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Conflict of interest: A time bomb
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Conflict of interest: A time bomb ​ You can have the best lawyers. The most balance incentive a.k.a. bonuses program… ​ And still see your project collapse… ​ Take the Athens ring road extension. During procurement, it turned out that one of the “independent” advisors hired to evaluate bids had close financial ties with a consortium member. ​ A proper stake in the game. ​ When journalists started digging, the public trust tanked. Being in Greece… you know what you could expect… Drama! ​ The government had to restart discussions, renegotiate terms, and absorb years of delay. The extension—meant to decongest Athens—became a battlefield of lawsuits, arbitration threats, and political fallout. Billions in opportunity lost. All because nobody asked the brutal question early enough: ​ Forms are made to be submitted. Filled up. Reviewed. ​ Because conflicts of interest are like termites. ​ Lessons? Many for this project. But just take this one. Start by the basics. Otherwise, you’ll end up with another horror story. ​ A few more lessons… below. ​ ​100 Q&A About PPP that you MUST KNOW​ ​ PD 1: If you liked this email, don't keep it in secret and forward it to a friend. They will thank you enormously one day. PD 2: If somebody has sent you this email and you want to receive emails like this yourself, visit vicentevalencia.com PD 3: If you want unsubscribe, click the link below. ​ ​ |
Vicente Valencia
I talk about Personal Growth, Management, Infrastructure and More | C-Suite Executive | Mentor, Coach, Strategic Consultant | Real Estate Investor | 👇JOIN +2k readers 👇
Yesterday I told you about a KPI regime that seemed a horror story. Today, I bring you another that kills. Kills contract, I mean. I often tell people that vertical PPPs are not my cup of tea. Hospitals… I run away. Too complicated. Too political. Too high stakes. Take the wave of hospital PPPs in the UK during the 2000s. On paper, they looked brilliant: new facilities, modern equipment, long-term maintenance secured. But still… the KPI regime was written by bureaucrats with too much coffee...
Some PPPs die before they start.Others collapse under the weight of construction. And then there are those that rot from within — strangled by their own KPI regime. Take the Peterborough Prison PPP in the UK.On paper, it was innovative: the first privately financed prison with a focus on rehabilitation. The government loved the concept. The innocent believers in human nature wet dreamt about it. The financiers lined up.The operator thought they could make it work… if not, they would still...
Humiliation can come in many ways. But probably, one of the most humiliating failures a government can suffer in a PPP is the silence. This happened in a mid-sized developed country of the Commonwealth just a few years ago. The government wanted a flagship social infrastructure project: a cluster of new courthouses and justice facilities, spread across regional cities. They framed it as transformational. A “once in a generation” opportunity. Ministers on stage, cameras rolling, the usual...