TSX Group CEO Barbara Stymiest today reinforced the Toronto Stock Exchange’s commitment to corporate governance and outlined proposed changes that will expand and enhance the listing requirements for issuers.
Among the changes the TSX is proposing:
- enhancing the independence of company board of directors by making it a requirement for continued listing on the TSX that a company’s board have at least two independent directors and that a majority be independent;
- ensuring that all TSX issuers be required to have a majority of independent members on its audit committee; and
- supporting legislation that would require CEOs to certify annually the accuracy of their disclosure relating to their TSX listing agreement.
Stymiest is calling on the Canadian Securities Administrators to begin a broad, consultative process involving issuers and market participants to work towards future governance initiatives.
“These changes represent enhancements to a system of governance at the TSX that is internationally recognized as being among the most trustworthy in the world,” writes Stymiest in a letter to Ontario Securities Commission chairman David Brown.
There are unique governance challenges with respect to the Canadian market. “More than 82% of Canadian listed companies have less than $500 million in market capitalization and 44% have less than $50 million, said Stymiest. “To implement recent U.S. style governance laws would place a greater burden on Canadian issuers and would be most acutely felt by those least able to bear them, especially our small and micro-cap issuers.”