• 19 Aug 2015 9:53 AM | GPC Webmaster (Administrator)

    The Globe and Mail Inc

    An architect of one of the biggest corporate frauds in history offered a blunt mea culpa and dished out advice to Canadian governance experts on Tuesday, urging company boards to make decisions as though the business was family owned.

    Andrew Fastow, the former chief financial officer of Enron Corp., admitted to the Canadian Society of Corporate Secretaries that he was “always a little surprised” to be invited to speak about ethics to business groups.

    http://www.theglobeandmail.com/report-on-business/international-business/us-business/former-enron-cfo-speaks-of-convictions-offers-business-advice/article26009702/ 


  • 17 Aug 2015 3:07 PM | GPC Webmaster (Administrator)

    MONTRÉAL, Aug. 17, 2015 - The Canadian Society of Corporate Secretaries ("CSCS") handed out the third annual Excellence in Governance Awards/Prix d'excellence en gouvernance at the opening gala of the CSCS' 17th Annual Corporate Governance Conference held at the Queen Elizabeth Hotel in Montréal, Québec, on August 16, 2015.
    The following winners were selected in these categories:

    • Best sustainability, ethics and environmental governance program:
      • Large-cap winner: Cameco Corporation
      • Mid-cap winner: Tahoe Resources
      • Honorable mention: Greater Toronto Airports Authority
    • Best use of technology in governance, risk and compliance – Royal Bank of Canada
    • Best approach to board and committee support:
      • Winner: First West Credit Union
      • Honorable Mention: University of Calgary
    • Best stakeholder engagement by a governance team – Canadian Blood Services
    • Best practices to enhance boardroom diversity:
      • Winner: HSBC Bank Canada
      • Honorable Mention: Greater Toronto Airports Authority
    • Best practices in strategic planning, oversight and value creation by the board – ATB Financial
    • Best overall corporate governance – Royal Bank of Canada
    • CSCS Joyce Borden-Reed distinguished contribution award – Glenn G. Keeling
    • CSCS Peter Dey governance achievement award – David R. Beatty, Conway Chair, Clarkson Centre for Board Effectiveness, Rotman School of Management.

    The CSCS EG Awards recognize the important contribution governance professionals make in terms of best practices that build and sustain shareholder and stakeholder value. The awards underscore the critical role that good governance plays in sustaining the value of Canada's public companies, crown corporations, government agencies, and not-for-profit organizations, contributing to the competitiveness of Canada's economy and its capital markets.

    The final award winners were selected by a jury panel composed of seasoned and well-respected governance experts from across Canada and include: 

    Geoffrey D. Creighton, President, In-House Counsel Worldwide
    Gigi Dawe, Principal, Research Guidance and Support Leader, Corporate Oversight and Governance, Chartered Professional Accountants of Canada
    Sylvia Groves, President and Creative Director, Governance Studio
    Dr. Richard Leblanc, Associate Professor, Law, Governance and Ethics, Faculty of Liberal Arts and Professional Studies, York University
    Carrie Mandel, Partner, Legal, Compliance and Regulatory Practice, Spencer Stuart
    Paul Schneider, Head of Corporate Governance, Public Equities, Ontario Teachers' Pension Plan
    Elizabeth Watson, QC, Founder and President, Watson Inc.
    Brendan Sheehan, Managing Director, Corporate Governance, Rivel Research Group
    Honorary judge, Peter Dey, Chairman, Paradigm Capital Inc.

  • 17 Aug 2015 11:06 AM | GPC Webmaster (Administrator)

    The Canadian Society of Corporate Secretaries (CSCS) is pleased to announce that, at its annual meeting earlier today, five new directors were elected to its board of directors. With the board being represented by top corporate secretaries and governance professionals, the addition of these new members rounds CSCS’ expertise and national representation. New directors include:

    • Carmel Bellamy, Associate Secretary and Sr. Director, Corporate Governance & Co-operative Relations, The Co-operators Group Limited, Guelph ON
    • Brigitte Catellier, Corporate Secretary and Head of Governance, HSBC Bank Canada, Vancouver BC
    • Alain Dussault, Lawyer, CN Rail, Montreal QC
    • Glenn Keeling, Independent Director, Cobourg ON
    • Sally Maziarz, Assistant Corporate Secretary, EPCOR Utilities Inc., Edmonton AB

    As the organization continues with implementation of its Strategic Plan, the new directors compliment the strong suite of directors currently servicing the board. Continuing directors, re-elected at the annual meeting, include:

