Mr. Speaker, I appreciate the opportunity to participate in today's debate and want to thank the hon. member for bringing this matter to the attention of the House.
As many of my hon. colleagues know, the government has made bolstering investor confidence in Canadian corporate governance regimes a priority. Public confidence in capital markets and our public companies is critical to a well functioning economy.
Canada has a strong tradition of fostering sound corporate governance. With the Toronto Stock Exchange's leadership, Canada was among the first countries to systematically study ways to improve corporate governance and implement comprehensive governance guidelines. In July, the Minister of Finance continued, and outlined five areas for action to bolster investor confidence: first, improving financial reporting; second, enhancing further the credibility of the audit processes; third, strengthening corporate governance; fourth, ensuring management accountability; and last on the list was toughening the enforcement process.
The government is pleased with the cooperation demonstrated to date by the federal and provincial regulators and the private sector to implement an appropriate Canadian response to the issues highlighted by the recent U.S. corporate scandals.
Considerable progress has been made. Let me provide some examples. As my colleague pointed out, first, the new Canadian public accountability board for public company auditors has been established to help ensure the credibility of the audit process. It will provide oversight of public company auditors and has the power to impose sanctions. The Canadian Institute of Chartered Accountants has drafted new rules for auditor independence, due to be finalized by the end of this year. The Toronto Stock Exchange has announced new measures to enhance corporate governance practices at companies listed on the TSE. Ontario and Quebec have tabled legislation that will expand the powers of their securities commissions and increase penalties for securities violations. The Department of Finance is maintaining an up to date record of recent actions on its website.
Just recently, the International Monetary Fund noted that Canada has been “commendably proactive in strengthening corporate governance and preserving investor confidence”. However, more needs to be done. Industry Canada and the Department of Finance are examining federal corporate law and financial institution statutes to assess whether changes are necessary to improve corporate governance practices in Canada.
The government is also reviewing the criminal law framework and the effectiveness of enforcement related to corporate fraud. In addition, the Senate Committee on Banking, Trade and Commerce is examining the issues surrounding the collapse of Enron and other large corporations.
I hope my remarks have helped to address the hon. member's concerns.