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In the coming year, the Ontario Securities Commission will conduct a review of compliance with the requirements of National Instrument 58-101 Disclosure of Corporate Governance Practices.

The review will involve assessing the adequacy of corporate governance disclosure in information circulars (or annual information forms or annual management’s discussion and analysis, if applicable) filed by issuers in spring 2010.

The regulator also intends to issue a staff notice providing guidance on compliance with existing environmental disclosure requirements under National Instrument 51-102 Continuous Disclosure Obligations.

The OSC plans to consult with its advisory committees and other experts in this area. The notice is expected to be published by December 2010 so that reporting issuers will have sufficient time to consider the guidance when preparing their 2010 annual continuous disclosure documents.

The OSC says the actions are the outcome of a corporate sustainability reporting initiative, which was undertaken in response to a broad resolution introduced by MPP Laurel Broten and unanimously approved by the Ontario Legislature on April 9, 2009. The non-binding resolution called on the OSC to undertake “a broad consultation to establish best practice corporate social responsibility and environmental, social and governance reporting standards”.

The provincial finance ministry and the OSC agreed the regulator would:

• Review existing disclosure requirements under Ontario securities legislation for reporting issuers (other than investment funds) regarding corporate governance and environmental matters.

• Consult with investors, issuers, advisors and other stakeholders on these matters.

• Make recommendations to the Minister of Finance by January 1, 2010 regarding “next steps” to enhance disclosure.

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CGA Alberta opposes national regulator

The Certified General Accountants’ Association of Alberta (CGA Alberta) is applauding the Government of Alberta’s decision to launch a court challenge of the federal government’s efforts to create a national securities regulator.

“We fully support the efforts of the Alberta Government to question the jurisdictional rights of the federal government to force the development of a single regulator in Canada,” says John Carpenter, CEO of CGA Alberta. “Firstly, we do not support the justifications the federal finance minister espouses in his explanations for this attempt. Secondly, we have serious concerns about the consequences to Alberta business and the Alberta economy if this is allowed to proceed.”

Carpenter prefers the current passport system, which all provinces except Ontario have joined. CGA Alberta says it is well-designed to deal with the issues of harmonization, duplication, accountability and international representation.

“My larger concern is over the likely outcome that we will develop a central-Canadian regulator who will not understand unique regional economic circumstances,” Carpenter says. “Where would Alberta be without junior capital pools and their contemporary equivalents? The west, in particular, has unique business needs others do not understand and often will not accommodate. Local securities commissions are necessary for a response to those unique local needs and the arguments against them are full of hyperbole and unsubstantiated assumptions.”

(12/18/09)