    • Mary Batoff, General Counsel and Corporate Secretary, Torex Gold Resources Inc., Toronto ON 
    • Madeleine Bertrand, Director, Corporate  Affairs & ATIP Coordinator, Royal Canadian Mint, Ottawa ON
    • Misti Christensen, Manager, Governance and Assistant Secretary, Nexen Energy ULC, Calgary AB
    • Meg Comiskey, Manager, Policy and Research and Assistant Corporate Secretary, Vancouver Airport Authority, Richmond BC
    • David Masse, Independent Director, Beaconsfild QC
    • Janis McKenzie, Independent Director, Brampton ON

    Board member bios are available on the CSCS website at http://www.cscs.org

    Chairman of the Board, David Masse, paid special thanks to the outgoing directors, Laurel Savoy, who joined the Board in 2002 and Leah Fitzgerald, who joined the board in 2010. Their valued contributions to the organization have been greatly appreciated.


  • 22 Jul 2015 11:04 AM | GPC Webmaster (Administrator)

    NOTICE IS HEREBY GIVEN THAT an annual meeting (“Meeting”) of members of the Canadian Society of Corporate Secretaries (CSCS) will be held at The Fairmont Queen Elizabeth Hotel, 900 René Lévesque Blvd. West, Montreal, Quebec on Monday, August 17, 2015 at 8:30 a.m. EDT. to conduct the following business:

    1. Receive the report of the Board of Directors;
    2. Receive the 2014-15 annual audited financial statements and the report of the Public Accountant;

    3. Appoint the Public Accountant for CSCS for the 2015-16 financial year and authorize the directors to fix the remuneration;

    4. Elect the Board of Directors of CSCS for a term ending at the close of the next Meeting; and

    5. Transact further and other business as may properly be brought before the Meeting.

    The documents that relate to this meeting are now available in the "members only" area of the website by clicking here.

    CSCS has retained D.F. King Canada as our Proxy Solicitation Agent and CST Trust Company as our Tabulator and Scrutineer. Any questions and requests for assistance may be directed to D.F. King Canada by calling:

    North American Toll Free Phone: 1-800-301-9629
    Outside North America, call collect: 201-806-7301

     

    Sincerely,

    Madeleine Bertrand
    Board Secretary

  • 18 Jun 2015 12:09 PM | GPC Webmaster (Administrator)

    The Canadian Society of Corporate Secretaries ("CSCS") is pleased to announce the shortlist for the 2015 Excellence in Governance Awards/Prix d'excellence en gouvernance (EGs). We received over 80 nominations this year from organizations across all sectors and the shortlisted nominees, organized by category, are presented below:

    1. Best sustainability, ethics and environmental governance program
      • BCE Inc.
      • Cameco Corporation
      • Greater Toronto Airports Authority
      • Royal Bank of Canada
      • Tahoe Resources Inc.
    2. Best use of technology in governance, risk and compliance
      • Mitel Networks Corporation
      • Royal Bank of Canada
      • Saskatchewan Research Council
    3. Best approach to board and committee support
      • First West Credit Union
      • Royal Bank of Canada
      • The Co-operators
      • University of Calgary
    4. Best stakeholder engagement by a governance team
      • Canadian Blood Services
      • Royal Bank of Canada
      • TD Bank Group
      • WestJet Airlines Ltd.
    5. Best practices to enhance boardroom diversity
      • Canada Council for the Arts
      • Greater Toronto Airports Authority
      • HSBC Bank Canada
      • MTS Allstream
      • Royal Bank of Canada
      • Telus
    6. Best practices in strategic planning, oversight and value creation by the board
      • Associated Engineering Group Ltd.
      • ATB Financial
      • CBC Pension Plan
      • Royal Bank of Canada
    7. Best overall corporate governance
      • Bank of Montreal
      • CN
      • Goldcorp Inc.
      • Royal Bank of Canada

    We thank the following individuals who volunteered a considerable amount of time and effort in reviewing all of the submissions for the shortlist: Wendy King, Vice President, Legal, Risk & Governance, Capstone Mining Corp.; Jamie Patterson, Corporate Counsel, Group Medical Services; Brendan Sheehan, Founder and President, The Illawong Group, Christine Staley, Director of Professional Development, Canadian Corporate Counsel Association; Sheldon Stener, General Counsel and Corporate Secretary, Federated Co-operatives Limited; Terri Uhrich, Vice President, Legal Affairs, K+S Potash Canada.

