Bill C-473 (Historical)

An Act to amend the Financial Administration Act (balanced representation)

This enactment amends the Financial Administration Act to achieve balanced representation in the number of women and men serving as directors on boards of parent Crown corporations by establishing the minimum proportion of each sex on those boards.

Financial Administration Act

[Judy Sgro, Liberal, York West, ON]

Mr. Speaker, I am pleased to lead off the debate for the Liberal caucus and to speak in favour of Bill C-473 at second reading.

Of course, the Liberal Party has a long and well-established reputation as a leader and an advocate for gender equality, as many in this House do, in all areas of society and our parliamentary caucus continues to be committed to this legacy.

On April 17, 1982, Liberal Prime Minister Pierre Elliott Trudeau signed the Canadian Charter of Rights and Freedoms into law and, with it, section 15 took effect. As a result of Mr. Trudeau's quest for a just society, section 15 assured that every individual is equal before and under the law and has the right to the equal protection and equal benefit of the law without discrimination.

So, while the charter-signing ceremony took place under the capital's cloudy skies, its impact was to provide a fledgling ray of sunshine for women and girls struggling against the odds. For the first time in our history, the Constitution of Canada formally recognized that men and women were viewed as equals in every way, under Canada law. However, there was still much yet to be done along the road to full equality for Canadian women. Today, three decades after Mr. Trudeau's historic move, Canadian women and girls continue with their efforts to attain full gender parity.

For most people, myself included, particularly those within the Liberal Party, there is a clear understanding that inclusion promises tangible benefits, both socially and economically, for the nation as a whole. Canada's economy can be strengthened immensely by employing more women and by ensuring their entrance in vocational fields traditionally occupied only by men. That is why I am speaking to this issue today.

Primarily, Bill C-473 proposes to require that the composition of the board of directors of a parent crown corporation shall be such that the proportion of directors of each gender is not less than 30% the second year, 40% the fourth year, and 50% the sixth year. The legislation does stipulate that the numbers may vary when the board of directors consists of no more than eight members. In these instances, Bill C-473 proposes that the difference between the numbers of directors of each gender may be not greater than two.

Now, these are laudable objectives that I applaud but, prior to committing to support Bill C-473 at all legislative stages, I would like to have a few specific questions answered both here and for discussion at our committee.

First, are the gender breakdown numbers being cited in the legislative preamble accurate, and is there a reason for the current levels?

Second, what would the real world impact be upon business if mandatory quotas of this nature were established with the timelines suggested?

Third, what penalties would be imposed upon non-compliant boards and agencies?

I am a lifelong and strong advocate for gender equality, as are many in the House. However, I believe that the standing committee would be an appropriate venue for us to have a full discussion on the implications of Bill C-473, and I think the appropriate place for that is, of course, with the status of women.

I also have questions that the sponsor may be able to answer. On March 8, 2012, the member for London—Fanshawe introduced Bill C-407. That legislation is nearly identical to Bill C-473, with one notable exception. Bill C-407 would have required that federally regulated boards be made up of at least 40% women. Bill C-473 is premised upon Bill C-407, but the new legislative proposal seeks to elevate the percentage to 50% commencing in the sixth year following the coming into force of the section. I am not suggesting that the change is good or bad, but I would like to know why Bill C-407 and Bill C-473 have proposed different target percentages. I am quite sure that the mover of the bill will be able to explain that further at committee level so that we can have further debate on it at our committee.

There are also considerations on the business side of the equation.

Bill C-473 seeks to rapidly modify the environment in which crown corporations must function. As such, consideration must be given to ensure that both gender equality and corporate success can exist simultaneously under the proposed rules set out in this legislative package.

Perhaps we can all agree that Bill C-473 establishes a legal goal without speaking to the methodology necessary to attain that important goal. As it seems this portion of the discussion has been forgotten or omitted by the sponsor, the Liberals on this side of the House believe it is prudent to explore the issue at committee prior to determining amendments and voting intentions at report stage or third reading in the House of Commons.

This is not to say we will lend our support to Bill C-473. In fact, I am asking all members of the House to support it at second reading and to send it to the standing committee so we can explore all of the avenues.

