The Canadian Council for Good Governance (the
"CCGG") has stated that proxy access is
high on their agenda. Proxy access generally
refers to the ability of shareholders to nominate their own
candidates for the board and have those nominees included in
management proxy materials alongside management nominees. The CCGG
is in the process of drafting its policy on the topic.
"We have no proxy access in Canada other than this
provision in most of the corporate statutes that says that if
you're a five per cent shareholder you can do a shareholder
proposal to nominate a director. It's used very rarely and it
allows the company, if it wants to, to attach the proposal as an
appendix to its proxy circular... So it's not an effective way
to have proxy access in Canada."
In its December 2014 review of the consultation
drafts of the Provincial Capital Markets Act and the
Capital Markets Stability Act, the CCGG stated that
"[i]t is onerous and prohibitively expensive for shareholders
to propose alternate directors for election and to actively solicit
other shareholders to vote for their nominees..."
The CCGG went on to express its support for allowing
shareholders who hold 3% of the outstanding shares, in aggregate,
to be able to nominate up to 25% of the directors and to have
information about those nominees included in the management proxy
information circular in the same manner as the company's
In its May 2014 review of Industry Canada's
Consultation Paper on the Canada Business Corporations
Act, the CCGG also outlines its stance on proxy
To discuss the merits of the CCGG's draft policy, the CCGG
recently co-hosted a proxy access roundtable with the Centre for
the Legal Profession. Mr. Erlichman stated that proxy access is
"the right thing to do" and that the CCGG's policy
would, among other things, allow for reasonable solicitation costs
of nominating shareholders to be paid for by the company, cap the
number of nominees and eliminate holding periods.
An opposing view came from Stan Magidson, President, CEO and
Director of the Institute of Corporate Directors. Mr. Magidson
stated that "the cost benefit analysis for the policy falls
far short of providing a convincing economic underpinning for
reform" and that "the proposal does not enhance proxy
access in any meaningful or necessary way." Mr. Magidson
warned that the CCGG's proposal would bring, if adopted, a more
adversarial model to Canada.
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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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