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Proxy Advisors and Shareholders Pay Attention to Cybersecurity; Boards Should Too

By The Special Situations Team on Posted in Uncategorized
Proxy advisors and shareholders are paying an increasing amount of attention to cybersecurity because the stakes are high – a cyberattack can be catastrophic for a company. A successful cyber attack can target confidential information integral to the competitive edge of a business (including trade secrets, supplier and client lists, information regarding research and development … Continue reading

CP Rail Supports an ESG-Related Shareholder Proposal Which Includes Annual Advisory Vote by Shareholders on a Climate Action Plan

Photo of Heidi ReinhartBy Heidi Reinhart and The Special Situations Team on Posted in Corporate Governance, Shareholder Activism
TCI Fund Management Limited (TCI) recently successfully submitted a climate change-related shareholder proposal (the Proposal) to Canadian Pacific Railway Limited (CP) to be voted on at CP’s upcoming 2021 annual general meeting of shareholders.  As stated in its circular for the meeting, CP supports TCI’s Proposal and recommends shareholders vote in favour of it.  Of … Continue reading

Dialing In: Adapting to Virtual Shareholder Meetings

By The Special Situations Team on Posted in Corporate Governance, Securities
The Shift to a Virtual World The COVID-19 pandemic has altered and changed many familiar corporate operational and governance practices and norms, including how issuers host their annual general meetings (AGMs). Broadridge Financial Solutions reported hosting 300 virtual meetings in 2019 and approximately 1500 virtual meetings this year thus far. In place of in-person only … Continue reading

Global Trends in Shareholder Activism Amidst COVID-19

By The Special Situations Team on Posted in M&A, Shareholder Activism
According to a review of shareholder activism by Lazard (the Lazard Review) that examined global activism trends in the first half of 2020 (H1 2020), economic uncertainty brought on by the COVID-19 pandemic, coupled with heightened awareness of widening socioeconomic inequalities around the world, has altered shareholder activism activity globally. We highlight some important trends … Continue reading

Shareholder Activism Reaches Record Levels

By The Special Situations Team on Posted in Corporate Governance, Proxy Battles, Shareholder Activism
Activist Insight recently published the sixth edition of its annual report, entitled “The Activist Investing Annual Review 2019” (the “Review”). The Review analyzes recent global shareholder activism trends, forecasts expected developments in 2019, and highlights and compares jurisdictional data. Oh, Canada: Increased Canadian Activism As the Review outlines, 2018 was a notable year in Canada … Continue reading

Is Governance Going Green? The Influence of Environmental and Social Issues on Corporate Governance and Investing

By The Special Situations Team on Posted in Corporate Governance
With the heightened awareness of climate change, wage disparities, gender inequality and the like, the effects of these and other environmental and social (E&S) issues are widespread, extending as far as topics like corporate governance and investing. In fact, in its report entitled “2018 Canadian Proxy Season Review” (the Review), Kingsdale Advisors (Kingsdale) notes a … Continue reading

Global and Canadian Trends of Corporate Governance in 2019 and Beyond

By The Special Situations Team on Posted in Corporate Governance
Recently, public company boards are facing increasing scrutiny and greater expectations from various stakeholders, particularly in light of society’s elevated concerns regarding corporate culture, gender equality and climate change and sustainability. In its report entitled “2019 Global & Regional Trends in Corporate Governance” (the Report), Russell Reynolds Associates noted that in 2019 “[t]he demand for … Continue reading

Implications of the Collaborative Model of Corporate Governance

By The Special Situations Team on Posted in Corporate Governance
In a recent paper, Jill Fisch and Simone Sepe outline a new model for corporate governance: the Insider-Shareholder Collaborative model. A Shift Towards Collaboration Two models have previously dominated the corporate governance discourse: (i) the management-power model and (ii) the shareholder-power model. The former emphasizes a board’s decision-making authority as the corporation’s essential coordinating and … Continue reading

Exploring the Link between Gender, Governance, and Shareholder Activism

By The Special Situations Team on Posted in Corporate Governance, Shareholder Activism
A study conducted by global consultancy firm Alvarez and Marsal (A&M) showed that companies with more women on their boards attract fewer activist investors. In particular, the study, which surveyed 1,854 public groups, revealed that companies not targeted by hedge fund activists had on average 13.4 per cent more women on their boards. Despite being … Continue reading

The Gender Question: BC Securities Commission asks for comment on disclosure requirements with respect to board gender diversity

By The Special Situations Team on Posted in Compliance, Corporate Governance, Shareholder Activism
In late 2014, the Canadian Securities Administrators (CSA) published “comply or explain” rules regarding female representation in director and executive officer positions. The requirements were codified in National Instrument 58-101 (the Disclosure Requirements) and created a positive duty for issuers in participating jurisdictions to disclose the details of female representation, including issuers’ targets, policies, and … Continue reading

