One of the major bidders for taxpayers’ money from the Department for International Development has withdrawn from the overseas aid programme following scathing criticism by MPs for “improper behaviour”.
Adam Smith International, which has links to the neo liberal Adam Smith Institute think tank, also said that three of its founding directors are to quit and its executive chairman will leave after seeing through reforms.
A report by the Commons International Development Committee highlighted in the last issue of Tribune said: “Adam Smith International has acted improperly … We are very concerned at the serious lack of judgment .. [its] actions went well beyond what was appropriate.”
William Morrison, ASI Executive Chairman, said in a statement: “The company’s mission is to foster the social and economic development of some of the poorest and often most conflict-ridden countries in the world. Our comprehensive reform emphasises the importance to our staff of this mission.”
The organisation is to reform itself as “an enterprise with primary focus on a social mission, with a mandate to consider its triple bottom line, taking into account its social, environmental and financial performance.”
It will also establish a foundation and reinvest a significant percentage of net earnings in developing countries, in part through the new foundation. In the meantime it has voluntarily quit bidding for work from DFID.
One of the resigning directors Peter Young has been with Adam Smith International and its predecessor for 24 years. It had a turnover of £130m and made a profit of £17m in 2015. The highest paid director was paid £223,000 a year and the remaining directors shared another £500,000 a year between them. Malcolm Rifkind, the former Tory foreign secretary, was a non executive director.
The company was nearly struck off the Companies House register in December – but the action was withdrawn in February.