Bill C-25 - A Catalyst For Corporate Diversity In Canada?

After a long journey through the legislative process, Bill C-25, which amends the Canada Business Corporations Act (CBCA), together with the Canada Cooperatives Act and the Canada Not-for-profit Corporations Act, received Royal Assent on May 1, 2018. The amendments to the CBCA, once in force, will affect federally incorporated companies in three main areas: director elections, shareholder communication and diversity disclosure. This blog post provides an overview of the first two areas, but primarily focuses on diversity disclosure.

Director Elections

A significant amendment to the CBCA implements a mandatory majority voting regime for public companies incorporated under the CBCA. The new regime allows shareholders to vote against the election of a director nominee (as opposed to merely withholding a vote), meaning that a director who does not receive a majority of the shareholder votes in an uncontested election will not be elected.