Gender inclusion promises tangible benefits, both socially and economically, for Canada. I am hopeful that Bill C-473 is just one more step along that path. Hope is important because Canada has clearly been slipping as of late.

In October 2012, The Globe and Mail reported that when compared globally, Canada had fallen three spots and was no longer in the top 20 nations when it came to those making progress on equality issues. In fact, the World Economic Forum's annual gender gap ranked Canada in the 21st spot, behind the Philippines, Latvia, Cuba and Nicaragua. When the study was first conducted in 2006, Canada was in the 14th place out of 115 countries. That was leadership.

Although Canada landed in the 12th spot regarding economic opportunity for women and girls, with high levels of income, labour market participation and professional workers, it must be noted that wage equality still lags behind international benchmarks.

On April 17, 1982, Canada emerged as a global leader in the fight for gender equality, but in the 31 years since our lustre has been somewhat tarnished. Today, as in 1982, there is much to be done to help Canadian women and girls and that work must begin in earnest.

I thank the sponsor of this bill and I look forward to working with all members of the House and with our status of women committee to thoroughly debate the pros and cons of Bill C-473 that is before us.

[Stella Ambler, Conservative, Mississauga South, ON]

Mr. Speaker, it is an honour for me to rise today to speak to Bill C-473, an act to amend the financial administration act. As we know, women are significantly under-represented on corporate boards and our government certainly believes that having more women on corporate boards is smart for the economy, our government's number one priority.

Research shows that businesses with more women on their boards are more profitable. They routinely outperform those that have fewer women.

With economic uncertainty still ahead, that is the kind of business performance Canada needs if we are to grow our economy. It makes sense to recruit from the whole talent pool, not just part of it. However, when it comes to increasing the gender representation on boards of directors of crown corporations, the proposed solution in the bill is not acceptable. Legislated quotas are rigid and arbitrary thresholds that would adversely affect the appointment process.

That said, we agree that increasing opportunities for women to serve on corporate boards, including those of crown corporations, makes good sense for Canadian women and for Canada’s economy.

That is why economic action plan 2012 called for the creation of an advisory board, which the member opposite mentioned. It is a council of leaders that will link organizations to a network of skilled and experienced workers. Its goal is to increase the representation of women on corporate boards. By increasing opportunities for women's leadership, the council will also help to keep Canada's economy strong.

Hon. members may know that the Minister for Status of Women recently announced the membership of the advisory council. We are talking about such distinguished individuals as Isabelle Hudon, president of Sun Life Financial, Quebec; Arlene Dickinson, owner and CEO of Venture Communications and an entrepreneur and host of Dragons' Den; John Ferguson, chair of the board of Suncor; Murray Edwards, president and owner of Edco Financial Holdings Ltd.; as well as Janet Ecker, former finance minister for the province of Ontario.

These are only some of the who’s who of women and men with a wide range of experience in our country’s boardrooms.

The advisory council will come back with recommendations by the fall of 2013. This is an important measure to help support increasing women's representation in leadership roles. In fact, there are countless qualified and ambitious women in Canada who want to contribute to our economic success. Promoting the increased representation of women in all occupations, including skilled trades and other non-traditional occupations, will allow women to participate fully in a stronger Canadian economy.

The government is moving forward with a three-point plan to address challenges in connecting Canadians with available jobs. The focus is to equip Canadians with the skills and training they require to obtain high-quality, well-paying jobs.

First, economic action plan 2013 announced that the government will transform skills training in Canada through the introduction of the Canada job grant as part of the renewal of the labour market agreements in 2014-15. Upon full implementation of the Canada job grant, nearly 130,000 Canadians each year are expected to have access to the training they need to fill available jobs. The government would also renegotiate the labour market development agreements to reorient training toward labour market demand.

Second, economic action plan 2013 proposes to reallocate $4 million over three years to reduce barriers to the accreditation of apprentices. The government would work with provinces and territories to harmonize requirements for apprentices and to examine the use of practical tests as a method of assessment in targeted skilled trades. This work would ensure that more apprentices complete their training, and it would encourage mobility, as well. Economic action plan 2013 also proposes to support the use of apprentices through federal procurement, the investment in affordable housing, and as part of the new building Canada plan for infrastructure.

