Local

Winnipeg Free Press - PRINT EDITION

Overturn award choice, business school urged

By: Geoff Kirbyson

Posted: 04/16/2009 1:00 AM | Comments: 0 (including replies)

The choice of Jim Balsillie, co-CEO of Research In Motion (RIM), as the winner of this year's International Distinguished Entrepreneur Award, is being questioned. (THE CANADIAN PRESS ARCHIVES)

A leading Winnipeg entrepreneur wants the I.H. Asper School of Business to overturn its selection for one of Manitoba's most prestigious business awards after the recipient was recently slapped with a multimillion-dollar fine by regulators.

John McFerran, president of People First HR Services and a member of the Associates, a group of local business people with strong ties to the Asper School, has expressed concerns about the choice of Jim Balsillie, co-CEO of Research In Motion (RIM), as the winner of this year's International Distinguished Entrepreneur Award.

Balsillie, whose firm produces the popular BlackBerry wireless device, has garnered most of his headlines in recent years for attempts to bring a National Hockey League team to southern Ontario. He was fined $5 million by the Ontario Securities Commission in February for backdating and repricing millions of stock options between 1998 and 2006.

McFerran's efforts have resulted in the issue being added to the agenda of the Associates' next board meeting on Friday.

"I've met with (Dean Glenn Feltham) to discuss some of my thoughts, I believe the board is considering those. I have some beliefs and feelings (on the matter). It's now in the hands of the board. Whatever the decision is, I'll abide by that," McFerran said.

Arni Thorsteinson, chairman of the IDEA selection committee, said the committee took the backdating issue into account when making its selection in January and there are no plans to rescind the award and present it to somebody else.

"Balsillie had told us about it, so we knew," Thorsteinson said. "Don't think we didn't consider it. We looked at it in the totality. These were not criminal charges, they were sanctions. He admits the actions were inappropriate and wrong and he's paid the price in terms of the settlement."

"He's going to talk about the problems (he and other executives) encountered and the price RIM paid for it (at the IDEA dinner in June). That's all part of the learning process. You can't find many entrepreneurs that haven't made mistakes and had some problems. The key is to learn from your mistakes, bounce back and carry on," he said.

Feltham agreed. He said the first criteria in evaluating potential candidates is whether they are "outstanding entrepreneurs" and have truly changed the world.

"He has really tried to change Canada's position internationally and provided huge sums of money as well as his time in advancing Canada's international position. There were sanctions taken by the OSC. We looked at this in the totality and felt comfortable this was an appropriate award to provide to (Balsillie)," he said.

Thorsteinson said RIM's BlackBerry device has revolutionized modern communication. "It's an absolutely tremendous story in technology and entrepreneurship. I was just over in the Middle East on a real estate tour and all of these people there were walking about with their BlackBerries," he said.

This isn't the first time an IDEA recipient has generated some controversy. Critics called for Martha Stewart's photo to be removed from the wall of fame in the Asper School after she was found guilty of insider stock trading in 2004 and given a short jail sentence.

geoff.kirbyson@freepress.mb.ca

What is backdating?

Options are issued to senior executives at a specified value, usually at their current market price. If an executive is given the right to purchase 1,000 shares in the company at the current price of $10 and the shares subsequently jump up in value to $25, the executive can exercise the option and pay $10,000 for shares that are worth $25,000, a gain of $15,000. But if an earlier date was chosen when the price was lower, say $6 per share, the cost would be $6,000 and the gain $19,000. In this case, the executive would have benefitted financially at the expense of shareholders.

Republished from the Winnipeg Free Press print edition April 16, 2009 B2

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010; View the changes. New to commenting? Check out our Frequently Asked Questions.

WFP Hockey

Download our new hockey app for the iPhone for Winnipeg Jets updates
Editor's Bulletin

Sign up for daily bulletins from editor Margo Goodhand
Winnipeg Jets

All things NHL on our Jets landing page
Twitter

Follow our reporters and our news feeds on Twitter
News Cafe

Check out the menu, read our blog posts or get info on coming events
Facebook Fanpage

Follow our Facebook Fanpage for story links, contests and special events