TSX - Skirting The Rules No Longer

TSX provides guidance on the use of "exceptional circumstances" in issuer majority voting policies

On March 9, 2017, the Toronto Stock Exchange (TSX) issued Staff Notice 2017-001 (the Staff Notice), which provides guidance on the TSX's majority voting requirement and the use of advance notice policies for director election requirements. Significantly, for many issuers, the Staff Notice outlines the TSX's expectations for the use of an "exceptional circumstance" to reject the resignation of a director that is not elected by a majority of votes cast (a Subject Director).

Majority Voting Requirements

The Staff Notice results from the TSX's experience from the 2015 and 2016 proxy seasons and its recent review of the majority voting policies of 200 TSX-listed issuers for compliance with subsection 461.3 of the TSX Company Manual (the Manual). This review revealed certain deficiencies which led the TSX to clarify the expectations surrounding majority voting policy