Third, economic action plan 2013 supports under-represented groups. Aboriginal women, for example, are generally less likely to be part of the paid workforce. They experience lower income levels and have less education than their non-aboriginal counterparts. This situation is likely to increase their vulnerability to violence and abuse.

Economic action plan 2013 proposes $241 million over five years to improve the on-reserve income assistance program to help ensure that first nations youth can access the skills and training they need to secure employment. The government will continue, with first nations across Canada, on the development of a first nation education act. It is committing to sharing this draft legislation with first nation communities for their input.

Economic action plan 2013 also proposes $10 million over two years that would provide post-secondary scholarships and bursaries for first nation and Inuit students.

Immigrant women also often face gender-based obstacles to employment, including challenges in foreign credential recognition, resulting in their greater vulnerability to economic insecurity.

Compared with immigrant men, immigrant women in 2009 had lower employment rates, no matter how long they had been in Canada.

Economic action plan 2013 announced the government's commitment to improving foreign credential recognition for additional target occupations under the pan-Canadian framework for the assessment and recognition of foreign qualifications.

Our actions to increase women's economic prosperity and security do not end there. As members know, Canada's economy is one of the most stable in the world. This provides rich opportunities for the largely untapped potential of women as a well-trained and highly educated sector of Canada's workforce. Canadian women entrepreneurs and small business owners will benefit from the following action. Budget 2013 will expand and extend the temporary hiring credit for small business available to a significant portion of women small business owners. This will encourage small business job-creation and reduce small business costs.

The government further proposes to provide $60 million over five years to help outstanding and high potential incubator and accelerator organizations in Canada expand their services to entrepreneurs. We also propose making available a further $100 million through the Business Development Bank of Canada to invest in firms graduating from business accelerators.

Budget 2013 proposes to provide $20 million over three years to help small and medium-sized enterprises access research and business development services at universities, colleges and other non-profit research institutions of their choice.

This will be done through a new pilot program to be delivered through the National Research Council’s industrial research assistance program, which will provide women entrepreneurs with greater access to valuable support.

Rather than relying on one method, as the bill in question proposes, our government has been taking a multifaceted approach to increasing the participation of under-represented groups in the workforce. It is an approach that supports opportunities for every under-represented group in the workforce and that reflects Canada's linguistic and regional diversity.

[Judy Sgro, Liberal, York West, ON]

Mr. Speaker, I would be interested in hearing from my hon. colleague as she moves forward on Bill C-473. She clearly is interested in seeing the kind of progression that we all want to ensure happens for Canadian women. Has she reviewed, or had any contact and discussion on, the bill currently before the Senate dealing with the same issue?

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

moved that Bill C-473, An Act to amend the Financial Administration Act (balanced representation), be read the second time and referred to a committee.

Mr. Speaker, I am pleased to present Bill C-473 to the House today.

The issue of equality between women and men in a fair and equitable Canadian society was always at the heart of my previous professional life and now, today, as a politician, I am truly proud to be able to contribute to this cause.

Bill C-473 proposes a simple but effective improvement in the current legislation governing our public financial administration. Specifically, the bill wishes to offer balanced representation to Canadian men and women on the boards of directors of crown corporations.

The question of gender equity in the management of our crown corporations is not unknown to Canada's Parliament. In the House, the Senate and committees, the fact that still too few women are involved in the management of our political institutions and Canadians businesses remains an important problem that we must consider if we want to be able to say we live in a society with equal rights.

I would like to thank all the pioneering women who worked so hard to advance women's rights, especially in the sectors that traditionally were the preserve of men, such as politics and management.

Among others, I think of the phenomenal work done by the hon. member for London—Fanshawe, on which the spirit of my bill is based, and of my colleague from Churchill, who has been so lively in her defence of the issues affecting the status of women, and of the Senator from Bedford who has been trying for many years to make the infamous glass ceiling vanish.

Despite all their hard work, and while Canadian society has made many strides toward women's rights in recent decades, the numbers speak clearly: there is still a lot of work to do. That is why I decided to introduce Bill C-473.

The most recent data show that over 2,000 Canadians occupy positions in more than 200 crown corporations, organizations, boards of directors and commissions across the country.

