Sepa Is environmental regulation in Scotland failing?

Revealed: the Sepa board member with ties to Norwegian oil

A long-serving member of the board of Scotland’s environment watchdog is also a director at a North Sea oil drilling firm, The Ferret has found.

Nicola Gordon became a member of the Scottish Environment Protection Agency’s (Sepa) board in 2018 and is chair of the regulator’s audit and risk committee.

Sepa is the Scottish Government body tasked with protecting the health of Scotland’s environment and implementing laws to reduce climate pollution from businesses and industry.

But despite this remit, while at Sepa Gordon has been on the board of Norwegian firm Okea ASA since 2019. Okea extracts thousands of barrels of oil from the Norwegian section of the North Sea every day. The production and burning of oil and gas, which are fossil fuels, is one of the leading causes of climate change.

As recently as 2022, Gordon was reportedly “spearheading” the development of one of Okea’s oil fields. Okea has paid Gordon over £20,000 since she joined the board in 2019 to the end of 2022. She also held shares in the business at that time.

Regulatory experts and campaigners told The Ferret Gordon’s role at Okea was a “conflict of interest” and claimed it was evidence of a “revolving door” between industry and Sepa. “Putting poachers into gamekeeping roles in a climate crisis is unacceptable,” one claimed.

But Sepa’s chairman said the agency draws its board from a “cross-section of Scottish society” including those with “significant experience and insight” in the private sector. He pointed out that Gordon had declared her directorship and remuneration by Okea in a publicly available register of interests.  

Putting poachers into gamekeeping roles in a climate crisis is unacceptable.

Andrew Watterson, University of Stirling

Sepa’s board is responsible for its “overall direction and performance” including its “efficiency and effectiveness as a public body”. Board members are appointed by the Scottish Government. 

Before joining Sepa and Okea, Nicola Gordon had a long career in fossil fuels and worked for the oil giant Shell for over 30 years including in senior roles. 

She previously held shares in Shell while serving at Sepa but there is no mention of these in her most recent register of interests, which is available on the watchdog’s website, suggesting they may have been sold. 

Gordon has also been on the board of the Scottish Energy Forum (SEF) since 2015, and was the body’s president between 2019 and 2021. SEF was known as the Scottish Oil Club until 2019, and its members include a host of fossil fuel companies.  

A 2022 interview with Gordon in Thailand’s Bangkok Postentitled ‘How to get ahead in oil and gas’ – noted that she is behind the “successful operation” of Okea’s Draugen oil field off the Norwegian coast. Thai firm Bangchak Corporation is the largest shareholder in Okea.

Okea owns stakes in 41 oil and gas licences and produced the equivalent of nearly 24,000 barrels of oil every day in the third quarter of 2023.

Andrew Watterson of the University of Stirling, an expert in environmental regulation, told The Ferret that regulators should be ensuring board members have “no perceived or real conflicts of interests”.

“It will therefore be a shock to many to find out this has not been the case at Sepa for at least the last five years and revolving doors between industry and regulator continue,” Watterson said. “Putting poachers into gamekeeping roles in a climate crisis is unacceptable,” he added. 

Watterson also said that an “additional cause for concern” is the fact that Scotland is the site of Shell’s Mossmorran natural gas liquids plant in Fife. 

shell
Before joining Sepa and Okea, Gordon had a long career in fossil fuels and worked for the oil giant Shell for over 30 years. Image: Keming Tan

Gas flaring at the Mossmorran site, which processes gas from under the North Sea, has caused environmental and health concerns for years. Sepa is responsible for ensuring that processes at Mossmorran are not breaching pollution rules.

Watterson claimed: “To find the Sepa board contains a former Shell senior manager who had been in the company for much of the time of Mossmorran’s operation is very surprising.”

The Ferret’s findings about Gordon and Okea are not the first time that members of Sepa’s board’s external business interests have been criticised.

In a 2020 blog, the former SNP MP, George Kerevan, claimed Sepa had been “captured by corporate interests”.

