CSA Provides Update On Review Of Proxy Voting Infrastructure

In June 2012, the Canadian Securities Administrators (CSA) sought comments from market participants on Consultation Paper 25-401 Potential Regulation of Proxy Advisory Firms (Consultation Paper). The CSA has provided an update on the comments it has received on the Consultation Paper.

Of concern to the CSA is the integrity of the proxy voting system, in particular its transparency, accuracy and the potential for conflicts of interest.

The comments received show that opinions are generally divided between two camps: issuers, issuer related associations and law firms in one camp, and institutional investors and related associations in the other.

Issuers were of the opinion that while proxy advisory firms are important, they expressed concern over the influence such firms may have on the voting patterns of institutional investors; whereas institutional investors saw proxy advisory firms as useful and cost effective and the institutional investors noted that they did