Of all the positions available on the boards of directors of these organizations, only 27% of senior management positions are occupied by women. The situation is even worse for presidents of boards of directors. The most current figures show that only 16 of the 84 presidents are women.

Sadly, we are a long way from equal representation that would reflect Canada's demographic makeup and would offer professional growth and development opportunities to our talented women.

With women as 27% of boards of directors of crown corporations, we are far behind the 40% reached in most Scandinavian countries. Other countries such as Spain, France and the Netherlands have introduced measures to encourage more equity in their institutions.

Canada even lags behind the 30% quotas imposed by South Africa and Israel—quotas that have been exceeded for a number of years.

As our country has evolved, it has established a robust democratic process for nominations and appointments to fill the positions on the boards of our crown corporations.

Ministers manage the appointments within their own portfolios, and present their nominations to the Governor in Council.

In the selection process, criteria are established to define the essential qualifications for a given position. In order to attract a large number of potential candidates, a number of mechanisms are used, such as the Governor-in-Council appointments website, executive recruiting agencies, newspapers and specialized publications. Candidates who express an interest are evaluated on the basis of the requirements of the position they apply for.

With regard to the issue of balanced representation, one of the problems—not to say prejudices—our society has had to deal with was that there were not enough women with the necessary qualifications to meet the requirements of the position. This problem disappeared over the years, with mass education for Canadians and access for women to post-secondary studies.

These days, and this is the opinion of a number of experts who have looked at the issue, one problem that persists is that we are still using the traditional recruitment pools to find candidates, where men are still in the majority.

Yet two factors we thought had almost disappeared from contemporary society are still very much in place: the “old boys’ club”, the traditional recruiting network for executive positions, and the familiar “glass ceiling” which is unfortunately difficult to break through for women aspiring to professional careers at the highest level.

My bill proposes an indirect approach to getting rid of these two stereotypes. Through the imposition of a gradual quota for representation of both sexes on the boards of our crown corporations, those responsible for suggesting appointments will be compelled to extend the boundaries of their recruiting methods, and open up the search for candidates with the necessary skills to include a non-traditional recruitment pool.

Canada can rely on a highly qualified female workforce. We can be proud of that. Its ranks include more than 60,000 women who are professional accountants, 20,000 women lawyers, more than 16,000 women engineers, thousands of women university professors and hundreds of women actuaries. There are thus plenty of women with the talents and skills to fill these positions. As a society, all we need do is give ourselves the resources to go out and recruit them.

Another point I would like to address concerns the proposed choice of quotas rather than voluntary incentives.

It must be said that some groups and organizations have come out against this kind of mandatory reinforcement measure. The justification usually given is the fact that the government should not become involved in the choices of outside organizations, like businesses.

Let us not fret. Let us remember, first, that my bill in no way affects organizations of a completely different nature from crown corporations.

It is also important to understand that the proposed choice of quotas is based on the results of careful reflection by experts, published studies and consultations with professional organizations. That reflection also took place in the light of results observed in other countries, where the problem of balanced representation has been addressed in one way or another.

On this point, I would like to share with my colleagues some more enlightening remarks by Anne Golden, chair of the Conference Board of Canada from 2001 to 2012, who noted that at the current pace, it would take 150 years to achieve equity at the top of the organizational ladder if the government did not step in with a mandatory measure.

One other blatant example justifies the establishment of quotas rather than voluntary measures. I am referring to Norway’s failure when it took its first steps in this area. In 2003, Norway was the first country to pass legislation providing for gender equality on the board of directors of public limited companies. The legislation extended to crown corporations and came into force in January 2004. However, in getting to this point, the government had first attempted to negotiate with the private sector so-called voluntary quotas calling for 40% of seats on boards of directors to be held by women, warning that restrictive legislative measures would be brought in should the desired representation not be achieved by July 2005.

A survey of businesses conducted by Statistics Norway revealed that only 13% of businesses had established voluntary quotas and that women held only 16% of the positions on boards of directors as of the 2005 deadline.

That is why this kind of legislation is needed.

Norway went on to extend the scope of the legislation to public limited companies effective January 2006.

This proves that basic measures must be taken and that voluntary quotas do not work.

