Outrageous behaviour by executives and their boards is not exclusive to corporate America. Bre-X Minerals Ltd., YBM Magnex International, Livent Inc. and Cinar Corp. all pre-dated high-profile corporate scandals in the US. These Canadian companies have also violated the basic tenets of good governance by loading their boards with insiders, rubber-stamping rich compensation packages and interest-free loans for executives and failing to disclose company financial dealings to investors. Consequently, Canadian investors are showing up at annual meetings in unprecedented numbers to vent their anger over what they see as excesses in executive compensation. They are also demanding a stronger, more independent role for company directors. This reaction is understandable when considering the results of a 2002 Globe and Mail study on Canadian corporate governance practices. Rating companies in terms of board composition, shareholding and compensation arrangements, shareholder rights and disclosure, the study found many Canadian companies did not even meet ex-isting Toronto Stock Exchange guidelines.
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