TORONTO, Oct. 4, 2013 /CNW/ - On October 3, 2013, the Canadian Society of Corporate Secretaries ("CSCS") submitted a comment letter to the Ontario Securities Commission (OSC) in response to their request for comments on their Staff Consultation Paper 58-401: Disclosure Requirements Regarding Women on Boards and in Senior Management.
As the principal advocate for those who work in the front lines of corporate governance, CSCS strives to enhance the public's awareness of the importance of good governance. CSCS is the voice of governance professionals in Canada and participates with other stakeholders, including capital markets participants, government bodies and regulators, in fostering a governance environment that sets Canada apart in the world. CSCS also supports its membership with continuing education and networking opportunities.
In preparation for this response CSCS undertook a consultation with our members at open sessions held in Vancouver, Calgary and Toronto in mid-September.
The CSCS member consultations were well attended, and small, mid and large-cap issuers were all represented. The comments provided in our letter represent the general views of members who participated in the consultations for a course of action that is believed to be both effective and not overly prescriptive.
CSCS applauds the OSC for addressing the critical issue of gender diversity on boards and in senior management of Canadian publicly traded corporations (Corporations). Our members believe that achieving gender diversity is a positive step towards greater diversity and we encourage the OSC to consider further diversity initiatives that will encourage corporations to work towards including under-represented groups in senior management and on their board of directors.
Our members felt that best practice guidelines, together with mandated disclosure, are the ideal combination - allowing a Corporation to determine the appropriate path for it to reach gender diversity and ensure transparency to stakeholders. Members who participated in the consultations were divided in their views as to whether Corporations should be required to: (i) disclose their approach to gender diversity with reference to such best practice guidelines, explaining any differences ("comply or explain") or (ii) satisfy certain minimum best practice guidelines including a target percentage of 20% to 40% to be achieved over a five year or longer period.
It was felt that most Corporations should be able to:
- Determine the target and time line (based solely on its own assessment or within the minimum guidelines, as the case may be) appropriate to its circumstances;
- As information becomes available, benchmark the target;
- Disclose the reasoning behind the selected target;
- Disclose the details of the plan to be implemented in order to reach the target through board renewal process, proactive management or inclusion of new policies or practices, such as term limits; and
- Annually report on progress.
Requiring Corporations to explain their self-governing approach to implementing gender diversity practices in their senior management and on their boards will result in clear and useful disclosure (rather than boilerplate language) and provide stakeholders with good information on each Corporation's views and commitments to creating gender diversity within their own organization.
SOURCE: Canadian Society of Corporate Secretaries
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