    The Excellence in Governance Awards final jury panel is composed of seasoned and well-respected governance experts from across Canada and include:

    1. Geoffrey D. Creighton, President, In-house Counsel Worldwide
    2. Gigi Dawe, Principal, Research Guidance and Support Leader, Corporate Oversight and Governance, CPA Canada
    3. Sylvia Groves, President and Creative Director, Governance Studio
    4. Richard Leblanc, Associate Professor, Law, Governance & Ethics, Faculty of Liberal Arts and Professional Studies, York University
    5. Carrie Mandel, Lawyer and Consultant, North American Legal, Compliance and Regulatory Practice, Spencer Stuart
    6. Paul Schneider, Manager, Corporate Governance, Ontario Teachers' Pension Plan (OTPP)
    7. Elizabeth Watson, QC, Founder and President, Watson Inc.

    The final award winners will be announced and celebrated on August 16, 2015 in Montreal, Quebec at the CSCS' 17th Annual Conference.

  • 25 Aug 2014 11:00 AM | GPC Webmaster (Administrator)

    BANFF, August 24, 2014 - The Canadian Society of Corporate Secretaries ("CSCS") is pleased to announce the winners of the second annual Excellence in Governance Awards/Prix d'excellence en gouvernance (EGs).

    The winners were announced at the opening gala of the CSCS’ 16th Annual Corporate Governance Conference held in Banff, Alberta, on August 24, 2014.

    The following winners were selected in these categories

    • ATB Financial – Best  sustainability, ethics and environmental governance program
    • Royal Bank of Canada – Best use of technology in governance, risk and compliance
    • ATB Financial – Best approach to board and committee support
    • Bombardier Inc – Best stakeholder engagement by a governance team
    • Hamilton Community Foundation – Best practices to enhance boardroom diversity
    • Royal Bank of Canada – Best practices in strategic planning, oversight and value creation by the board
    • BC Cancer Foundation and MTS Allstream – Best overall corporate governance
    • Sylvia Groves, Governance Studio – CSCS - Joyce Borden-Reed distinguished contribution award
    • Stephen Jarislowsky and Claude Lamoureux (Co-Founders of the Canadian Coalition for Good Governance) – Peter Dey governance achievement award

    CSCS would like to acknowledge the contribution of the Canadian Corporate Counsel Association (CCCA) to the shortlisting process and specifically the following judges: Cathy Cummings, Executive Director, Canadian Corporate Counsel Association, Wendy King, Vice President, Legal, Risk and Governance, Capstone Mining Corp, Jamie Patterson, Corporate Counsel, Group Medical Services, Sheldon Stener, General Counsel and Corporate Secretary, Federated Co-operatives Limited andTerri Uhrich, Vice President, Legal Affairs, K+S Potash Canada.

    The final award winners were selected by a jury panel composed of seasoned and well-respected governance experts from across Canada and include:

    Geoffrey D. Creighton, Senior Vice-President, General Counsel and Secretary and Chief Compliance Officer, IGM Financial Inc.
    Gigi Dawe, Principal, Research Guidance and Support Leader, Corporate Oversight and Governance, Chartered Professional Accountants of Canada
    Stephen Griggs, CEO, Smoothwater Capital Corporation
    Sylvia Groves, President and Creative Director, Governance Studio
    Richard Leblanc, Associate Professor, Law, Governance & Ethics, Faculty of Liberal Arts and Professional Studies, York University
    Andrew MacDougall, President, Spencer Stuart Canada
    Paul Schneider
    , Manager, Corporate Governance, Ontario Teachers' Pension Plan (OTPP)
    Elizabeth Watson, QC, Founder and President, Watson Inc.
    Judging facilitator Brendan Sheehan, Founder and President, The Illawong Group and honorary judge, Peter Dey, Chairman, Paradigm Capital.

    The Canadian Society of Corporate Secretaries is recognized as the most important organization for corporate governance professionals in Canada. CSCS strives to enhance the public's awareness of the importance of good governance and to be the voice of corporate governance professionals in Canada. The organization participates with other stakeholders, including capital markets participants, government bodies and regulators, in fostering a governance environment that sets Canada apart in the world. CSCS also supports its membership with continuing education and networking opportunities.

    SOURCE: Canadian Society of Corporate Secretaries

    For further information:

    Lynn Beauregard, President
    255-55 St. Clair Avenue West
    Phone: 416-921-5449 / 1-800-774-2850
    Email: egawards@cscs.org
    Website: http://www.cscs.org/EGA
  • 26 May 2014 12:06 PM | GPC Webmaster (Administrator)

    TORONTO, May 26, 2014 - The Canadian Society of Corporate Secretaries ("CSCS") is pleased to announce the shortlist for the second annual Excellence in Governance Awards/Prix d'excellence en gouvernance (EGs).