Between 2014 and 2021, Sepa’s board also included a former head of corporate development at Weir Group, a Glasgow-headquartered multinational which produces engineering equipment for mining. Until 2020, Weir was a major producer of equipment for use in fracking, a controversial process used to access underground gas reserves.

That board member held shares in Weir Group while serving on the board of Sepa.

Sepa is not the only body responsible for Scotland’s environment which has faced criticism of board appointments in recent months. 

Revealed: the Sepa board member with ties to Norwegian oil 5

In December, The Ferret reported that the new chair of Scottish Water – who will be paid over £100,000 a year to work two days a week in the role – was formerly a top lobbyist for the North Sea oil industry.

Critics questioned whether the new chair, Deirdre Michie, was the wrong person to be taking the role at Scottish Water which faces an “uphill battle to reduce” sewage and climate pollution. However Scottish Water said it needed a chair with “experience and skills found in large, complex and vitally important business organisations”. 

Professor Campbell Gemmell, who was Sepa’s chief executive between 2003 and 2012, said a review of the governance of Scotland’s environmental bodies is “urgently needed”.

He claimed that “a close knowledge and working relationship with industry” was important for Sepa. But bringing “polluters” on to boards was a “high risk strategy”. 

“If it is to happen at all, then it is crucial that interests are declared and managed by board processes, active roles in polluters are suspended and the actions of such board members are carefully monitored and reported,” Gemmell told The Ferret. 

Gemmell also questioned the Scottish Government’s selection process for the Sepa board, noting that it was “interesting that highly qualified environment specialists have been unable to join the agency board but polluters have”.

Meanwhile, Friends of the Earth Scotland’s climate campaigner, Caroline Rance, called The Ferret’s findings about Sepa’s board “shocking”.

Rance claimed: “At the heart of any oil firm’s business plan is a denial of climate science and a willingness to put private profit above our collective safety and environmental protection. 

“These are not the characteristics of people that we need overseeing Scotland’s key environmental regulator.”

At the heart of any oil firm’s business plan is a denial of climate science and a willingness to put private profit above our collective safety and environmental protection. 

Caroline Rance, Friends of the Earth Scotland

Sepa’s interim chairman, Dr Harpreet Kohli, said: “Since our inception 27 years ago, the board of Scotland’s environment protection agency has provided strong governance and strategic oversight, drawing from a diverse cross-section of Scottish society. This includes significant experience and insight from public, private, third sectors and environmental NGOs”. 

“Our board members adhere to an established code of conduct and maintain publicly available registers of interest”, he said. “Ms Gordon has declared a directorship of and remuneration from Okea AS.”

A Scottish Government spokesperson said all Sepa board members had “an individual duty to be responsible for identifying, and taking advice on, any conflicts of interest”. 

A spokesperson added: “All individuals who apply for a regulated public appointment are bound by the Ethical Standards in Public Life (Scotland) Act 2000 which includes responsibilities regarding declarations of interest.”

The effectiveness of Sepa’s enforcement of environmental laws was called into question last year when The Ferret revealed that its legal actions against polluters had fallen sharply in the preceding five years. 

Campaigners claimed at that time that the decrease in enforcement was a sign the agency was turning a “blind eye” to pollution.

Sepa has experienced a turbulent few years. It was targeted by a criminal cyber attack in December 2020 which cost the body millions of pounds to recover from. Information on thousands of environmental checks was lost as a result of the hack.

Then, in January 2022, the body’s chief executive Terry A’Hearn stepped down due to “accusations over his conduct”. Responses to an internal survey of staff, conducted after A’Hearn’s departure, claimed a bullying, “male dominated culture” existed at the regulator. 

Like other green agencies, Sepa has seen its funding slashed in real terms by the government in recent years, prompting claims it is not a “priority” for the Scottish Government.

Okea has been asked to comment.

This Ferret story was also published in the Sunday National. Our partnerships with other media help us reach new audiences and become more sustainable as a media co-op.  Join us to read all our stories and tell us what we should investigate next.

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