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23 April 2010

Trevor Scott and Peter Roth Release Bulletin on Shareholder Activism in Canada

Over the past decade, there has been a marked shift away from the traditional corporate standard of director primacy, based on the concept of separating ownership and control of a corporation, towards increased activism by shareholders desiring greater influence over the governance and stewardship of a corporation. Since the financial crisis of 2008, shareholders have put particular emphasis on director accountability and executive compensation practices. Shareholders have achieved increasing success at influencing operations and policies of corporations using a variety of means, ranging from direct and ongoing interaction with management and boards, to shareholder proposals and voting campaigns, to full out proxy battles for control over boards. Adding to the increased sophistication and aggressiveness of recent shareholder activism has been the emergence of key third party players such as proxy advisory firms and institutional shareholder advisory groups - the former having gained prominence based on expertise of the proxy solicitation process and the analysis of, and communications with, a corporation’s shareholder base and the latter having gained prominence based on the reliance that institutional shareholders place on their researched voting recommendations on matters put before shareholders.

This article explores three “hot” issues related to director accountability and executive compensation that have gained recent prominence in Canadian shareholder activism: majority voting, slate elections, and shareholder say on pay. Prior to exploring these issues, the tools used by shareholder activists and the different motivations of shareholder activists are discussed.

To read the Corporate Bulletin, please see the attachment below: 
TRS_and_PMR_Shareholder_Activism_in_Canada_(CCCA_Spring_2010_Training).pdf

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