December 20th, 2017
The Globe and Mail
December 13, 2017
This week, the Senate will vote on Bill C-25. The bill proposes to reform the process for electing directors of distributing corporations and co-operatives and modernize communications between corporations and their shareholders. It also requires distributing corporations to provide shareholders, at annual general meetings, information about diversity among directors and senior management.
The goal of the legislation is to increase diversity among corporate boards and among their executive ranks. The intent of the legislation is right. We need more diversity. But the measures proposed are not enough.
Three years ago, the Canadian Securities Administrators adopted a "comply or explain" model that is specific to the representation of women on boards and applies to most publicly traded companies in Canada. Bill C-25 emulates this approach.
Results have been disappointing: Only 14 per cent of board seats are now occupied by women, a meagre three-percentage-point progress from 11 per cent in 2015. Regarding senior management, only 15 per cent of positions are filled by women, a proportion that has not progressed at all since 2015.
Women are better represented on boards and in senior executive positions at larger firms. But even in FP500 companies, other groups are unacceptably underrepresented. Only 1.1 per cent of board members are Indigenous, 3.2 per cent are persons with a disability and 4.3 per cent are members of a visible minority.
Why would an approach that has yielded so few advances in recent years work better in the future? The government is asking Canadians to be patient, but shouldn't we request an improved approach? We strongly believe we should.
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