    Around 60 nominations were received this year from organizations across all sectors and the shortlisted nominees, organized by category, are presented below:

    Best sustainability, ethics and environmental governance program

    • ATB Financial
    • Bombardier Inc
    • BMO Financial Group
    • Hydro Ottawa
    • GOLDCORP

    Best use of technology in governance, risk and compliance

    • Bombardier Inc
    • Royal Bank of Canada

    Best approach to board and committee support

    • Sun Life Financial
    • First West Credit Union
    • ATB Financial
    • Central West Community Care Access Centre

    Best stakeholder engagement by a governance team

    • Royal Bank of Canada
    • Bombardier Inc
    • BMO Financial Group
    • Veridian Connections Inc.
    • Sun Life Financial

    Best practices to enhance boardroom diversity

    • Royal Bank of Canada
    • HAMILTON COMMUNITY FOUNDATION
    • Canada Council for the Arts
    • Manitoba Telecom Services Inc. MTS Allstream

    Best practices in strategic planning, oversight and value creation by the board

    • Certified Management Accountants of Ontario (CMA Ontario)
    • ATB Financial
    • Deloitte LP
    • Royal Bank of Canada

    Best overall corporate governance

    • Royal Bank of Canada
    • TransCanada Corporation
    • BC Cancer Foundation
    • Encana Corporation
    • Manitoba Telecom Services Inc. MTS Allstream
    • Tim Hortons Inc.

    CSCS would like to acknowledge the contribution of the Canadian Corporate Counsel Association (CCCA) to the shortlisting judging. We thank the following individuals who volunteered a considerable amount of time and effort in reviewing the submissions: Cathy Cummings, Executive Director, Canadian Corporate Counsel Association, Wendy King, Vice President Legal, Risk & Governance CAPSTONE MINING CORP., Jamie Patterson, Corporate Counsel, Group Medical Services, Sheldon Stener, General Counsel and Corporate Secretary, Federated Co-operatives Limited, Terri Uhrich, Vice President, Legal Affairs, K+S Potash Canada and judging facilitator Brendan Sheehan, Founder and President, The Illawong Group.

    The final award winners will be announced and celebrated on August 24, 2014 in Banff, Alberta at the CSCS' 16th Annual Conference.

    The Excellence in Governance Awards jury panel is composed of seasoned and well-respected governance experts from across Canada and include: 

    Geoffrey D. Creighton, Senior Vice-President, General Counsel and Secretary and Chief Compliance Officer, IGM Financial Inc.
    Gigi Dawe, Principal, Risk Oversight and Governance, National Practice Leader, Governance Strategy and Risk, CICA
    Stephen Griggs, CEO, Smoothwater Capital Corporation
    Sylvia Groves, President and Creative Director, Governance Studio
    Carol Hansell, Founding Partner, Hansell LLP
    Richard Leblanc, Associate Professor, Law, Governance & Ethics, Faculty of Liberal Arts and Professional Studies, York University
    Andrew MacDougall, President, Spencer Stuart Canada
    Paul Schneider
    , Manager, Corporate Governance, Ontario Teachers' Pension Plan (OTPP)
    Elizabeth Watson, QC, Founder and President, Watson Inc.

    The Canadian Society of Corporate Secretaries is recognized as the most important organization for corporate governance professionals in Canada.

    As the principal advocate for those who work in corporate governance, CSCS strives to enhance the public's awareness of the importance of good governance. CSCS is the voice of corporate governance professionals in Canada and participates with other stakeholders, including capital markets participants, government bodies and regulators, in fostering a governance environment that sets Canada apart in the world. CSCS supports its membership with continuing education and networking opportunities that are second to none.

    For further information:
    Lynn Beauregard, President
    255-55 St. Clair Avenue West
    Phone: 416-921-5449 / 1-800-774-2850, Ext 306
    Email: lynn.beauregard@cscs.org
    Website: http://www.cscs.org/EGA

  • 09 Jan 2014 10:49 AM | GPC Webmaster (Administrator)

    TORONTO, Jan. 8, 2014 - The Canadian Society of Corporate Secretaries ("CSCS") announces that the nominations are now open for the second annual Excellence in Governance Awards/Prix d'excellence en gouvernance (EGs). The highly respected jury will select the winners for the awards which will be announced and celebrated on August 24, 2014 in Banff, Alberta at the CSCS' 16th Annual Conference.

