- Advisory say-on-pay vote should not be made mandatory -
TORONTO, April 4 /CNW/ - The Canadian Investor Relations Institute
(CIRI) submitted comments to the Ontario Securities Commission (OSC) in
response to OSC Staff Notice 54-107 regarding potential regulatory
reforms to shareholder democracy issues.
Three areas were identified by the OSC as requiring additional review
and, potentially, the development of regulatory proposals for reporting
slate voting and majority voting for uncontested director elections;
shareholder advisory votes on executive compensation; and
the effectiveness of the proxy voting system.
"CIRI supports the OSC review of practices in the area of shareholder
democracy and welcomes the opportunity to participate by providing our
comments," said CIRI CEO, Tom Enright. "Improving the state of
shareholder democracy will undoubtedly contribute to the transparency
and integrity of Canadian capital markets, which are among the primary
objectives of CIRI."
In summary, CIRI's letter to the OSC, which was guided by a recent
limited poll of its members, submits the following:
Reforms to securities laws are appropriate, to facilitate individual
director voting as well as both binding majority voting for uncontested
director elections and a non-binding (modified plurality) majority
voting standard consistent with recommendations by the Canadian Centre
for Good Governance (CCGG).
The OSC may wish to consider replacing "withhold" votes, which are
currently an option in director elections, with either "abstain" or
CIRI believes that advisory Say-on-Pay votes should not be made
mandatory for Canadian reporting issuers.
The three issues most in need of review in the proxy voting system are:
the influence of proxy advisory firms; the lack of transparency and
share ownership disclosure in the OBO/NOBO system; and poor delivery of
proxy-related materials to shareholders.
Further, CIRI's comments to the OSC reinforce a recent, related CIRI
submission to securities regulators that states shareholder democracy
can be further improved through enhanced share ownership disclosure by
lowering the share ownership disclosure threshold from 10% to 5% of
CIRI is a professional, not-for-profit association of executives
responsible for communication between public corporations, investors
and the financial community. CIRI contributes to the transparency and
integrity of the Canadian capital market by advancing the practice of
investor relations, the professional competency of its members and the
stature of the profession. With more than 600 members, CIRI is the
world's second largest society of investor relations professionals. For
further information, please visit CIRI.org.
SOURCE Canadian Investor Relations Institute
For further information:
Senior Manager Communications & Professional Development, CIRI
(416) 364-8200 x 224