Boards of Directors Modernization Act

An Act to modernize the composition of the boards of directors of certain corporations, financial institutions and parent Crown corporations, and in particular to ensure the balanced representation of women and men on those boards

Status

Dead, as of Oct. 25, 2016

Subscribe to a feed (what's a feed?) of speeches and votes in the House related to Bill S-207.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment requires the following corporations to ensure that the proportion of directors of each sex on their board of directors is not less than 40 per cent and that shareholders may vote against a candidate for a director’s position:

(a) a distributing corporation within the meaning of the Canada Business Corporations Act, any of the issued securities of which remain outstanding and are held by more than one person;

(b) a bank that is listed in Schedule I to the Bank Act;

(c) a cooperative credit association regulated by the Cooperative Credit Associations Act;

(d) a distributing company regulated by the Insurance Companies Act;

(e) a distributing company regulated by the Trust and Loan Companies Act; and

(f) any other federally regulated, publicly traded corporation.

The parent Crown corporations listed in Schedule III to the Financial Administration Act are subject to the same obligations as incorporated companies, except with regard to the right to vote against a candidate for a director’s position.

The enactment provides that the obligation relating to the balanced representation of each sex takes effect incrementally, at the end of three-year and six-year periods. If the new obligation entails changes to a company’s by-laws or incorporating instrument, then the three-year deadline may be extended by one year.

In order to enforce compliance with these obligations, the enactment invalidates elections held or appointments made in violation of its provisions and makes compliance a condition for the issuance of a certificate or letters patent or for the exercise of the powers necessary for the implementation of certain processes or certain proposals or amendments.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Canada Business Corporations ActGovernment Orders

November 25th, 2016 / 1:10 p.m.
See context

NDP

Sheila Malcolmson NDP Nanaimo—Ladysmith, BC

Mr. Speaker, I will start by indicating that I will be splitting my time with my colleague, the member for Regina—Lewvan.

We just went through an American election that disparaged women's leadership. I would like to see Canada and all Canadian parliamentarians send a strong message about the important role of women in leadership.

Last week I was really proud when the New Democratic caucus arranged an all-women's question period lineup the first day after the U.S. election. We wanted to promote women in politics and make sure that we were showing that women who are elected take their voice and are given a voice and fight back against the sexist notions we heard throughout the U.S. election.

Women are still under-represented within our country's decision-making bodies in every area. We have a lot of work to do in that regard.

Talking today about board of director appointments, only 27% of members of boards of directors of crown corporations, agencies, and commissions across our country are women. Those are appointments the federal government has an exclusive responsibility to make, and it is not providing appointments to those boards of directors that actually reflect the diversity and gender makeup of our country.

New Democrats are proposing concrete action to ensure the equality of men and women in many areas, but in this case on crown corporation and federal commission boards. My private member's bill, Bill C-220, is an act to amend the Financial Administration Act with respect to balanced representation. It aims for gender parity in crown corporation and federal commission appointments within six years of its adoption.

This bill has been introduced by a number of New Democrat members of Parliament over the years, such as the member for London—Fanshawe, and most recently, former MP Anne-Marie Day. It was defeated by the Conservatives but supported by both the Liberals and New Democrats when it was debated and voted on in 2014.

When we have appointed women to crown agencies, we have had some great successes. Last night we were meeting with the board of directors of VIA Rail, which has gender parity on its board. Its chair is a woman who is a fantastic proponent of this very important public service. Very recently, in my own community in Nanaimo, Erralyn Thomas was appointed to a local government commission, the Nanaimo Economic Development Corporation. Erralyn Thomas is an elected Snuneymuxw First Nation councillor. I am very glad to see her take that leadership role in my community.

The Nanaimo Port Authority has a majority of female board members. I love telling the story of how this happened, because it is a bit outside the norm. We have the Laurentian Pilotage Authority, which I believe has zero women. That is another federal agency. However, the Nanaimo Port Authority has a majority of women.