    The CSCS EG Awards recognize the important contribution that governance professionals make in terms of best practices that build and sustain shareholder and stakeholder value in Canada. The awards also underscore the critical role that good governance plays in sustaining the value of Canada's public companies, crown corporations, government agencies, and not-for-profit organizations, and in contributing to the competitiveness of Canada's economy and its capital markets.

    The Excellence in Governance Awards jury panel is composed of seasoned and well-respected governance thought leaders from across Canada. CSCS has carefully selected the judges to ensure representation from all aspects of the governance community including shareholder representatives, regulatory experts, leading academics and practitioners.

    Candidates eligible for nomination include individuals and/or teams of individuals who play a role in the governance of their organizations. The deadline for nominations is April 8, 2014, and the shortlist of finalists for the awards will be announced in June 2014. For more information on the nomination process click here.

    CSCS will seek nominations in the following award categories:

    • Best sustainability, ethics and environmental governance program
    • Best use of technology in governance, risk and compliance
    • Best approach to board and committee support
    • Best stakeholder engagement by a governance team
    • Best practices in managing boardroom diversity
    • Best practices in strategic planning, oversight and value creation by the board
    • Best overall corporate governance
    • Joyce Borden-Reed CSCS distinguished contribution award
    • CSCS (Peter Dey) Governance Achievement Award
    CSCS expects that the recognition that the winners, nominees and their organizations will gain from these awards will raise more awareness for the key role played by governance professionals, further the reputation of their organizations, and inspire others to follow their example.
  • 13 Nov 2013 1:49 PM | GPC Webmaster (Administrator)

    November 11, 

    Delivered by email

    British Columbia Securities Commission
    Alberta Securities Commission
    Saskatchewan Financial and Consumer Affairs Authority
    Manitoba Securities Commission
    Ontario Securities Commission
    Autorité des marchés financiers
    New Brunswick Financial and Consumer Services Commission
    Superintendent of Securities, Prince Edward Island
    Nova Scotia Securities Commission
    Securities Commission of Newfoundland and Labrador
    Superintendent of Securities, Yukon Territory
    Superintendent of Securities, Northwest Territories
    Superintendent of Securities, Nunavut

    The Secretary
    Ontario Securities Commission
    20 Queen Street West
    19th Floor, Box 55
    Toronto, Ontario M5H 3S8
    Email: comments@osc.gov.on.ca

    Anne-Marie Beaudoin
    Corporate Secretary
    Autorité des marchés financiers
    800, square Victoria
    C.P. 246, 22e étage
    Montréal, Québec H4Z 1G3
    E-mail: consultation-en-cours@lautorite.qc.ca

    Re : Response to the request for comments CSA Consultation Paper 54-401 Review of the Proxy Voting Infrastructure

    We preface this response by expressing our appreciation to the Canadian Securities Administrators (CSA) for their continuing efforts to address the serious concerns related to shareholder voting processes.
    The Canadian Society of Corporate Secretaries (CSCS) is a national association representing corporate secretaries and governance professionals.

    The movement to give shareholders a stronger voice in the way Canada’s public companies are governed is a positive trend that benefits both investors and issuers.  The question is not whether shareholders ought to have a voice, but rather whether that voice is being heard properly, and whether shareholder votes are being counted properly.

    CSCS believes simply that shareholder votes must be counted with the same degree of care and integrity that applies to ownership and dividend rights.  We also believe that all shareholders, registered and beneficial alike, deserve equal rights.

    Unfortunately, the current system of shareholder voting falls far short of respecting these basic principles.

    CSCS has devoted considerable time and resources to promote a fundamental reform of the rules for shareholder voting:

    • In 2005 we conducted a series of forums in collaboration with the CSA in Montreal, Toronto, Calgary and Vancouver to discuss the functioning of National Instrument 54-101 on communications with beneficial shareholders.
    • In 2007 we participated in a stakeholders’ panel on shareholder voting at the annual conference of the Canadian Investor Relations Institute.
    • We published a white paper in 2008 promoting changes to the corporation statutes to provide equal treatment for registered and beneficial shareholders.
    • In 2010 we extensively reviewed and provided comments to assist in the preparation of the Davies paper on the Quality of the Shareholder Vote in Canada.
    • We convened the 2011 Shareholder Democracy Summit and published an inaugural report with the Summit's findings.
    • In 2012, following up on the Summit, we proposed to key stakeholders a Facilitation Program with a five year roadmap and milestones that would clear the path for reform.
    • In the latest step in our campaign for reform we conducted a series of public forums along with the CSA.  We held open meetings this October in Montreal, Toronto, Calgary and Vancouver in collaboration with the CSA.

