to “keep the lights on,” facing financial troubles and additional losses because of pandemic shutdowns.
With the annual election closing Thursday at noon, staff, a former director and long time members are accusing the people in charge of the Vancouver-based outdoor retailer of surreptitiously fixing elections since 2012 and say the consequences have been dire for the $500-million dollar per year business.
Responding to the allegations, MEC says 91 per cent of members voted for the resolutions that led to the controversial rule changes in 2013 and it encourages all members to vote for whomever they please.
“Our recommended candidates have financial, organizational turnaround, and strategic retail leadership experience because MEC would benefit from this type of professional background, experience and network,” the company says in an email.
Steve Grant, a former staff member and board director whose membership was purchased in the mid-1970s could not disagree more, saying “the proof is in the pudding.”
Online, dozens of members are sharing their own frustrations, thousands engaging in an online campaign against election rules allowing board recommended candidates.
“The Board of Directors has placed our co-op in the situation … where we are focusing on car culture, cheap plastic doodads, expensive brand names, and racing instead of wilderness experiences with affordable, quality gear … The Board should not be recommending candidates but should instead resign in shame of how they have failed the members,” writes member Carey Glenn.
NEWS 1130 is aware of several examples where members have expressed frustrations while casting their vote in the days leading up to the election’s end. Members say they encountered long delays and error messages while trying to vote. One says she waited more than an hour on the phone, while also waiting in queue for the online chat and did not receive a requested call back for help.
Grant says the board was more effective when composed of everyday people, not targeted professionals.
“The board is not there to run the business. The Board is there for vision and guidance. The board hires a CEO who is responsible for managing the business, and he hires a team of managers to effect that,” says Grant.
Phil Arrata was hired as MEC’s CEO to replace leader David Labistour, who resigned last year.
The former Best Buy executive’s hire was also a point of contention for the group of members keen to see the co-op return to its mandate of self-propelled wilderness activities as opposed to selling yoga, running and biking gear, coolers and car camping equipment.
Meanwhile, the co-op’s head of buying and design Jeff Crook’s profile recently disappeared from the list of executive staff members online, raising questions about his departure.
RELATED ARTICLE: MEC fighting to ‘keep the lights on’
MEC is also denying rumours that surfaced on reddit that the co-op is heading into receivership amid COVID-19 shutdowns.
“This is false information,” the co-op clarified via email this week, adding financial troubles were revealed in its 2018 annual report, before COVID-19.
Recommended candidates ‘undemocratic’
The main criticisms surround amendments made to MEC’s election rules in 2012 and 2013 allowing the Board to recommend candidates and deny others a place on the ballot if they are deemed unqualified.
The International Cooperative Alliance guidelines say qualification requirements should not be used to keep people off the ballot.
The co-op is also under fire for the way it has promoted recommended candidates above others while running an email contest critics say essentially rigged the system.
“Recommended candidates have a huge advantage by receiving the endorsement of the Board and they are also featured at the top of the election material,” writes outdoor advocate Steve Jones in a blog criticizing the practices.
No non-recommended candidate has been elected since the changes to the co-op’s democratic process came into place, says Jones, who has run unsuccessfully without an endorsement, two years in a row and is running again this year.
He is among four non-recommended candidates on the ballot in 2020, his name and face appear dead last on the materials being promoted by MEC.
MEC says the “order in which candidates appear on this website was determined through a random drawing, firstly of the recommended candidates and secondly of the candidates without recommendation, supervised by the election auditor, KPMG LLP.”
MEC Members for a Democratic Co-op
Niv Froehlich, who worked as an “MEC Advisor” at the Toronto store but quit on principal in November, is heading up a campaign encouraging members to vote for only non-recommended candidates and reject those the Board has endorsed.
Froehlich believes board members are consolidating and entrenching their positions and points out it has also become harder to propose resolutions at the annual general meeting as the board can now veto any motion put forward by a member and those resolutions now require 500 other members to sign on.
“And then to hear them say, well, this is only for your own good and has broad support is a joke, because the one thing that I’ve seen connect members across the country is the disdain for the election rigging process that we’ve been stuck with for the last few years.”
