May 26, 2015
Torys’ annual publication, Capital Markets Mid-Year Report 2015, features “Women in the C-Suite: Can Securities Law Advance Gender Equality?”—an analysis of how public companies in Canada have responded to new gender diversity rules that have come into effect this year. Partner and co-head of the Capital Markets Practice, Rima Ramchandani, discusses the impact of the rules for a Globe and Mail article covering the highlights of our study. Below is an excerpt of the article.
A review of proxy circulars filed this year shows 56 per cent of companies in Canada’s S&P/TSX composite index have adopted policies to address the representation of women on their boards, while 44 per cent have no policies. Most of the policies were developed over the past year after Canadian regulators announced new guidelines requiring companies to report annually on their approach to improving gender diversity on their boards or explain why they have no policies, according to the study by law firm Torys LLP.
Lawyer Rima Ramchandani of Torys, who co-authored the report with two colleagues, said that while regulators hoped the policy would spur a large majority of companies to adopt diversity plans, some are still working on new board policies or are waiting to see how their peers respond.
“I would have thought we would have seen more, but I do think it’s early days and I suspect next year and in a few years there will be an increase in that number,” Ms. Ramchandani said… “The rules require that you measure your progress in achieving the targets, so there’s a general feeling that we don’t want to set aspirational or stretch targets without doing a deep enough dive that we feel confident we can meet them,” she said…
The Torys review looked at 179 companies in the S&P/TSX index that had filed their 2015 proxy circulars as of May 10, which accounted for 71 per cent of the index. The study did not provide details for individual companies or break down companies by industry sector, but it separately looked at nine Canadian financial institutions including major banks, which have Oct. 31 fiscal year-ends and did not have to comply yet with the new disclosure rule.
“The advantage of these new rules is that they really force the board and the governance committee to actively think about this and put it on the agenda,” Ms. Ramchandani said. “It was on the agenda for some previously, but now it becomes something they have to talk about every year at least.”
For a sneak peek at “Women in the C-Suite: Can Securities Law Advance Gender Equality?” by Rima Ramchandani, Glen Johnson and Michele Cousens, click here to download the PDF. The complete Capital Markets Mid-Year Report 2015 will be released June 16.