    Progress made to date, in spite of these efforts, has been painfully slow, and the modest progress that has occurred has been disappointing.

    As the CSA acknowledge in the request for comments, the shareholder voting system has evolved over time into a highly complex intermediated system.  The CSA request for comments focuses on the complexity inherent in the vertical dimension of the shareholder voting process.  This is the dimension that allows votes and other shareholder rights to flow from the issuer at one end of the vertical process to the investor at the other end.

    The degree of complexity in the vertical axis is matched by an equivalent degree of complexity in the horizontal axis.

    On the horizontal axis we find at each layer of the vertical axis numbers of stakeholders who have similar roles.  In certain cases collaboration among roles has resulted in some form of integration in the processes applied at that layer.  For instance, transfer agents in Canada collaborate as members of the Stock Transfer Association of Canada.  At the intermediary level there is similar industry collaboration in the Investment Industry Association of Canada. There are similar associations at most of the horizontal layers; for instance the Canadian Coalition for Good Governance for institutional investors; the Canadian Securities Administrators for securities regulators; and so on.

    It is quite apparent that there are gaps in the collaboration that militate against meaningful progress.  To mention one of those gaps, at the regulatory level, there does not appear to be sufficient engagement between the CSA and their regulatory counterparts on the corporate law side.

    Also absent from the field is the Bank of Canada.  To some degree the problems experienced in the shareholder voting process are a symptom of a settlement and clearing deficiency for which the Bank of Canada has traditionally played a central leadership role, yet there is no evidence that these issues are on the Bank of Canada’s radar screen.

    Any attempt to address the serious shortcomings of the current processes requires, as the request for comments points out, a “holistic” approach.  CSCS emphatically agrees with that assessment.  The comprehensive approach that CSCS advocates is one that addresses not only the vertical dimension of complexity, but also its horizontal axis.  CSCS believes that anything less will fail to lead to significant improvements in the process.

    CSCS advocates a comprehensive approach to reform with the following salient features:

    • Fundamental reform of both corporate and securities law rules relating to shareholder voting:
      • Securities and corporate regulators both fully engaged and committed to the reform process.
      • Registered and beneficial shareholders to enjoy the same voting and participation rights.
    • Elimination of the OBO NOBO distinction:
      • Restoring the issuer’s right to know the identity of its shareholders.
      • New rules for nominee holders that respect the investor’s right to maintain privacy in relation to holdings and voting, while also respecting the issuer’s right to know its shareholder.
    • Complete dematerialization of the voting process:
      • Entirely digital end-to-end processes.
      • Normalized data flows for shareholder security positions as of the record date including voting and participation entitlement;
    • Auditable data trails coupled with effective processes and controls to ensure respect for the integrity of the voting process.
    • A specific roadmap for reform with defined milestones and a reasonable horizon for completion.

    CSCS acknowledges that the challenge presented by the approach we advocate is substantial.  It is important for stakeholders to bear in mind however that the ultimate objective is a very modest one: to ensure that shareholder votes count with the same degree of integrity that applies to other shareholder rights like dividends for instance.

    Canada is not the only country experiencing challenges when it comes to shareholder voting.  We could seize the opportunity to be the first country to tackle the issue in a straightforward and intelligent way to deliver effective reform, as well as industry-leading processes.

    Regulators, who coexist in horizontal silos similar to other stakeholders, have a key role, perhaps the key role to play.  It is unfortunate that the regulators have yet to come together on this issue.

    The CSA, the provincial and federal regulators who determine corporate law and policy, and the Bank of Canada have a responsibility to lead the way by entering into a meaningful collaboration to address shareholder voting processes.

    Effective shareholder voting is one of the cornerstones of effective governance and healthy capital markets.  The CSA’s primary responsibility is to protect Canadian investors and to regulate the functioning of Canada’s capital markets.  That mandate led the CSA in its pioneering efforts to address shareholder voting processes.  It is clear however that the CSA cannot succeed in resolving the current problems without engaging with other regulators in a concerted way.

    The request for comments asks two key questions:

    Is accurate vote reconciliation occurring within the proxy voting infrastructure?

    The answer to this question at the present time cannot be anything other than “no”.  There are some processes currently in place that seek to reconcile shareholders, issuers, and votes, but none could be called “end-to-end.”

    What type of end-to-end vote confirmation system should be added to the proxy voting infrastructure?

    For “end-to-end” to have any real meaning, the system has to reconcile voting from the shareholder to the issuer, and it has to happen for all shareholders.  At the present time that is not occurring.

