Diversity and the equal representation of men and women on
corporate boards of directors are of increasing interest to
investors, Canadian financial-market regulators and the general
The importance a company affords these matters is considered by
many to be a corporate governance issue. Accordingly, more and more
governments and financial-market regulators are seeking to
encourage or force public companies to increase the number of women
directors on their boards, failing which the companies may be
compelled to inform their shareholders of or justify the gender
In 2011, Quebec innovated in this regard by amending the Act
Respecting the Governance of State-owned
Enterprises1 such that boards of directors of
provincial Crown corporations must be composed of equal numbers of
men and women and must reflect the diverse makeup of Quebec
Since that amendment came into force, the vast majority of
boards of directors of Quebec's Crown corporations have
achieved gender parity. The same is not true however of
corporations in the private sector.
A study by Catalyst revealed that in 2013 women occupied only
15.9% of the seats on the boards of directors of the Financial Post
500 corporations and had zero representation on the boards of
nearly 40% of them.
And while Quebec is above the Canadian average in terms of the
proportion of women on corporate boards, many consider that to be
due to the recently amended legislation on provincial Crown
Regulators seek to intervene
The majority of financial-market regulators now want to ensure
that corporations either adopt policies aimed at increasing
diversity and the number of women on their boards of directors or,
failing that, explain to their investors why they have not done
One of the first securities commissions in Canada to take
concrete action in this regard is Ontario's. In early 2014, the
Ontario Securities Commission submitted for comments a draft
amendment to its corporate governance rules whereby all reporting
issuers listed on the TSX and other reporting non-venture issuers
would be required to inform their shareholders of their policy
aimed at increasing women's representation on their boards, or
to explain why they do not wish to do so.
The period for submitting comments has now expired, and the ones
received were mainly positive. The few dissenting comments
primarily called into question the legitimacy of regulatory
intervention in the composition of the boards of directors of
The Ontario Securities Commission is expected to adopt the
amendments in late 2014. However, no sanction is provided for
non-compliance with the new rules.
Last July, the securities regulatory authorities in
Saskatchewan, Manitoba, Quebec, New Brunswick, Newfoundland &
Labrador, the Northwest Territories and Nunavut followed
Ontario's lead and published a draft amendment to Regulation
58-101 on information concerning corporate governance
Those authorities are also seeking input from industry
stakeholders. However, the securities authorities in British
Columbia, Alberta and Prince Edward Island have not yet shown any
inclination to adopt such new rules.
At the federal level, the Minister of Labour and Minister of
Status of Women, K. Kellie Leitch, last June presented the
report of the Advisory Council for Promoting Women on Boards.
Entitled "Good for Business: A Plan to Promote the
Participation of More Women on Canadian Boards", the report
canvasses best practices in Canada and around the world and
establishes goals and makes recommendations to the Government of
Those recommendations include the following:
a national goal of 30% gender balance by 2019;
ensuring greater participation in the recruitment of women to
leadership positions and appointments by cabinet decree;
instituting a "comply or explain" approach for
publicly traded companies;
promoting gender balance through policies, human resources
practices, board nomination committees, etc.
Europe leads by example
Europe, which is in the avant-garde in this respect, continues
to promote equal participation of women and men in the corporate
decision-making process. In 2012 the European Commission adopted a
directive aimed at bringing the proportion of women on the boards
of publicly traded companies to 40% by 2020.
A year later the European Parliament debated this issue and
subsequently adopted the European Commission's proposal.
Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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