On Friday afternoon an email from TICO stated CEO Richard Smart had received a letter from the Minister of Public and Business Service Delivery, Kaleed Rasheed, outlining changes to the Board of Directors. One of those directives is to decrease the Board members from 11 to 9 and to ensure that no more than 34% of Board members, “are drawn from the travel agent and travel wholesaler industry.” ACTA president Wendy Paradis issued a response to the announcement stressing the importance of a strong industry voice and making other salient points.
We should note that while the percentage of industry members is set at 34%, which would be 3 of 9 members, the Minister’s orders posted on the TICO site state that::
TICO’s Board of Directors is now accepting applications from experienced leaders within and beyond the travel industry for five positions on the board.
• Two (2) Industry Directors (who are involved in the travel industry)
• Three (3) Public Directors (who have no direct personal or business interest in the travel industry).
The TICO statement outlines the Minister’s orders which also include such curiously superfluous provisions as to, “Ensure all Board members possess a positive orientation for proactive consumer protection initiatives.”
The Minister also requires TICO to establish a nominations committee with specific eligibility criteria for nominated Board members. Click here for those important requirements.
The Minister also orders the establishment of an industry advisory council, comprised of members representing the interests of travel agents and travel wholesalers to report to and advise the Board.
These changes, said the TICO statement, will:
• Enhance consumer protection
• Enhance accountability for the sector
• Present an opportunity for TICO’s Board to lead in governance best practices, mirroring the recommendations given by the Auditor General of Ontario to other Ontario regulators
• Provide a forum for industry to identify issues and provide advice to TICO’s Board.
“While TICO’s existing Board structure has served the organization well for many years, this governance change brings added balance to the Board and reflects best-in-class governance practices,” said Smart. “This change allows for a more diverse range of voices to actively contribute to TICO’s consumer protection mandate, while still ensuring the industry has a strong voice at the table.”
ACTA speaks up
“ACTA is not surprised by the disclosure of the Ontario government orders to change the composition of the TICO board that were released by TICO last Friday night in a media release,” Paradis’s statement said.
“ACTA met with the Ontario Attorney General last spring and the Director of Consumer Policy in early July, both groups spoke about this future model for the TICO board and advised that all other Ontario regulators moved to this model after their AG audit.
“TICO went through an auditor general audit early this year so we were expecting this change.”
Regardless of the change in board composition, said the ACTA statement, “it is important that the voice of the industry is heard by TICO and the Ontario government – and to this end, there will be two industry directors on the new board and there will be an industry advisory council formed. Anyone interested in being considered for the TICO board must apply by Aug. 21, 2023.”
TICO fee structure and Comp Fund funding still unknown
ACTA, which has long been pushing for changes to fee structures and the mechanism for funding the Compensation Fund, says it is “still in the dark” about any recommendations in those areas.
Paradis’s statement reiterates, “Last month, ACTA and CATO took the unprecedented step of removing appointees from TICO board meetings until the TICO AGM in September – or, until they are given a copy of TICO’s recommendations to the Ontario government on TICO’s future fee structure and Compensation Fund funding.
“ACTA has requested an urgent meeting with Minister Rasheed, “to discuss the Ontario Consumer Compensation Fund funding model before TICO’s consultation with registrants and stakeholders takes place this Fall.
“The Ontario government continuously ‘says’ it is committed to red tape reduction – a reduction in administrative and financial burden on Ontario business. They say…Ontario is ‘open for business.’
“The message that ACTA has delivered to government is clear. The industry cannot and should not be bogged down by unnecessary administrative burden to run a travel business in Ontario. The industry cannot and should not be required to financially support an ever-expanding regulator with increased unnecessary legislation and fees.
“Our message has been consistent. If the Ontario government is committed to a Traveller Consumer Compensation Fund in Ontario to cover potential bankruptcies, the current compensation should be fixed, including…that the beneficiary of the fund – the travel consumer – should be the contributor to that Fund as is the model in Quebec.
“The industry is recovering from a catastrophic global pandemic and should not and cannot support unnecessary administrative and financial burden.”
Similar changes
The TICO statement points out that similar governance changes have been implemented at other Delegated Administrative Authorities, including the Ontario Motor Vehicle Industry Council (OMVIC), Home Construction Regulatory Authority (HCRA) and Tarion.
It continues, “These orders reflect a modernized approach to board governance, which includes skills-based recruitment to ensure optimal expertise in board oversight. The Board of Directors is responsible for providing ongoing strategic oversight and governance to TICO as it fulfills its mandate of consumer protection.”
TICO says it is making the necessary by-law changes to implement these orders, which will be presented at TICO’s Annual General Meeting, scheduled virtually for Tuesday, Sept. 26, 2023 at 5 p.m.”
More to come…
TICO will host a webinar in the coming month to provide more information about how the Minister’s Orders will be implemented and provide an opportunity for registrants and stakeholders to ask questions.
Read the Minister’s Orders posted on TICO