Director independence depends
|Area||Corporate Finance and Securities|
Article originally published in the Canadian Lawyer Magazine, January 2018
Excerpt from "Director independence depends":
Independence is a central element of the regulatory framework for corporate governance. The regime (i) recommends that the chairperson of the board, a majority of the directors of the board and a majority of the nominating and compensation committees of a reporting issuer be independent and, for issuers other than venture issuers; (ii) requires that the entire audit committee be independent; and (iii) requires that disclosure be made in the issuer’s annual proxy materials regarding the basis for the board’s conclusions as to its members’ independence. It is almost as if the regime is a harsh drinking game for securities lawyers, requiring consumption of a shot for each (frequent) mention of the concept of independence. And now independence is topical again because the Canadian Securities Administrators recently published a consultation paper inviting a reconsideration of the securities regulatory approach to the concept.