Proxy access proposals arrived in a big way this season, with
almost 120 proposals and average votes in favour of 54.4% (a jump
of more than 20 percentage points from 2014). A typical proposal
grants shareholders who have held 3% of the company's shares
for 3 years the ability to include, in the company's management
proxy circular, nominees for up to 25 per cent of the board.
As discussed in our previous posts by Kaitlind de Jong and Trevor Zeyl, the topic of proxy access has
been picked up by the Canadian Coalition for Good Governance, so we
can expect to see this issue surface increasingly in Canada as
A greater proportion of proxy contests settled in 2015 as
compared to 2014, as more companies elected to negotiate rather
than go to a contested meeting. Despite this trend, the first half
of 2015 still featured more contested meetings than the same period
in 2014, and the size of targets was larger, with the median market
cap of targeted firms reaching an all-time high of $518
million. Of proxy contests that went forward, activists'
success rate in placing a director on the target board fell from a
high of 70 per cent in 2014 to under 50 per cent this year.
Environmental & social issues continued to account for the
largest number of shareholder proposals. The voting success of
these proposals was down from 2014, but proponents continued to
find success in engaging boards. Discussions with management
resulted in the withdrawal of about 40 per cent of environmental
& social issues proposals, typically in negotiations resulting
in agreement by the targeted company to take steps to address the
Other forms of shareholder engagement, such as letter writing
campaigns, took some of the action out of the proxy arena in 2015,
as activists found success with these alternative means of engaging
boards and making their concerns heard.
Average support for management say-on-pay votes rose slightly
over last year, as compensation issues receded in prominence.
The ISS report shows that activist activity continues to grow,
incorporating new and old issues. While the number of
contested meetings is up, more challenges are also being resolved
outside of a formal proxy contest, either through early negotiation
and settlement or through the use of alternative means of board and
ISS' data is from the U.S., but new issues such as proxy
access have already been raised in Canada. We can expect to
hear more about these trends in the remainder of 2015 and into
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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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