Investor-rights group Médac acknowledges its bid to end Bombardier Inc.’s dual-class share system is destined to fail, but says it has no better option to trigger a discussion on what it sees as a critical issue. The Montreal-based organization is calling for changes to the laws governing Canadian companies that give extra voting rights to […]

Allaire, Yvan, The Case for Dual-Class of Shares (December 20, 2018). Available at SSRN: https://ssrn.com/abstract=3318447 or http://dx.doi.org/10.2139/ssrn.3318447 The debate over whether dual class of shares increases or decreases share value, should be prohibited or not, should be subjected to mandatory sunset provisions, and so on has been heating up over the last few years. This paper reviews the […]

Dual-class share structures have drawn the ire of some investors, citing concerns with shareholder rights. For more on this and why he thinks there’s a place for dual-class shares, BNN Bloomberg spoke with Yvan Allaire, executive chair at the Institute for Governance of Private and Public Organizations. To view the interview, please click here

Montreal (February 4, 2019) — In Canada, the number of companies with multiple voting shares has dropped from 100 in 2005 to 69 in 2018. But these companies continue to play a vital role in the Canadian economy. The Institute for Governance has issued a policy paper in support of multiple voting shares, urging entrepreneurs […]

I would like to make two points in response to Professor Coffee’s piece on dual class common stock. First, American dual class companies should be obliged to include a “coattail” provision, as is the case in Canada. This provision, imposed since 1987 by the Toronto Stock Exchange, ensures the controlling shareholder cannot sell control without all shareholders […]

There are now 69 dual-class companies listed on the Toronto Stock Exchange, down from 100 in 2005. Only 23 Canadian companies went public since 2005 with a dual-class of shares while 16 of the 100 have since converted to a single-class and another 38 have disappeared since 2006 for other reasons (acquisitions, mergers, bankruptcies and […]

Introduction The Clarkson Centre for Board Effectiveness (CCBE) at the Rotman School of Management has a mission to study corporate governance and provide practical insights for companies about what good governance means. For more than a decade, we, like many of our peers, embraced the widely-held and publicly-listed model as the paradigm of good governance. […]

The corporate hunting season is officially underway, an annual ritual during which shareholder parties, armed with proxies and other weapons of democratic destruction, set out to bag executives and directors for failing to deliver. The list of potential corporate failings is all encompassing. Anything and everything is a target, from executive compensation to diversity policies […]

Statistics Canada estimates that, in 2017, “4.9 million Canadians aged 15 to 64 spent an estimated $5.7 billion on cannabis for medical (10% of the market) and non-medical (90% of the market) purposes. This was equivalent to around $1,200 per cannabis consumer.” Private companies, several of them listed on the stock exchange and already supplying […]

There is a frenzied rush to get/give a new ‘right” to shareholders, the right to put up their own nominees for board membership. Boards of directors, so goes a dominant opinion, are not to be fully trusted to pick the right kind of people as directors or to shift the membership swiftly as circumstances change, […]

Winston Peters’ swingeing attack on Fonterra boss Theo Spierings’ $8.3 million pay packet could be the first real salvo in his self-advertised campaign to ‘clean up corporate New Zealand’. There was little attention given to Peters’ campaign against alleged business “fat cats” while he was slugging it out on the election trail. But given the […]

Corporate America started the year ready to engage with a controversial but business-minded president. This week CEOs have risen in chorus to denounce Trump’s lackluster response to racism. Not since the 1930s, when prominent business heads publicly broke with Franklin Roosevelt, has a US president seen such a revolt by leading business executives. [ … […]

After some 15 years of tweaking and polishing the theory and practice of “good” governance, perfectly independent board members remain surprise-prone, estranged from the goings-on in the company, partially informed and lacking the wherewithal to challenge management. No doubt that the legitimacy and credibility of boards have suffered as a result. In the current age, […]

The practice of a non-binding say-on-pay vote by shareholders spread quickly and broadly. It seemed that, finally, shareholders would be given the opportunity to express their dissatisfaction with outrageous or ill-conceived compensation packages. The practice, at first, was voluntary with companies agreeing to submit their compensation policies to a vote. Then, as the number of […]

With the Bombardier saga and the Couche-Tard warning bell, the usual litany of arguments against dual class of shares was again dusted off. Commentators opposed to this capital structure seem to forget or overlook the inconvenient truth that many of Canada’s industrial champions are controlled corporations often through a dual class of shares. That is […]