In the last decade, Digicel and Cable & Wireless Communications (CWC) have generated billions of US dollars in revenue from their operations. For the year ended March 31, 2015, the two groups had revenues of US$4.6 billion with Digicel recording sales of US$2.8 billion and CWC US$1.8 billion.
While Digicel, a private company, does not disaggregate its revenue numbers by country, 87.3 per cent of its revenues come from its mobile business and 65 per cent of its mobile customers are in the Caribbean.
CWC derived 73 per cent of its revenues from the Caribbean (LIME, Bahamas and its 49 per cent stake in TSTT) in the year ending March 31, 2015.
While both companies have invested billions of US dollars in developing the telecommunications infrastructure in the Caribbean in the last decade, they have also extracted billions of dollars in profits in the form of dividends and other payments, which have flowed to the shareholders of these companies.
Neither Digicel nor CWC have very many shareholders in the Caribbean as most of Digicel is owned by Denis O’Brien, its Irish founder, and CWC is listed on the London Stock Exchange, where it is difficult, but not impossible, for Caribbean people to buy shares.
Neither Digicel nor CWC has given serious consideration to listing their companies on a regional stock exchange, so that Caribbean people can acquire shares in them, in their own currencies, and share in the wealth they generate. In fact, while Digicel is considering a small listing, some US$200 million, of the company on the New York Stock Exchange, it does not appear to have occurred to the telecommunications company, which is headquartered in Kingston, that a listing on the Jamaica or T&T stock exchanges might be appropriate.
So, like the sugar plantation owners of the past, these two companies generate a significant percentage of their profits from the Caribbean, but the profits from their operations flow to the owners of these companies, most of whom are not from the Caribbean.
One of the interesting things about the way in which both Digicel and CWC operate in the Caribbean is that while between them they employ thousands of workers throughout the region, neither company has a single director from the Caribbean on their parent company board.
According to its website, the Digicel parent board comprises the following nine directors, all but one of them being Irish: chairman Denis O’Brien and directors Colm Delves, Greg Sparks, Leslie Buckley, Lucy Gaffney, PJ Mara, Seamus Lynch, Sean Corkery and Julian Horn-Smith.
Digicel also has eight group directors, none of whom appear to have been born in the Caribbean. They are group CEO Colm Delves, group COO Andy Thorburn, group chief strategy officer Brian Finn, CEO of Digicel Play Caribbean John Suranyi, group CFO Lawrence Hickey, Asia Pacific CEO Michael Murphy, group HR director Pat Casey and general counsel Tom Reynolds.
That means that of the 16 people who direct Digicel—who strategise about where it is going to deploy its capital, how it is going to raise funds to finance its expansion and the extent to which it is going to diversify its revenue sources away from mobile voice—there are no representatives from the Caribbean sitting in decision-making positions.
There are eight members of the Digicel (T&T) Ltd board, which has three nationals of T&T on it: They are Sandra Welch-Farrell, Michael Fifi and Geoffrey Leid (and if Fifi and Leid sound familiar to you it would be in connection with their long service to the CL Financial group. I am not going there…yet.)
But the three locals are outnumbered by the five Irish directors on the local board: Colm Delves, John Delves, Denis O’Brien, Leslie Buckley and Lucy Gaffney. In other words, even in deciding the fate of Digicel in T&T, non-Trinidadian voices hold sway.
In terms of Caribbean representation on its parent board, the CWC is no better, comprising the following 11 directors—chairman Richard Lapthorne and directors Phil Bentley, Perley McBride, Simon Ball, John Risley, Mark Hamlin, Brendan Paddick, Alison Platt, Barbara Thoralfsson, Ian Tyler and Thad York—none of whom appear to have anything more than a visiting relationship with the region.
CWC, which does not have an active subsidiary in T&T, likes to boast about the fact that it has operated in the Caribbean and Latin America since the 1870’s, with a company called the West Indies and Panama Telegraph company being established in 1870.
So although it has operated for 145 years in this region, has a single Caribbean or Latin American representative ever served on the CWC (or Cable & Wireless) board?
Fourteen years after Digicel’s launch in April 2001—and although CWC has been operating in the region, in one form or another, for 145 years—there is not one Caribbean national who is knowledgeable enough about telecommunications in the Caribbean, accomplished enough in business or has done enough for Digicel or CWC’s advancement for even one person to have made it to the Digicel or CWC parent board?
This is despite the fact that both companies generate most of their revenues and profits from this region.
Why is that and what does that say about the way in which both Digicel and CWC operate and their relationship to the region where they generate most of their revenue and profits?
This is not an appeal for all multi-national companies operating in the region to place Caribbean people on their boards. Companies like BP and British Gas, which derive some of their revenues and profits from T&T, are global operations and derive a majority of their revenues and profits from outside of the region.
But a case can be made that companies like Digicel and CWC, which generate a majority of their revenues and profits from Caribbean people, should have representation of Caribbean people on their boards and should list their companies on a regional stock exchange so that Caribbean people can shares in their profits—and the losses.
One would expect that if one of this country’s major corporate players—such as the ANSA McAL group, Massy Holdings, Guardian Holdings or Republic Bank—were to develop significant sources of revenue from a foreign country, that a qualified representative from that country would eventually sit on their parent board.
One would expect that if Butch Stewart’s Sandals empire were to establish a major operation in Cuba, that a qualified Cuban executive would eventually sit on the Sandals board.
Why is it that we expect less from Digicel and CWC?