Another noteworthy example is Quebec. In this instance, theirs is a success story. Quebec is the only province to have adopted legislation aimed at achieving gender equality on crown corporation board of directors since 2006. Efforts in this regard have, to say the least, proved successful. In December 2011, the deadline by which crown corporations were to have achieved gender equality within the five-year period, 141 women and 128 men held positions on the board of directors of 22 Quebec crown corporations. Women made up the majority, or 52.4%, of directors appointed. All that remains is to ensure balanced representation in the number of women and men appointed to the board of each crown corporation subject to the act.

In the case of both Norway and Quebec, the legislation did not cause any problems or result in any additional paperwork, and needless to say, crown corporations are obviously very well managed.

Summing up, I would like to use my speaking time to mention the government’s proposal to set up an advisory committee to look into ways of increasing the proportion of women appointed to company boards of directors, while working with the private sector to come up with concrete solutions.

This is a positive step forward and I can only agree with my colleagues opposite when they say that improving women’s prospects of serving on the board of directors of companies is beneficial for Canadian women as well as for the country’s economy. I assume their logic also extends to the board of directors of crown corporations.

However, in the case of the latter, I think the government needs to set the example and send a strong message about balanced representation in the management of our public finances. Such a message would open the door to many women with latent potential and could inspire companies to do likewise.

That is why I believe quotas are the most appropriate solution for crown corporation boards of directors. We are seeing a real success story in our own backyard. I am referring, of course, to Quebec.

I may have focused till now on the legislative measure proposed in my bill, but I would now like to discuss the time it is taking to achieve equality between the sexes when it comes to our financial administration.

Various approaches have been adopted by countries that have implemented similar measures and, in the case of Quebec, the provincial government gave itself a five-year timeframe. In light of the examples we are familiar with and in order to maximize the chances of success, Bill C-473 proposes a realistic six-year timeframe.

The current figures have female representation hovering around 27%, so it would be realistic to put in place the tools necessary to reach 30% in the next two years, 40% in four years and, ultimately, parity in six years. Obviously, if a board of directors were composed of an uneven number of members, it would stand to reason that there would be an imbalance in the female–male representation.

Before concluding my speech and moving on to questions and comments, I would like to take the few minutes remaining to invite my colleagues from all parties to take advantage of this unique opportunity to showcase the skills and aptitudes of female professionals across Canada.

It is my profound belief that, with this bill, Canada has an opportunity to emerge from the dark ages and position itself as one of the global leaders in gender equality, thereby catching up with many other G20 countries.

Giving competent women an opportunity to realize their full potential and contribute to the development of our community is a question of fairness, rights, democracy and economic prosperity. Everyone wins.

The NDP has always been, and will always be, the staunchest advocate of policies that enable women to fully participate in the stewardship of public finances, and we believe that women should have the same opportunities as men when it comes to serving on boards of directors.

Moreover, in light of the evidence, the NDP strongly believes that diversity among boards of directors is crucial for the good governance of organizations, and that it benefits everyone concerned.

As a woman, fairness and justice are among the fundamental values at the heart of my philosophy and my engagement. In my opinion, this bill is a concrete measure that will help to strike a balance in gender representation when it comes to the management of public finances, while at the same time better reflecting Canadian demographics. I hope, therefore, that my colleagues will come to the same conclusion, and that they will listen to the demands of thousands of women who wish to bring down the glass ceiling and contribute fully to Canadian society.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

moved for leave to introduce Bill C-473, An Act to amend the Financial Administration Act (balanced representation).

Mr. Speaker, I am proud to rise in the House today to introduce a bill that will achieve balanced representation of women and men in financial administration.

At present, only 27% of senior positions on boards of directors of our crown corporations are held by women. I believe that it is about time that Canada follow the lead of a number of countries that have already adopted laws and implemented mechanisms to ensure better representation on the boards of directors of their crown corporations.

The bill I am introducing today will make Canada a leader in this area. I would like to build on the exemplary work of my honourable colleague from London—Fanshawe, who began this endeavour last year by proposing that the government ensure gender parity on the boards of directors of its crown corporation within six years.

I hope that all my colleagues in this House will give their enthusiastic support for this initiative.

(Motions deemed adopted, bill read the first time and printed)