    Information technology has been the key enabler that allowed the capital markets to grow in scope, pace and volume of transactions in the recent past.  It has done so by forsaking paper-borne processes in favour of machine-borne processes.  Given the timing constraints of shareholder meetings, given the large number of shareholders, given the sheer volume of information and transactions that must flow to enable shareholders to vote effectively, there is no longer any room for paper-borne processes.

    It is time to adopt end-to-end digital processes for shareholder voting, that is to say, to dematerialize the entire voting process.  With digitization, there will be a sound basis for end-to-end vote reconciliation, for the audit of processes and transactions, for quality assurance, and for greater timeliness.

    Some aspects of the current dysfunction, in particular the impact of share lending on the quality of the shareholder vote, will be very difficult to deal with effectively unless the process is dematerialized.
    There is evidence at the present time that certain institutional shareholders are now reluctant, or have completely ceased, to lend their portfolios because share lending interferes unduly with the ability to exercise voting rights.  What will be the impact on the capital markets if more and more institutional shareholders follow suit?

    Information technology is a powerful enabler and can support robust processes that accomplish objectives that paper-borne systems are incapable of achieving.  For instance, if all data flows for voting information were normalized:

    • voting information could flow at electronic speeds rather than post office speeds;
    • shareholder entitlements could be effectively tracked and reconciled without privacy concerns;
    • it might become possible to allow portfolios to be lent ex-vote;
    • it is also possible that an IT-borne voting infrastructure would allow concerns related to ‘empty-voting’ to be addressed effectively;
    • for the first time, shareholder voting dashboards could become a reality for all shareholders, not just for the privileged few who have access to a transfer agent’s voting platform or Broadridge’s Proxy Edge system.

    The foregoing only begins to scratch the surface of possibilities could emerge as the fruit of dematerialization and fundamental reform in the voting process.

    Next Steps

    The request for comments seeks guidance on next steps.

    CSCS strongly advocates the following next steps:

    1. The regulators should collaborate.  CSA, the corporate regulators, and the Bank of Canada need to come together to address the concerns with the shareholder voting system.

      At its heart shareholder voting is a corporate law concern.  For many issuers the ratio of beneficial shareholders to registered shareholders is in excess of 90%.  Yet corporate law largely ignores beneficial shareholders.  It is more than high time that beneficial shareholders get equal rights.  The corporation regulators need to take ownership of that issue and work closely with the CSA to ensure that all shareholders are treated equally.

      Finally, the Bank of Canada has a key role to play.  The problems with shareholder voting are a symptom of a partial settlement and clearing failure.  The current depository system came about to address settlement and clearing problems for securities transactions that resulted from the pace and volume of transactions that had outstripped the shareholder registration paradigm that prevails under corporate law.  The old share registry and paper certificate system was dying under its own weight and impeding the efficient flow of capital.  The book-based depository system that evolved solved the capital markets problem for two of the three key shareholder entitlements: i) the right to buy and sell, and ii) the right to dividends.  Voting, the third key entitlement was neglected.  In the result, the gates and processes that must be aligned to allow votes to be properly exercised and counted in many cases are in disarray.  In fairness to all concerned, it is only recently that shareholder voting has emerged as a key governance tool for modern public companies.  The problems are well-documented, and the time to act is now.
    2. Reliable information must be gathered.  The request for comments asks a series of excellent questions for which answers are urgently needed.  The questions probe for information on the processes at work amongst the agents whose roles lie between the shareholder and the issuer: transfer agents, intermediaries and Broadridge.

      If dematerialization is to occur (and it must occur for the system to improve), the information flows and processes at play among all those agents must be mapped.  That is the only path that can lead to creating the normalized data structures that will allow high integrity data to flow in real time from end to end in the voting system.  The CSA already have the regulatory tools and authority that will allow that information to come to light.  Doing that process mapping is a vital first step.  It will be painstaking work and it will be time consuming if it is to be done properly.  Without that information gathering phase, it will be very difficult and perhaps impossible to make any real progress.
    3. A roadmap for reform should be proposed.  If the problems with shareholder voting are to be addressed effectively and in a timely manner, the regulators need to set the pace and there has to be a reasonable timetable for reform.  As part of its proposed Facilitation Program, CSCS proposed five years as a reasonable timeframe for reform.  A roadmap for reform should have three distinct phases:
      • Information gathering;
      • Determining the reforms needed to be implemented;
      • Implementation.

      Without a disciplined process and milestones to judge progress, it will be very difficult or impossible to make any significant improvements.

