Key Issues For Boards Of Directors In 2019

The role of directors is more challenging than ever given increased volatility and competitive pressures in the business environment coupled with a legal framework that is imperfectly aligned with demands made by increasingly active shareholders and other stakeholders.

Here are eight issues that directors should keep in mind in 2019:

1. Shareholder Engagement

Boards and management have to engage with shareholders and be responsive to their concerns, both because their tenure depends on maintaining the confidence of shareholders and because shareholders have been empowered through greater voting rights as a result of recent corporate governance reforms (e.g., majority voting, say-on-pay). Those concerns are often driven by short-term shareholder value maximization imperatives. Engagement with the shareholder base is appropriate and beneficial: it provides valuable input and protects against distracting and expensive fights. However, under Canadian law, boards, in