Good morning. New details about Frank Stronach’s alleged misdeeds raise questions for Magna International – more on that below, along with Donald Trump’s ominous rhetoric and a potential super-sized Bank of Canada rate cut. But first:
Today’s headlines
- B.C. voters are sharply divided and facing a long path to determine who will form government
- A focus on feet and local needs has helped reduce amputations due to diabetes significantly, researchers say
- U.S. envoy Amos Hochstein is set to hold ceasefire talks with Lebanese officials in Beirut, sources say
Signage at Magna headquarters in Aurora, Ont.Christopher Katsarov/The Globe and Mail
Power
“He was the company”
Since industrialist Frank Stronach was charged with sex crimes this summer, Magna International, the US$43-billion auto-parts giant, has laboured for distance from its 92-year-old founder. The allegations against him “are alarming and, if proven true, completely contradict Magna’s core values and beliefs,” spokesperson Tracy Fuerst told The Globe. (Stronach has said through his lawyer that he will plead not guilty to all charges and intends to prove his innocence in court.) The company stressed that Stronach hasn’t had anything to do with its operations for more than a decade.
But as my colleagues Tavia Grant and Eric Atkins reveal in their new investigation, it’s difficult to untangle Stronach’s companies from the allegations against him – 18 crimes that include sexual assault, rape and forcible confinement – that date as far back as 1977 and as recently as February. Four women spoke with The Globe for this story. All of them described encounters with Stronach involving company resources, from corporate suites and properties to, in some cases, company staff.
Camilla Cornell is one of those women. In 1986, she became a communications co-ordinator for Stronach, then the highest-paid executive of a public company in Canada. That April, Cornell accompanied Stronach on his corporate jet to Cape Breton, where he was opening a new factory, then returned with him, on his urging, to his suite near the Metro Toronto Convention Centre before an event that night. There, she says – speaking about her experience publicly for the first time – Stronach emerged naked from the shower and walked in front of her. Cornell averted her eyes. Shortly after, en route to the event, she says he trapped her in his arms for a kiss in the elevator. Cornell tried to laugh it off.
She was 27 at the time. She didn’t speak to a manager. She didn’t report Stronach to HR. How could she complain to Magna about the man synonymous with Magna? As Cornell told The Globe: “He was the company.”
The corporate lore
A 2006 biography of Stronach, Magna Cum Laude by the late business reporter Wayne Lilley, demonstrates how well-versed staff in Europe were with Stronach’s alleged behaviour. Lilley details office Christmas parties where female employees warned their younger counterparts about the company’s founder, “to the point of describing, from experience, the ‘moves’ to expect from the boss.”
The sprawling Magna HQ.Christopher Katsarov/The Globe and Mail
Today, the board members who served at Magna during the height of Stronach’s power have very little to say about what, if anything, they knew about his conduct. The Globe made efforts to contact every living director who sat on Magna’s board between 1977, the year of the first alleged offence that led to charges, and 2011, Stronach’s final full year in the boardroom as founder and chairman. Almost none of those directors responded to repeated inquiries about oversight, accountability and company discussions.
For its part, Magna says it has launched a “targeted review of historical records” going back 40 or 50 years. Should “relevant information be located,” spokesperson Tracy Fuerst said, “we will follow a strict protocol to respect the legal rights of all and cooperate with authorities.”
A matter of record
But Jane Boon told my colleagues that any review should go well beyond “just rummaging in boxes” for past files. Boon’s own encounter with Stronach dates back four decades, when she was a 19-year-old student on a prestigious Magna scholarship. As she wrote recently in The Globe, Boon was invited by Stronach, then 54, to a shareholder afterparty held at his Toronto restaurant, Rooney’s. At the end of the night, she says, Stronach told his driver she’d had too much to drink and to retrieve her car – Stronach would take her back to his guest house in Markham himself. They had sex, and while she is not one of the complainants, Boon has said that “it certainly wasn’t right.”
She also said she hasn’t been contacted by anyone at Magna. “I’d be a pretty easy interview, if they wanted to actually talk to an employee who asserts Stronach behaved inappropriately,” Boon told The Globe. Limiting the investigation to a targeted review of historical records “seems like a pretty nifty way to give the company a clean bill of health going forward,” she added, “and use whatever report is generated to put some distance between Magna and Stronach.”
Boon believes it’s time for any reckoning of Stronach’s alleged conduct to include his corporate enablers, as well. “It’s appalling how Stronach was able to leverage corporate assets for such vile purposes, and then use his reputation as a shield.”
The Shot
‘The bigger problem is the enemy from within.’
Merch at a Trump rally in Coachella this month.Barbara Davidson/The Globe and Mail
Donald Trump’s increasingly dark rhetoric about his Democratic rivals has reignited accusations that he’s planning an authoritarian crackdown if he returns to the White House. Read more from The Globe’s Adrian Morrow here.
The Week
What we’re following
Today: New Brunswick decides its next premier in an election that will likely hinge on a handful of city ridings (looking at you, Saint John).
Tomorrow: Ottawa marks the tenth anniversary of the shooting at the National War Memorial on Parliament Hill.
Tomorrow: The BRICS summit kicks off in Kazan, Russia, where dozens of countries have applied to join the Moscow-led organization.
Wednesday: The Bank of Canada is widely expected to deliver an oversized interest rate cut, after last week’s surprisingly soft inflation report.
Wednesday: It’s opening night for the Toronto Raptors, a team trapped – according to Cathal Kelly – in a cycle of mediocrity that suits owner MLSE just fine.