Industry Committee on Feb. 9th, 2017

[Paul Schneider]

Again, I think it's important for directors to be held accountable. I think if directors are doing their job, then they should hold themselves accountable on an annual basis. In my job, I hold myself accountable all the time, on an annual basis. I don't see any real difference. If directors are doing their job, I think they should have nothing to worry about.

[Majid Jowhari, Liberal, Richmond Hill, ON]

That's as long as they understand the long-term vision and they're doing their job in a satisfactory manner.

[Paul Schneider]

We expect them to have a long-term vision. We encourage that, and it's something we want them to have.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Great. Thank you.

I think my five minutes are up.

[The Chair, Liberal, Dan Ruimy]

You have one minute, actually.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Let's go to beneficial ownership. I think Paul talked about beneficial ownership.

[The Chair, Liberal, Dan Ruimy]

You now have 30 seconds.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Then I'll pass the 30 seconds to whoever is next.

[The Chair, Liberal, Dan Ruimy]

Thank you very much for that.

[A voice]

You owe us.

[The Chair, Liberal, Dan Ruimy]

We're going to jump to Mr. Dreeshen.

You have five minutes.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you very much, Mr. Chair. I'll share some of my time with my colleague Mr. Nuttall.

Earlier, when we were talking, I had wanted to get into the concept of the bearer shares, and Mr. Baylis had indicated that was significant.

Paul Lalonde, could we perhaps go through that? You were stating that any of these bearer shares should be converted into a registered share.

Proposed subsection 21.9(2), under the heading “Replacement”, states:

A corporation shall, on the request of a holder of a certificate, warrant or other evidence of a conversion privilege, option or right to acquire a share of the corporation that is in bearer form and that was issued before the coming into force of this section, issue in exchange to that holder, in registered form, a certificate, warrant or other evidence, as the case may be.

Is there a difference in the registered form as a certificate, a warrant, or something else? Is the registered share just a catch-all term that we use as it goes from one to the other? How do you see that?

When I look at the concept of a bearer share, I realize the rationale and the reason it's important to try to get some clarity to see where you're going. I wonder if you could explain that for me, please.

[Paul Lalonde]

A bearer share is like cash. Whoever is in possession of it owns that cash. A bearer share is the same way. There's no individual to which it's issued. If you hold it, if you possess it, you have the rights that attach to that share.

A registered share is a little bit different. It's issued to a specific person, and there are records that confirm that. For example, 25 shares were issued to Ms. So-and-so at such-and-such a time. It's not just a question of the possession of the shares; there is a registered record of who owns the shares, which is not the case in bearer shares.

The section that you referred to is interesting in that it provides for turning a bearer share into a registered share at the request of the holder of the bearer shares.

That's all fine, but what we're saying is that there should be other triggers that turn bearer shares into registered shares, so that over time, bearer shares that were issued before the modifications get flushed out and turned into registered shares.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

In those circumstances, are there some potential amendments that you think could make that stronger or clearer?

[Paul Lalonde]

Yes. In the paper that we gave to the clerk of the committee, we made specific recommendations about two specific trigger events that we think should be added to the legislation to turn bearer shares into registered shares. I talked about it in my discussion with Mr. Baylis.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you very much.

I'll give my time now to Mr. Nuttall.

[Alex Nuttall, Conservative, Barrie—Springwater—Oro-Medonte, ON]

Thank you, Mr. Chair.

I would like to table a motion which I am acutely aware we can't debate today, but with it I'll give a slight preamble.

Sometime in December, the innovation report from the innovation leaders was tabled. Unfortunately, none of us got the report, but it's out there.

Previously I've requested that we have the innovation leaders here. Now that they have produced a report, I can't think of a reason we wouldn't invite them here.

Do I need to read the motion out? It's in writing.

[The Chair, Liberal, Dan Ruimy]

Please do.

[Alex Nuttall, Conservative, Barrie—Springwater—Oro-Medonte, ON]

Here is the notice of motion I submitted on Thursday, February 9, 2017.

I move:

That the Standing Committee on Industry, Science and Economic Development of the House of Commons undertake a study (of no more than two meetings) on the recommendations of the 'Innovation Leaders' as outlined in their paper "Innovation for a Better Canada; What We Heard."; and that the committee invite the ten 'innovation leaders' to appear as witnesses.

I will leave it there. Obviously we can't debate it today, but I hope we can do so in upcoming meetings.

Thank you, Mr. Chair.

[The Chair, Liberal, Dan Ruimy]

The clerk has received the notice of motion. Thank you very much.

Okay, you're done.

Mr. Masse, you have the last five minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

I haven't forgotten about you. I was interested in your testimony and the analysis that was done. When I had a real job, I was an employment specialist for new Canadians, for persons with disabilities and youth at risk. Basically, I'd open up the doors and get jobs and so forth, and I'd literally have employers say, “Well, I'll take the person with the disability for an interview, but they can't be this,” or “We'll consider one of your youth at risk, but don't give us somebody from this country or with this colour.” I literally had those questions. Apparently one of the benefits of being a white male is that at times you get inappropriate information that it is thought can be spread to you.

Regardless, you've taken the position that the minister did note it, but the reality is that's just a commitment from the minister. There's nothing binding about it.

Therefore, what do we do and how long do we wait before we see any types of things...? Should there be penalties or anything on...? For example, you cited Montreal, a good example where we have the evidence that it works. It's all there in front of everybody. They're choosing not to do it; that's what is happening. If they're not doing it, given that it's making money and it's complying with a number of different things for them. I'd like them to choose my lottery numbers. There's just no way you can avoid the success that's been seen, and they're still not doing it, so what do we do? Do we wait for another 40 years?

In this legislation, I'm going to be proposing a mandatory review as one of the things that should be done. That's normal, especially for updated legislation. What should we do if we're not going to go with a target, or is there a potential for a medium target to be set, or an aspirational target? What do we do if no compliance by certain companies is taking place?

[Prof. Wendy Cukier]

It's a really good question.

I like your idea of a mandatory review. I hadn't thought about that, but that's certainly something that's done in other contexts.

Having worked in this field for over 25 years, I would say that of course there are some cases of over-discrimination, and we've seen some horrible examples in recent weeks, which I don't need to remind you of. However, a lot of it is unintentional. The research shows that there's unconscious bias, that often people gravitate towards people who are like them. That's just the way things are, and it's part of the reason that a lot of the very powerful women's organizations have just focused on gender diversity and haven't noticed that they're in rooms that are not very diverse when you think about those other issues.

I believe that information is important, but I still think there are lots of companies that don't get it. I have a real commitment to innovation processes and everything we know about social innovation being applied to this area. Your legislation is critically important, but there are other things you're doing with work-integrated learning and by trying to attract direct foreign investment to create jobs, like GE in Welland. There are all sorts of instruments that government has right across the board to potentially incentivize this kind of behaviour, and I think that's a more productive strategy, because we risk backlash if we're too heavy-handed on this, in my view.

[Brian Masse, NDP, Windsor West, ON]

Yes, there can be backlash, but I don't think it's just like that in terms of providing information. I still think there's an ingrained aspect.

To be quite frank, look at this committee. My colleague from the Liberals raised a point about the equity here. The NDP caucus is 44% women, and we have an equity policy that actually drives part of the thing. Then we have a Prime Minister who is a self-declared feminist, yet we have a committee here that doesn't have any women—

[Prof. Wendy Cukier]

I think he put them all in cabinet.

[Brian Masse, NDP, Windsor West, ON]

—except for a parliamentary secretary who is dutifully here when she can be. These things just don't happen by accident. This is not happening by accident; this is really what's taking place here.