CSA Initiate Consultation Process On Proxy Voting Infrastructure

Citing the importance of proxy voting to the capital markets in Canada, the Canadian Securities Administrators today published for comment a consultation paper setting out a proposed approach for addressing concerns regarding the integrity and reliability of the proxy voting infrastructure.

In considering the reasoning behind addressing proxy voting, the CSA identified a number of factors that contribute to the complexity of proxy voting and vote reconciliation, specifically the intermediated system of holding securities that supports clearing and settlement, securities lending, the use of voting agents by investors and the right of investors to not disclose their identities.

Ultimately, the CSA identified two main issues for examination. First, the CSA questioned whether accurate vote reconciliation is occurring within the proxy voting infrastructure. On that point, the CSA noted that the intermediated holding system resulting in one share having multiple