Thank you very much, and good afternoon.
I'll just start out with a quick note, and an apology, which is that I am going to be referring to a slide deck, but through some kind of miscommunication, we don't have the copies as yet. Somebody is on their way with copies. So I'll make sure that my remarks are self-explanatory. I apologize for that.
Just to expand on your introduction, my responsibility at Industry Canada is as director general for marketplace framework policy. That's my title. I'm responsible for the policy behind the Canada Business Corporations Act.
I am joined by Wayne Lennon, who works with me in the branch. Also joining me is Cheryl Ringor, director of compliance and policy, and a deputy director under the CBCA. Both she and Coleen Kirby, the manager of the policy section at Corporations Canada, are really the feet on the ground, the actual administrators or folks who are in charge of actually making the statute work.
That said, we are here today to help the committee and to answer any questions that you may have. My colleague, Ms. Ringor, and I will start with a brief presentation, which will speak to the provisions in the Canada Business Corporations Act, the amendments that were made in 2001 and the implementation of the act.
Just by way of initial background, corporate law provides a framework for the creation and governance of corporations, by defining rights and responsibilities of the corporation and its shareholders, directors, and managers. It also provides rules around disclosure and transparency, conflict of interest, and the way corporations interact with third parties, just as examples.
The corporate governance framework in Canada is complemented by provincial securities laws, which apply to the way securities markets work and the rules around the operations of those markets. Obviously, a well-managed corporate framework in Canada benefits Canadian society as a whole. It's a fundamental ingredient to increasing Canadian economic prosperity by doing things such as providing certainty to attract investment; to increase our competitiveness as a place to invest; and to assist in the development of innovation—again because it provides that certainty.
Our corporate governance framework is recognized internationally. Delegations from a number of countries have visited Canada specifically to learn more about how the CBCA works, with a view to including some of its features in their own governance framework.
In terms of our framework being recognized internationally, the World Bank's Doing Business 2009 and 2010 ranked Canada second as a place for starting a business--New Zealand was first-- and eighth for ease of doing business, behind Singapore, New Zealand, the U.S., Hong Kong, Denmark, the U.K., and Ireland. The World Economic Forum's Global Competitiveness Report for this year ranked Canada fourth for efficiency of corporate boards of directors and eighth for the protection of minority shareholder interests. In both cases, obviously, a number of factors went into the ranking. It wasn't all about the CBCA, but certainly the CBCA was an important ingredient in those rankings.
Created in 1975,
In Canada, the CBCA has been considered a leading-edge statute in corporate law and has served as the basis for provincial corporate law legislation and implementation. One of the act's main objectives is to balance the interests of corporations and their directors against those of shareholders and creditors, all the while deflecting an unnecessary burden.
So the main objective of the law is to permit the efficient administration of the act while balancing the interests of management, shareholders, and creditors of federal corporations. It contains little administrative discretion, again, to provide that certainty that I referred to before. It does provide some flexibility through regulations and for detailing rules. It provides a comprehensive regime of shareholder remedies.
It is a framework statute, as I mentioned earlier, that also provides for the creation and dissolution...all kinds of reorganization in between federal business corporations. It sets out the basic features and structures of a corporation, establishes corporate governance standards, codifies principles of transparency and accountability, and provides a framework for the interaction of various interested parties, directors, management, shareholders, and creditors. It is not prescriptive about the way that a corporation runs its internal and external business. It actually facilitates the ability of a corporation to arrange those structures in the ways that it sees fit and to adapt as the economy and as the business adapts over time.
Perhaps I'll pass it over to you now, Cheryl.