    4. Sectorial approaches to the problem should be set aside in favour of overall reform.  Notice and Access is a case in point.  Notice and Access has largely failed to deliver the hoped-for benefits of reducing paper burdens, streamlining the meeting information process, and reducing costs.  The reason is that Notice and Access simply does not go far enough, and there was a lack of collaboration among concerned regulators.  At the core of Notice and Access remain paper-borne processes.  The result is another layer of regulation, longer lead times and additional fees that, at least for issuers, have failed to deliver much in the way of savings, and made setting key dates for the meeting process even more difficult to do.  Additional sectorial approaches to the problem should not be contemplated in the absence of a compelling need.
    5. Funding for a dematerialized voting system should be studied.  At the present time issuers bear substantial proxy solicitation costs, as do other stakeholders.  A well-functioning, end-to-end, dematerialized voting system should yield cost savings for all stakeholders, but it will not eliminate all of the current expense.  A new information technology-based voting system will need to be funded by stakeholders in a fair way so that everyone benefits.  Planning will be required to make that happen.

    We at CSCS will continue to do our best to advance the cause of reform and to work will all stakeholders to achieve that objective.  We encourage all stakeholders to come forward to share their concerns, to discuss avenues for reform, and to collaborate to address these concerns.

    On a final note, the request for comments at footnote 58 notes that unresolved over-reporting situations occurred in at least 17% of meetings.  At the CSCS annual governance conference in Halifax this past August, Computershare provided updated statistics that showed 17.02% for 2011, 22.70% for 2012 and 25.71% for 2013.

    These metrics are truly a cause for concern and they reveal a troubling and worrisome trend.  All the more reason to marshal vigorous efforts to address these important issues.
     

    Yours truly,

    David Masse
    Chairman of the Board

  • 07 Oct 2013 9:38 AM | GPC Webmaster (Administrator)


    On October 3, 2013, the Canadian Society of Corporate Secretaries ("CSCS") submitted a comment letter to the Ontario Securities Commission (OSC) in response to their request for comments on their Staff Consultation Paper 58-401: Disclosure Requirements Regarding Women on Boards and in Senior Management.

    As the principal advocate for those who work in the front lines of corporate governance, CSCS strives to enhance the public's awareness of the importance of good governance. CSCS is the voice of governance professionals in Canadaand participates with other stakeholders, including capital markets participants, government bodies and regulators, in fostering a governance environment that sets Canada apart in the world. CSCS also supports its membership with continuing education and networking opportunities.

    In preparation for this response CSCS undertook a consultation with our members at open sessions held inVancouver, Calgary and Toronto in mid-September.

    The CSCS member consultations were well attended, and small, mid and large-cap issuers were all represented. The comments provided in our letter represent the general views of members who participated in the consultations for a course of action that is believed to be both effective and not overly prescriptive.

    CSCS applauds the OSC for addressing the critical issue of gender diversity on boards and in senior management of Canadian publicly traded corporations (Corporations). Our members believe that achieving gender diversity is a positive step towards greater diversity and we encourage the OSC to consider further diversity initiatives that will encourage corporations to work towards including under-represented groups in senior management and on their board of directors.

    Our members felt that best practice guidelines, together with mandated disclosure, are the ideal combination - allowing a Corporation to determine the appropriate path for it to reach gender diversity and ensure transparency to stakeholders. Members who participated in the consultations were divided in their views as to whether Corporations should be required to: (i) disclose their approach to gender diversity with reference to such best practice guidelines, explaining any differences ("comply or explain") or (ii) satisfy certain minimum best practice guidelines including a target percentage of 20% to 40% to be achieved over a five year or longer period.

    It was felt that most Corporations should be able to:

    • Determine the target and time line (based solely on its own assessment or within the minimum guidelines, as the case may be) appropriate to its circumstances;
    • As information becomes available, benchmark the target;
    • Disclose the reasoning behind the selected target;
    • Disclose the details of the plan to be implemented in order to reach the target through board renewal process, proactive management or inclusion of new policies or practices, such as term limits; and
    • Annually report on progress.

    Requiring Corporations to explain their self-governing approach to implementing gender diversity practices in their senior management and on their boards will result in clear and useful disclosure (rather than boilerplate language) and provide stakeholders with good information on each Corporation's views and commitments to creating gender diversity within their own organization.

    A copy of our comment letter can be found by clicking HERE.

    For further information:

    Lynn Beauregard, President
    255-55 St. Clair Avenue West 
    Phone: 1-416-921-5449, Ext 306
    Email: lynn.beauregard@cscs.org
    www.cscs.org

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