Canada’s new pay rules

The Canadians are also about to introduce changes.  Not that they had much choice.  Most large Canadian companies trade their securities in US markets, so have to comply with US and Canadian laws.  The changes will also impact the small but growing number of dual listed Australian and Canadian companies.

The Canadians appear to have mastered a state based consensus building process that continues to elude Australia’s COAG deliberations.

The changes are designed to give investors better access to information.

Canadian boards have always had a responsibility to consider and disclose general risks faced by a company but making it this specific increases the odds they will take it seriously. It is interesting that the Australian government has ignored numerous submissions advocating a similar approach, while introducing changes that almost all stakeholders have opposed.

Interestingly, the Canadian requirements are free of the loopholes in the Australian law that allow broad-based accounting and law firms to provide conflicted remuneration advice free of disclosure requirements.