Canada: Women On Boards: Progress On Gender Diversity Still Slow, CSA Reports

The number of women on boards and in executive positions has risen compared to last year, but progress on gender diversity remains slow, the Canadian Securities Administrators (CSA) have found in their recently published CSA Multilateral Staff Notice 58-310 Report on Fourth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions (Notice). The Notice continues the review, for a fourth year, of "comply or explain" disclosure provided by non-venture public companies concerning the representation of women on boards and in executive positions, as set out in Form 58-101F1 Corporate Governance Disclosure (Form).

The Notice follows three similar sets of review, the most recent of which found only small improvements from the findings of the first- and second-year reviews. See our October 2017 Blakes Bulletin: CSA Reports Another Small Step for Women; Still No Giant Leap for Humankind.

FOURTH-YEAR REVIEW RESULTS

The Notice continues the review of the compliance with gender diversity disclosure requirements for 648 issuers with financial year-ends between December 31, 2017 and March 31, 2018 (thereby omitting large Canadian financial institutions with October 31 year-ends). As in prior years, progress has been made for the representation of women on boards and in executive positions; however, the overall pace of change has been slow. The Notice found mostly positive improvements from the findings of the third-year review, as follows:

  • Overall percentage of board seats occupied by women increased from 14 per cent to 15 per cent as compared to the prior year (12 per cent two years ago), increasing in all size categories of issuers, with the 47 largest issuers leading the way at 25 per cent (up from 24 per cent in the prior year and 23 per cent two years ago)
  • 561 vacant board seats were filled during the year, with 29 per cent of the new directors being women (up from 26 per cent in the prior year)
  • 34 per cent of issuers did not have a woman on their boards, down from 39 per cent in the prior year (45 per cent two years ago)
  • 66 per cent of issuers disclosed having at least one woman in an executive officer position, up from 62 per cent in the prior year (59 per cent two years ago)
  • 42 per cent of issuers disclosed they had adopted a policy relating to the identification and nomination of women directors, an increase of seven per cent compared to 35 per cent in the prior year (21 per cent two years ago), and issuers with such a policy had a greater overall percentage of board seats occupied by women (20 per cent) as compared to issuers without such policies (12 per cent)
  • 16 per cent of the issuers had targets for the representation of women on their boards, an increase from 11 per cent in the prior year (nine per cent two years ago), with four per cent of issuers having a female CEO and 14 per cent having a female CFO
  • Issuers with board targets had, on average, female board representation of 24 per cent, compared to 13 per cent for issuers that did not have a target
  • 73 per cent of issuers disclosed that they considered the representation of women on their boards as part of their director identification and nominating process, an increase from 65 per cent in the prior year (66 per cent two years ago)
  • 60 per cent of issuers disclosed that they considered the representation of women when making executive officer appointments, compared to 58 per cent in both the prior year and two years ago

REGULATORY RESPONSES

In light of the experience derived from the past four annual reporting periods, the CSA has engaged in consultations, research and disclosure reviews and continues to consider, in particular, whether further changes to the disclosure requirements in the Form and introduction of new or supplemental guidelines regarding corporate governance practices in National Policy 58-201 Corporate Governance Guidelines are warranted. To date, no decisions have been made.

PROXY ADVISOR DEVELOPMENTS

On January 4, 2018, ISS published its Canadian proxy voting guidelines for the 2018 proxy season, which articulated a new gender diversity guideline (ISS Guideline). See our January 2018 Blakes Bulletin: 2018 Proxy Advisory Firm Voting Guidelines: Canadian Highlights. The ISS Guideline was applicable to S&P/TSX Composite Index issuers in 2018 and is being expanded to both S&P/TSX Composite Index and non-Composite Index issuers in 2019, subject to certain exceptions. Under the ISS Guideline, ISS will generally issue a "withhold" voting recommendation concerning the chair of the committee responsible for nominating candidates for election to the board (or board chair if no applicable committee or committee chair has been identified) of issuers that have not disclosed a formal written gender diversity policy and do not have any women directors on their boards.

ISS has noted that gender diversity policies of such issuers should include a clear commitment to increase board gender diversity within a reasonable period, with measurable goals and/or targets, and that use of boilerplate or contradictory language may result in "withhold" voting recommendations for directors. In applying the new ISS Guideline, ISS will also consider such issuers' disclosed approach to considering gender diversity in executive officer positions when formulating a voting recommendation. The ISS Guideline does not apply in respect of issuers with four or fewer directors, newly publicly-listed issuers within the current or prior fiscal year, and issuers that have transitioned to the TSX from the TSX Venture Exchange within the current or prior fiscal year.

In its 2018 Canadian proxy voting guidelines, Glass Lewis provided advance notice that, for the 2019 proxy season, it will generally issue a "withhold" voting recommendation concerning the chair of the committee responsible for nominating candidates for election to the board, or board chair, if the issuer has not adopted a formal written gender diversity policy or does not have any women directors on its board (GL Guideline). Glass Lewis has also noted that, depending on other factors, including the size of the issuer, the industry in which the issuer operates and the governance profile of the issuer, in 2019, it may also extend "withhold" voting recommendations to other members of the committee responsible for nominating candidates for election to the board. In applying the GL Guideline, Glass Lewis has retained discretion to refrain from recommending "withhold" votes to directors of issuers outside the S&P/TSX Composite Index, or when issuers' boards have provided a sufficient rationale for not having any women board members or have disclosed a plan to address the lack of board diversity.

CONCLUSION

Progress continues to be slow in the fourth year since the Form was amended to require gender diversity disclosures. Although some momentum may be building as investors continue to pressure issuers to add more women to their boards and executive officer positions, regulators continue to consider further measures to increase the representation of women and amendments to the Canada Business Corporations Act to require disclosure on further aspects of diversity await coming into force.

For permission to reprint articles, please contact the Blakes Marketing Department.

© 2018 Blake, Cassels & Graydon LLP.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Events from this Firm
26 Oct 2018, Other, Vancouver, Canada

Cybersecurity, including data privacy and security obligations, has become a critical chapter in every company’s risk management playbook.

30 Oct 2018, Other, Toronto, Canada

Please join us for discussions on recent updates and legal developments in pension and employee benefits as well as employment law issues.

12 Nov 2018, Other, Toronto, Canada

Stories aren’t falsehoods. Stories are the root of all effective human communications: they motivate, animate and clarify. If you aren’t telling stories, you probably aren’t getting your point across.

Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions