The investigation of political and financial corruption that is unfolding in South Africa has generated a great deal of media attention. Some of this coverage touches on transactions involving our company, including the sale in early 2015 of a Bombardier Global 6000 business jet to a company associated with the Gupta family. The Guptas have come under scrutiny because of ties to Jacob Zuma, the recently resigned president of South Africa.
As a company, we welcome any honest discussion or inquiry about our South African transactions. Unfortunately, an article in the Globe & Mail on March 7 by reporter Geoffrey York instead misleads the public by omitting key facts.
The Globe’s headline warns ominously that “questions are mounting” as to whether Bombardier provided a special discount on the Global 6000 sold to the Gupta company in order to win a portion of a large South African rail contract. The answer to this question is no and the facts clearly demonstrate this. Instead of presenting a full account, however, Mr. York withheld specific information we provided to him in writing disproving the allegation; facts which could easily be corroborated had the Globe bothered to contact an aviation sales expert.
Here are those facts: the sale price of the Bombardier aircraft at issue was entirely consistent with the market at the time. Although the sale price was less than the list price – which is common in the business aircraft market, as it is in many other markets – it was actually fully in line with prices paid by other customers for similar aircraft delivered in 2015. Put simply, there was no special discount and no special treatment.
Readers would be right to wonder why this essential information was not reported. The omission certainly raises questions about the Globe’s commitment to accuracy and objectivity when reporting on our company.
The Globe’s readers would also benefit from knowing that Bombardier has a significant and longstanding diligence process to evaluate potential aircraft purchasers. This process includes checks conducted against third party databases and is designed to avoid doing business with individuals and businesses of concern. We take pride in having sold thousands of aircraft in this principled way, and also in having rejected sales that don’t meet our ethical standards.
It’s easy for any critic, with the benefit of perfect hindsight, to argue that Bombardier should not have engaged with any of the Gupta companies. But it does a disservice to our company, and to all businesses, to suggest we must compete under an absurd standard that requires we see into the future with perfect clairvoyance.
Despite reports to the contrary, the fact remains that at the time of the Global 6000 aircraft transaction, there had been no official charges, findings or any conclusion of wrongdoing regarding the Gupta companies. Export Development Canada, which financed the purchase, conducted its own independent review and came to the same conclusion as did many other leading international business institutions that continued to do business with Gupta firms for years after our sale. The Globe & Mail itself had not reported on the Gupta companies in any substantive way until well after this transaction occurred.
As a global company, we recognize that we will encounter people that don’t share our high ethical values. We see this as a challenge that can be confronted rather than a reason to retreat from global competition. We believe that people everywhere in the world deserve access to the very best aerospace and rail technology, and we'd like to supply it. We also believe that this is a goal supported by our shareholders and the Canadian public.
For its part, the press owes the public an objective, accurate and full accounting of the facts, especially when it questions the ethical integrity of a company. In this instance, the Globe fell far short of that standard and the hard working women and men of our company deserve much better.
We asked the Globe & Mail last week to print this response. So far, they have not responded to our request. We hope they have the integrity to do so and address the flaw in their coverage. Until then we will continue to set the record straight as necessary.
Vice President Communications and Public Affairs