Canadian companies have an "unacceptable" track record for disclosing their corporate governance practices and many do not comply adequately with regulatory requirements, securities regulators have concluded.
The Canadian Securities Administrators, an umbrella organization of provincial securities commissions, said Thursday it has completed a review of 72 companies' shareholder proxy circulars to assess how well they are meeting requirements to disclose their board's governance practices.
While no companies were required to refile their documents, the CSA said 55 per cent of those assessed were told to make improvements in the future to their disclosure.
CSA chairman Jean St-Gelais said the review is intended "to be an educational tool" to assist companies in improving their disclosure.
Some of the most common deficiencies identified in the review included failing to explain the reasons why a director on a board was considered to be non-independent, and failing to explain in detail how many meetings of independent directors were held in the prior year without management present.
The CSA also said companies did not offer specific details about how new directors were trained for their jobs, or did not provide detailed information about continuing education for directors. The CSA said there were also "significant disclosure deficiencies" in describing the process used by the board to identify new director nominees.