The U.S. securities regulator has opened an investigation into Tesla Inc. over a whistleblower complaint that the company failed to properly notify its shareholders and the public of fire risks associated with solar panel system defects over several years, according to a letter from the agency.
The probe raises regulatory pressure on the world’s most valuable automaker, which already faces a federal safety probe into accidents involving its driver assistant systems. Concerns about fires from Tesla solar systems have been published previously, but this is the first report of investigation by the securities regulator.
The U.S. Securities and Exchange Commission (SEC) disclosed the Tesla probe in response to a Freedom of Information Act request by Steven Henkes, a former Tesla field quality manager, who filed a whistleblower complaint on the solar systems in 2019 and asked the agency for information about the report.
“We have confirmed with Division of Enforcement staff that the investigation from which you seek records is still active and ongoing,” the SEC said in a Sept. 24 response to Henkes, declining his request to provide its records. The SEC official said the letter should not be taken as an indication by the agency that violations of law had occurred.
Reuters was able to confirm the response.
Henkes, a former Toyota Motor quality division manager, was fired from Tesla in August 2020, and he sued Tesla, claiming the dismissal was in retaliation for raising safety concerns. Tesla did not respond to Reuters’ emailed questions, while the SEC declined to comment.
In the SEC complaint, Henkes said Tesla and SolarCity, which it acquired in 2016, did not disclose its “liability and exposure to property damage, risk of injury of users, fire etc to shareholders” prior and after the acquisition.
Tesla also failed to notify its customers that defective electrical connectors could lead to fires, according to the complaint.
Tesla told consumers that it needed to conduct maintenance on the solar panel system to avoid a failure that could shut down the system. It did not warn of fire risks, offer temporary shutdown to mitigate risk, or report the problems to regulators, Henkes said.
More than 60,000 residential customers in the U.S. and 500 government and commercial accounts were affected by the issue, according to his lawsuit filed in November last year against Tesla Energy over wrongful termination.
It is not clear how many of those remain after Tesla’s remediation program.
Safety calls ignored, whistleblower alleges
Henkes, a longtime quality manager at Toyota’s North American quality division, moved to SolarCity as a quality engineer in 2016, months before Tesla acquired SolarCity. After the acquisition, his duties changed and he became aware of the widespread problem, he told Reuters.
Henkes, in the SEC complaint, said he told Tesla management that Tesla needs to shut down the fire-prone solar systems, report to safety regulators and notify consumers. When his calls were ignored, he proceeded to file complaints with regulators.
“The top lawyer cautioned any communication of this issue to the public as a detriment to the Tesla reputation. For me this is criminal,” he said in the SEC complaint.
Litigation and concerns over faulty connectors and Tesla solar system issues stretch back several years. Walmart in a 2019 lawsuit against Tesla said the latter’s roof solar system led to seven store fires. Tesla denied the allegations and the two settled.
Business Insider reported Tesla’s program to replace defective solar panel parts in 2019.
Several residential customers or their insurers have sued Tesla and parts supplier Amphenol over fires related to their solar systems, according to documents provided by legal transparency group PlainSite.
Henkes also filed a complaint with the U.S. Consumer Product Safety Commission, which CNBC reported this year was investigating the case. CPSC and Amphenol didn’t respond to requests for comment.
Canada’s First Quantum agrees to higher payments at Panama copper mine
The Panamanian unit of Canadian miner First Quantum Minerals has agreed with Panama’s government to increase royalty payments at its flagship copper mine, the company and the government said on Monday.
Minera Panama, which is majority owned by First Quantum Minerals, has agreed to pay $375 million a year to state coffers from the Cobre Panama mine, which it says is one of world’s largest copper producers.
“We accept the proposal of the national Government, while requesting that the necessary protections be provided in order to safeguard the continuity of the operation,” Minera Panama said in a statement.
The company did not immediately respond to a question about the size of the increase in royalty payments
Panama‘s government said President Laurentino Cortizo would give details of the agreement on Tuesday.
The company began negotiating a new contract with officials in September, after Cortizo promised to seek a fairer deal with better public benefits.
Toronto-based First Quantum began commercial operations at Cobre Panama, about 120 km (75 miles) west of Panama City, in 2019.
The mine contributes 3.5% of the country’s gross domestic product, according to government figures, and at full capacity can produce more than 300,000 tonnes of copper per year.
(Reporting by Elida Moreno, writing by Daina Beth Solomon, editing by Richard Pullin)
U.N. chief urges business to help poor nations in ‘hour of need’
U.N. Secretary-General Antonio Guterres appealed to business leaders on Monday to support developing countries “in their hour of need” with access to COVID-19 vaccines, help to combat the climate crisis and reform of the global financial system.
Speaking virtually to the World Economic Forum, Guterres said: “Across all three of these areas, we need the support, the ideas, the financing and the voice of the global business community.”
He said there has been a “global inability to support developing countries in their hour of need” and warned that without immediate action inequalities and poverty would deepen, fueling more social unrest and more violence.
“We cannot afford this kind of instability,” said Guterres, who began a second five-year term as U.N. chief on Jan. 1.
He has long been pushing for more global action to address COVID-19 vaccine inequity and climate change and for reform of the global financial system.
“We need a global financial system that is fit-for-purpose. This means urgent debt restructuring and reforms of the long-term debt architecture,” Guterres said.
The World Health Organization last year set targets for 40% of people in all countries to be vaccinated against COVID-19 by the end of 2021 and 70 per cent by the middle of this year.
