New disclosure requirements designed to encourage greater representation of women on corporate boards and among senior management have been approved in Ontario, and are due to take effect by the end of the year.
The Ontario government announced Tuesday that it has approved rule changes that require public companies to make disclosures about their approach to gender diversity, by requiring them to reveal: the number of women on their board and in senior management; their policies regarding the representation of women on the board; the board, or nominating committee's, consideration of the representation of women when selecting directors; and, corporate governance policies, such director term limits, to ensure board renewal.
The new amendments "will promote a proactive approach" to improving gender diversity, the government says, through a ‘comply or explain' model, rather than setting quotas. The rule changes will come into force on Dec. 31, in time for 2015 annual reporting season.
"Enhancing gender representation on companies' boards and in senior management teams will not only make corporations more productive, it will also help attract new investment and grow our economy. Greater gender diversity on corporate boards will contribute to a stronger Ontario economy, said Charles Sousa, Ontario's minister of finance.
"We are delighted that these regulations are now law, and we commend the provincial government for helping put the issue on the front burner," said Alex Johnston, executive director of advocacy group, Catalyst Canada. "These requirements will push more companies to have the conversations they should be having around board and executive committee diversity and, hopefully, their talent development. Businesses need to tap the full pool of smart, talented people to stay competitive and strengthen our country's economic future."