Developing disclosure materials

Good disclosure about your system of governance is no longer optional. Public companies are now required to communicate detailed information about their governance practices, noting the processes by which decisions are made about matters such as executive compensation, succession planning and performance measurement.

The Ontario Securities Commission performs regular issuer-oriented disclosure reviews of certain aspects of disclosure. This means that they comb through your Circular looking for omissions, errors, and jargon and, if dissatisfied, could request re-publication of the disclosure materials on SEDAR.

ISS, Glass Lewis, other proxy advisory firms as well as some large institutional investors publish annual proxy voting guidelines and these organizations are quite transparent about how they will vote the shares that they hold for publicy listed companies. It is essential to understand these guidelines and the implications for shareholder voting at your annual meeting if your company's policies, governance practices and Management Information Circular disclosure do not measure up.

High profile national publications like the Globe and Mail's “Board Games” and the Clarkson Centre for Business Ethics and Board Effectiveness “Board Shareholder Confidence Index” report annually on governance practices by public companies. The authors of these reports are very influential in shaping governance policy by promoting increasingly higher standards and shining a bright light on disclosure.

I can develop a summary report for your publicly listed company, detailing your organization’s compliance with regulation and score against these public governance benchmarks, identifying gaps and opportunities to increase your governance disclosure. The report will make recommendations for short and long-term decision making with respect to the adoption of governance practices.

Some organizations depend on their law firm to prepare disclosure documents. This can result in technically accurate, jargon-filled documents that read much like a prospectus and that is simply not good governance.

I specialize in drafting public company disclosure documents such as management proxy circulars, annual information forms, annual reports and websites. This is done in a way that highlights your application of the principles of good governance, written in plain language and laid out in an easy to read format.

By improving your disclosure and monitoring what ratings organizations are saying about your practices, you will improve your corporate reputation, influence what is being published about governance practices, inspire stakeholder confidence and improve the likelihood of a successful annual meeting.