The Toronto Stock Exchange is changing the rules governing the election of directors to the boards of exchange-listed companies.
The new rules coming into effect at the end of the year will require directors to be elected annually, that vote totals be disclosed and that directors be elected individually rather than as part of a slate.
The TMX Group, operator of Canada’s major exchanges, made the announcement yesterday after receiving approval from the Ontario Securities Commission to proceed.
Other rule changes being adopted Dec. 31 include: issuer companies have to disclose adoptions of a majority voting policy for uncontested director elections, and have to tell the TSX if a director receives a majority of withhold votes if they do not have a majority voting policy.
Meanwhile, the TSX is seeking comment on other proposed amendments to the manual, which would require issuers to have majority voting for uncontested director elections. The comment period ends Nov. 5.
The changes are being made to “further enhancing domestic and global confidence in Canada’s capital markets,” says Kevan Cowan, president of TSX markets and group head of equities, TMX Group.
“These changes bring additional transparency to the board selection process and help to strengthen our markets’ reputation while aligning our practices to other major international jurisdictions.”