On October 4, 2012, the Toronto Stock Exchange ("TSX")
request for comments on proposed amendments to Part IV of the
TSX Company Manual (the "Proposed Amendments"). The
Proposed Amendments would require issuers listed on the TSX to have
majority voting when electing directors at uncontested security
holder meetings. As currently proposed, issuers may adopt a
majority voting policy to comply with the requirement.
Under mandatory majority voting, security holders vote
"for" or "against" each individual board
nominee and only those directors who receive a majority of votes in
their favour remain on the board. Typically, a majority voting
policy provides that a director who receives a majority of
"against" votes must immediately tender his/her
resignation to the board of directors. The Proposed Amendments
would require the board of directors to issue a news release
disclosing: (i) the detailed results of the votes received for the
election of each director; and, where applicable, (ii) whether a
resignation was accepted and the board's reasons for the
As indicated by the Canadian Coalition for Good Governance, 39%
of the listed issuers in the S&P/TSX Composite Index do not
have majority voting. The TSX asserts that the Proposed Amendments
will improve corporate governance standards, strengthening
Canada's international reputation.
Comments on the Proposed Amendments are being accepted until
November 5, 2012. The TSX anticipates that the Proposed Amendments
could become effective as of December 31, 2013.
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