Trends in Environmental Social Governance

By The Special Situations Team on Posted in Corporate Governance, Securities
Corporations are facing increasing pressure to offer more transparency and disclosure with respect to their governance practices that promote environmental and social sustainability. This year’s trends in Environment Social Governance (ESG) in the context of Canadian corporate governance indicate that more and more corporations are including ESG as part of their core mandates and that … Continue reading

Glass Lewis’ 2018 Canada Policy Guidelines on Proxy Advice

By The Special Situations Team on Posted in Corporate Governance, Proxy Access, Proxy Battles, Shareholder Activism
Glass, Lewis & Co., LLC (Glass Lewis), a leading governance and proxy voting firm, has recently released its 2018 Policy Guidelines for Proxy Advice in Canada.  The following are three of its key changes from the 2017 Policy Guidelines: Board Gender Diversity In the new year, Glass Lewis will not make voting recommendations solely on the … Continue reading

Management diversity: will targets and quotas improve gender diversity?

By The Special Situations Team on Posted in Corporate Governance
On October 5, 2017, the Canadian Securities Administrators (CSA) released Staff Notice 58-309 (Staff Notice) reporting findings of a review carried out by various Canadian securities regulators of disclosure regarding women on boards and in executive officer positions by TSX issuers, as prescribed in National Instrument 58-101 Disclosure of Corporate Governance Practices. We previously reported … Continue reading

Investors heating up the conversation on climate change

By The Special Situations Team on Posted in Corporate Governance, Shareholder Activism
Shareholders are placing increased value on non-financial factors when making investment decisions. Some of these factors are environmental and social issues. In particular, shareholder proposals on climate change have recently gained some traction. In 2016, a record breaking number of climate change resolutions were filed. This shift in focus is attributed to the 2015 Paris … Continue reading

Alberta Securities Commission declines to exercise public interest jurisdiction to terminate soliciting dealer arrangement in proxy fight

Photo of Linda FuerstBy Linda Fuerst and The Special Situations Team on Posted in Litigation, Proxy Battles
In its recent PointNorth Capital Inc. decision, the Alberta Securities Commission (ASC) was called upon to consider the appropriateness of a soliciting dealer arrangement that had been entered into by the issuer, Liquor Stores N.A. Ltd., in the context of a proxy fight. The arrangement was intended to address management’s constrained ability to solicit proxies … Continue reading

Court dismisses petition for a court-ordered shareholders meeting with independent chair in lieu of a meeting requisitioned by shareholders

Photo of Andrea BrewerBy Andrea Brewer and The Special Situations Team on Posted in Uncategorized
In a dispute between three petitioning directors (the Petitioners) and three requisitioning shareholders (two of whom were also directors) (the Requisitioning Shareholders) of Photon Control Inc. (Photon) (TSX-V: PHO), the Petitioners asked the British Columbia Supreme Court (the Court) to exercise its powers under the Business Corporations Act (British Columbia) (the Act) to intervene in … Continue reading

An age of shareholder empowerment

By The Special Situations Team on Posted in Corporate Governance, Shareholder Activism
In a corporate directors survey (the Survey) entitled “The swinging pendulum: Board governance in the age of shareholder empowerment”, PricewaterhouseCoopers LLP (PwC) presents current trends in investor influence and their impact on governance practices of boards and management teams. Conducted amongst 884 company directors in the summer of 2016 with respondents representing over 24 industries, … Continue reading

Activists increase their focus on smaller issuers

By The Special Situations Team on Posted in Shareholder Activism
Shareholder activism is often associated with campaigns involving large, high-profile issuers. Yet as the Financial Times reports in a recent article, referencing global data from Activist Insight, there has been a slight upswing this year in activism against relatively small issuers. The data show that from the start of year to the end of July, … Continue reading

Majority voting and board diversity trends

By The Special Situations Team on Posted in Corporate Governance
As recently highlighted in the Harvard Law School Forum on Corporate Governance and Financial Regulation, a report (the Report) by Institutional Shareholder Services (ISS) found that majority voting practices and annual board elections, along with increases in board diversity, are the new norm. The Report examined the public filings of Standard & Poor’s U.S. “Super … Continue reading

The State of Proxy Access Reforms

By The Special Situations Team on Posted in Corporate Governance, Proxy Battles
With the rise of shareholder activism led by what some refer to as “constructivists”, “reluctavists” or “suggestivists” (and, yet others, those who commit “extortion”), shareholders have become increasingly distrustful of leaving matters of corporate governance to management and boards. One tool that investors can rely on is exercising rights pursuant to a proxy access by-law, … Continue reading
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