“We are nowhere near these targets. Vaccination rates in high-income countries are — shamefully — seven times higher than in African countries. We need vaccine equity, now,” Guterres said.
He also warned of a lopsided recovery from the pandemic with low-income countries at a huge disadvantage.
“They’re experiencing their slowest growth in a generation,” Guterres said. “The burdens of record inflation, shrinking fiscal space, high interest rates and soaring energy and food prices are hitting every corner of the world and blocking recovery — especially in low- and some middle-income countries.”
(Reporting by Michelle Nichols, Editing by Franklin Paul)
'I'm out of gas:' Leadership burnout on the rise as pandemic takes mental health toll – CTV News
Workers turn to them for support, clients rely on them for answers, companies lean on them in times of crisis.
Yet as the pandemic stretches inexorably on, experts say the never-ending demands on business leaders are pushing some to the brink of burnout.
Stress, uncertainty and long hours are causing malaise among many managers. It’s a condition that — if left unchecked long enough — can manifest as exhaustion, disengagement, depression and burnout, they say.
“Leaders are under tremendous strain,” says Paula Allen, global leader and senior vice-president of research and total well-being at LifeWorks.
“When the pandemic first started, we saw the adrenalin kick in, decisions were made fast and work got done,” she says. “But it’s been relentless. Leaders are exhausted.”
It’s not just people in charge hitting a wall 22 months, five waves and multiple variants into the COVID-19 pandemic.
New research has found an extreme level of exhaustion among many Canadian workers from the bottom to the top. Many say they’re more stressed now than during initial lockdowns.
Essential front-line workers from nurses to grocery store clerks have faced innumerable risks of infection. Others face precarious employment without sick days or benefits. Some have lost their jobs altogether and struggle to pay rent and buy food.
In comparison to these hardships, some might be quick to dismiss the challenges of leaders.
Yet many have reported an increase in exhaustion and mental health concerns since the start of the pandemic.
Supervisors, low-level managers, small business owners and senior executives are grappling with increasing demands and surging work volumes.
Many are putting in extra hours to keep things running while also providing support and encouragement to workers.
“Business leaders are supposed to be cheerleaders,” says Mike Johnston, president and CEO of Halifax software company Redspace.
“But we’ve been trying to hustle and pivot and get through this for so long now. I’m out of gas.”
For some managers, the inability to offer more certainty and support to workers is what keeps them up at night.
“When you’re the leader of a group of people you want to have all the answers,” says Barry Taylor, director of operations for The Ballroom, a large entertainment venue in downtown Toronto.
“But you don’t and you just feel helpless and burnt out.”
Experts say late-stage pandemic fatigue is taking a toll on many managers, with some veering towards burnout.
The symptoms can include emotional exhaustion, detachment, loss of motivation and reduced efficiency — all of which can have a ripple effect throughout an entire workplace, they say.
“It’s exhausted leaders leading exhausted teams,” says Jennifer Moss, a Waterloo, Ont.-based workplace consultant and author of The Burnout Epidemic: The Rise of Chronic Stress and How We Can Fix It.
“Managers are trying to be stoic and demonstrate strength and certainty for their employees when many don’t feel that themselves.”
Pandemic burnout isn’t unique to leaders, but she says there are particular stressors facing those in charge.
“It can be more isolating at the top,” Moss says. “Senior leaders and managers can sometimes feel very alone.”
There’s also a perception that because people in management positions “earn the big bucks” they should be prepared to cope with the additional responsibility and stress, she says.
“We sometimes forget there’s a human behind that role and regardless of how much they’re being paid, how much they earn, it doesn’t fix the grief and the pain and the stress that they’re dealing with,” Moss says.
The perception that managers should demonstrate unwavering leadership and steadfast support of their workers can increase fears of seeking help, experts say.
“There’s a definite stigma,” says Chantal Hervieux, associate professor of strategy at Saint Mary’s University’s Sobey School of Business and director of the school’s MBA program and Centre for Leadership Excellence.
“There’s less acceptance for leaders to talk about mental health issues.”
Leaders are expected to be in control, have the answers and be supportive of their team members, she says.
Despite the near constant uncertainty and upheaval of the pandemic, those expectations have remained the same — or increased, Hervieux says.
“Canadian business leaders are working hard to keep things going but some are suffering,” she says. “They’re paying a mental health price and we need to talk about it.”
The challenge of trying to lead during the pandemic is backed up by research.
A survey by LifeWorks and Deloitte Canada released last summer found 82 per cent of senior leaders reported feeling exhausted.
The poll found the top two stressors were an increase in work volume compared to pre-pandemic levels, and the desire to provide adequate support for the well-being of staff.
More than half of those polled said they were considering leaving their roles.
“I’ve been chatting with other CEOs and there seems to be a shift,” Johnston with Redspace says. “There’s a number of founders looking to get out, to exit. The fun of the chase isn’t balanced against the stress of it.”
Still, despite some of the unique pressures facing leaders, burnout appears to be impacting all workers.
A new Bromwich+Smith poll conducted by Angus Reid found more than 70 per cent of people surveyed are worried about their physical and mental health, including sleep issues, fear of COVID-19 and burnout.
Another study by Canada Life found a high level of burnout among Canadian workers. The survey conducted by Mental Health Research Canada found more than a third of all working Canadians are feeling burned out.
This report by The Canadian Press was first published Jan. 17, 2022.
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