I asked the, at the time, male chair of the board how this came to be. He said that the transport minister of the day, who sits in this House but now on the Conservative side, refused to approve any of the appointments being proposed by the Nanaimo Port Authority for its board of directors until it had some women in its pile of recommendations. It finally got the message. It proposed strong women in our community—engineers, accountants, community leaders—and I would argue that as a result of having appointed a gender-balanced board, the Nanaimo Port Authority meshes much better with the community of Nanaimo. It has better community relations. It is actually prioritizing relations with area first nations in a way it has not before.

We do well when our federal boards and commissions actually reflect the diversity of our country. When we prioritize gender-balanced appointments, we find those good candidates who have not been appointed up to that point.

The problem with this approach is that it relies singularly on the good intentions of the responsible person of the day, in this case a former Conservative transport minister, who asked me not to name her, because she thought she would sound like a New Democrat. I think I just did.

The same goes for the Liberal appointment of a gender-balanced cabinet. I applaud that, but that was at one point in time. There is nothing that actually benefits women on the ground. There is nothing that sets in stone that appointments in the future, at any level, will actually be gender balanced.

A significant failing of this bill we are now debating is that it makes no reference to federal crown appointments.

I am going to try to convince this House that the federal government would be more effective telling co-ops, corporate boards, and the business community to appoint gender-balanced boards of directors if it actually got its own house in order first and did its own homework on the decisions being made right at home.

This was a Liberal government commitment. They are expected to do their part to fulfill the “government's commitment to transparent, merit-based appointments, to help ensure gender parity”. That is in the mandate letter to the Minister of Status of Women. The Prime Minister asked for support for the Privy Council Office “as it develops monitoring and reporting processes to ensure that the government's senior appointments are merit-based and demonstrate gender parity”.

In a late show debate last week, the Parliamentary Secretary for Status of Women said that there are 4,000 Governor in Council and ministerial appointments to commissions, boards, crown corporations, agencies, and tribunals across the country coming up. However, although we were in a debate about gender equality, she said nothing about whether they actually were making those appointments in a gender-balanced way.

We asked the Library of Parliament. There were no stats at all on whether those appointments are being made in a gender-balanced way. I have asked the Minister of Status of Women in correspondence and have not had any answer.

We know this is a direction and a commitment of the government. We want to see it realized. It is badly needed. We have a number of crown agencies that have either no women or hardly any women.

There has been great reporting by Metro News on this recently here in Ottawa. They named, for example, the Bank of Canada, the Canadian Dairy Commission, Canada Mortgage and Housing Corporation, the National Capital Commission, and the Canadian Air Transport Security Authority as having none or few women on their boards. That is an embarrassment in 2016, or actually in any year.

Bill C-25 purports to address issues of gender parity and shareholder democracy, but it does not get its own house in order first. It makes no reference to federal appointments. There is a Senate bill, Bill S-207, the boards of directors modernization act , which is actually much more in line with the New Democrat approach. It does propose a direction and legislation on crown appointments being gender balanced. We applaud the Senate for going further than the government is.

I will finish with some criticism of the Bill C-25 approach. The “comply or explain” model, which is being relied on in this legislation, has been described by the Canadian Board Diversity Council as “not leading to meaningful disclosure and a consistent improved pace of change”. It notes “a growing sentiment that quotas may be necessary to bring about the desired change”.

Canada continues to lag behind other countries when it comes to women in leadership positions. The Liberal government, we are sad to see, seems content to apply the same aspirational targets and models that have not worked that the Conservative government had. I am dismayed to see the similarity of an approach that did not work under the Conservative government. Why would it be any different under the Liberal government?

This is only the second time in 40 years that Canada has addressed the issue of corporate governance. This is not a bill, in my view, that represents #realchange. It falls short in many respects.

In closing, we will be better as a country, our governance will be better, if our decision-making bodies better reflect the diversity and strength of our country. We would very much like to see this bill amended to incorporate the elements of my private member's bill, Bill C-220, which would get at the requirement to have gender-balanced federal commission appointments. The government should take the power it has and make the appointments it has the sole responsibility for. This should be a priority. It would be a true action that would implement the government's feminist rhetoric.