“If you’re not paying attention and you just vote blindly and trust the board, what ends up happening is you end up losing your democratic rights.”
Froehlich, Jones and others specifically criticize an emailed election contest run by the cooperative as recently as 2019, inviting people to vote for a chance to win a $250 MEC gift card. The campaign did not run in 2020.
“Sitting Directors’ have ‘sealed the deal’ ensuring that their candidates always win by running a contest,” writes member Deborah Jean.
“People just wanting to win a $250 Gift Card login to their MEC account, click on the first 3 candidates they see and they’re entered to win.”
Forelich worries thousands of members have been “lured” by the allure of a prize. With recommended candidates at the very top of the ballot, they would have another unfair advantage, he says.
Founding and early members fed up
Steve Grant says the board misrepresented the resolutions that were passed by the membership in 2012 and 2013, stripping away the democratic process under the guise of good business.
“From my perspective, the main step in doing that was the restoration of what they now call recommended candidates,” he explains.
He says the direction of the board has pushed active members away and led to financial disrepair while it promotes the election of only those it sees fit for board positions.
“The co-op was something special to people. And what they’ve managed to do is lose that, which is incredibly stupid by today’s standards, as far as how you manage your brand,” says Grant.
Founding member and member number two, Roland Burton, used his daily email newsletter to rally support for non-recommended candidates.
“Don’t know who to vote for? Easy, the existing Directors of MEC have attached the word “Recommended” to some of the candidates. Just vote for all the ones that don’t have “Recommended” after their names,” he wrote on May, 13.
Dru Jay, who started the Facebook group, MEC Members for a Democratic Co-op after failing to be elected to the Board in 2011, calls the 2012 changes to the election rules “very explicitly anti-demoratic.”
“If we can imagine Justin Trudeau’s Liberal government coming forward and saying, we’re going to put “recommended” next to certain candidates on the ballot in the next Canadian election, I think everyone would agree that that’s completely ridiculous. That’s completely anti-democratic,” says Jay.
“What we saw in 2012 and beyond was really a consolidation of power by a small clique of people who played out over the last, I guess, eight years then. I mean, to be honest, I sort of stopped paying attention because I became demoralized in 2012 and 2013.”
That level of demoralization has even hit some of the longest standing members, including Grant, who says after decades of dedication, he now chooses to shop elsewhere whenever possible.
He remembers a practice of recommending candidates that he says kept him off the Board for three years in the 1980s, pushing him to attempt reform nearly 40 years ago.
“When I first ran for the board in about ‘82 or so, there were four people running for three positions. The Board wasn’t happy with my candidacy and they recommended the other three candidates,” he says.
“I finally did get elected despite that …. and we set to work democratizing these rules and our sort of main measure was to make [Board] ‘endorsements’ prohibited,” says Grant, who says the reigniting of recommended candidates is “a joke.”
‘Vote for Jatinder’
Jatinder Heer is running for the board for the first time and is recommended by the sitting Board, he believes because of his experience as a chief financial officer.
He says he’s been surprised that some blowback has been directed at him simply because he is recommended and believes he is a great choice given the co-op’s financial struggles and the impacts of COVID-19.
“I’m a CFO with 20+ years of experience in businesses of various sizes. I honed my skills in real estate and facility management at a large, complex global organization. Real estate is MEC’s largest financial asset and we need to make sure that we properly utilize, manage and develop this asset,” he writes in his campaign material,” Heer writes on his campaign website.
Recommended candidates like Heer are arguably going to suffer from the campaign for more democratic fairness as the call is to vote only for those lacking an endorsement.
Forehlich says he’s sorry this is the case for now but he believes it’s the only way to restore power to the membership, writing “we wish you well and welcome candidates like you. However, this year we simply cannot vote for you because of the rigged election system at MEC. That’s nothing personal against you.”
Meanwhile the Vancouver District and Labour Council has made the rare move to endorse candidates Steve Jones (not recommended), Jatinder Heer (recommended) and John Yip (recommended).
Editor’s note: A previous version of this story suggested that an election-time email campaign was run by MEC in 2020. The most recent iteration of the election contest with gift cards as prizes was in 2019.