Proceedings of the Standing Senate Committee on
Banking, Trade and Commerce

Issue 16 - Evidence - February 2, 2011


OTTAWA, Wednesday, February 2, 2011

The Standing Senate Committee on Banking, Trade and Commerce, to which was referred Bill S-206, An Act to establish gender parity on the board of directors of certain corporations, financial institutions and parent Crown corporations, met this day at 4:20 p.m. to give consideration to the bill.

Senator Michael A. Meighen (Chair) in the chair.

[English]

The Chair: Good afternoon. This is the first meeting of the Standing Senate Committee on Banking, Trade and Commerce in 2011. My name is Michael Meighen, from Ontario, and I am Chair of this Committee.

I will introduce the members of the committee who are present. To my right is our distinguished Deputy Chair, Senator Hervieux-Payette, from Quebec; Senator Gerstein, from Ontario; Senator Ataullahjan, from Ontario; Senator Mockler, from New Brunswick; Senator Massicotte, from Quebec; Senator Kochhar, from Ontario; and Senator Oliver, from Nova Scotia. On my left are Senator Ringuette, from New Brunswick; Senator Moore, from Nova Scotia; and as a special guest today, Senator Pépin, from Quebec. Welcome honourable senators.

[Translation]

Bill S-206, An Act to establish gender parity on the board of directors of certain corporations, financial institutions and parent Crown corporations, was introduced in the Senate by Senator Céline Hervieux-Payette, P.C., and received first reading on March 9, 2010. On May 13, 2010, Bill S-206 was referred to the Standing Senate Committee on Banking, Trade and Commerce.

The bill would amend: sections 105, 260 and 262 of the Canada Business Corporations Act; sections 159 and 216 of the Bank Act; sections 169 and 220 of the Cooperative Credit Associations Act; sections 167 and 225 of the Insurance Companies Act; sections 163 and 221 of the Trust and Loan Companies Act; and section 105 of the Financial Administration Act.

It would require certain corporations and financial institutions to achieve parity in the number of women and men serving as directors, starting at the second annual meeting following the day on which the proposed act comes into force, although application for deferral to the third annual meeting could be made in certain circumstances. The two- year requirement would be three years for relevant parent crown corporations.

[English]

This committee began its consideration of the bill on June 16, 2010, when we heard from the bill's sponsor, the Deputy Chair of the Committee. We heard from additional witnesses on December 9, 2010. For the first hour of today's meeting, we are joined by Louise Champoux-Paillé, Administrator for the Mouvement d'éducation et de défense des actionnaires, MÉDAC.

[Translation]

Ms. Champoux-Paillé, thank you for being here with us today and I commend you on your dedication. Ms. Champoux-Paillé spent four hours on the bus to come from Montreal and appear here today. Welcome.

Ms. Champoux-Paillé, you have the floor. Senators will certainly have questions for you after your presentation.

Louise Champoux-Paillé, Administrator, Mouvement d'éducation et de défense des actionnaires (MÉDAC): Thank you to the chair and deputy chair. Honourable senators, we at MÉDAC are very pleased to be appearing here today at your invitation.

I will answer your questions and attempt to convince you of the importance of Bill S-206 for Canadian society as a whole. My presentation will be divided into four parts.

In the first part, I will present the Mouvement d'éducation et de défense des actionnaires and the work we have done to promote more female representation on boards of directors. In the second, I will briefly describe the current situation in Canada. The third part will set out the advantages of parity and deal with the myths that are impeding women from reaching decision-making positions. The fourth and last part will look at how having a critical mass of women is a necessary tool for change.

I will therefore begin with a few words about MÉDAC, the Mouvement d'éducation et de défense des actionnaires. The movement was founded by Yves Michaud in 1995 and, as its name indicates, its objective is to educate and advocate for those who invest and save money. We are a not-for-profit organization with headquarters in Montreal. Our board of directors is chaired by Claude Béland, former president of the Desjardins Movement, whom you heard from regarding another bill.

I have been a member of the board of directors for nearly six years and am responsible for coordinating the annual campaigns, shareholders proposals, the drafting of briefs, oversight, governance studies and shareholder participation, including with respect to parity and the equity ratio as it relates to executive salaries.

Concretely, we carry out our mission to advocate for shareholders by submitting proposals from shareholders every year to Canadian companies. These proposals generally relate to sound governance. We have limited our activities up to this point to Canadian firms, since the Quebec legislation, the Loi des compagnies du Québec, does not allow us to do otherwise. That situation will change on February 14.

Since our organization came into being, we have presented over 60 shareholder proposals to a dozen or so major companies. This makes MÉDAC the most active organization in Quebec and in Canada in this regard: nearly 60 proposals annually for 15 years submitted to some 15 companies add up to a total of 500 proposals. In Canada as a whole over the past 20 years, there have been 1,000 proposals. So our organization has been the most active in this regard.

Early last year, in January 2010, I published a study on the effectiveness of shareholder proposals, entitled Les propositions d'actionnaires: pilier de saine gouvernance. Our conclusion was that shareholder proposals contribute to improving governance, something that is illustrated in the results of the Board Games findings published every year by the Globe and Mail.

For example, the following aspects of good governance are part and parcel today of how major Canadian and Quebec financial institutions operate: a separation of powers between the president and the board of directors and the president and the chief operating officer; the disclosure and the independence of external auditors and salary consultants; information disclosure to all shareholders simultaneously; and, finally, consultative voting on executive salaries, which is the so-called ``Say on Pay'' policy that has been adopted by over 40 Canadian companies.

Gender parity on boards of directors has been a major issue for MÉDAC since 2006. Our most important success in this area has been the 2009 commitment by the National Bank to increase the number of female directors and work towards parity. In its letter to shareholders, the bank mentioned that it was aiming for half of the candidates selected for vacant director positions to be women. That change came about as a result of our shareholders proposal.

We are continuing our efforts this year with a similar proposal calling for parity within 10 years. That gives you a brief overview of MÉDACs activities with respect to Canadian businesses.

The second part of my presentation will deal with how much female representation currently exists on boards of directors. I will present four statistics that we feel are very telling.

Women today hold only 14 per cent of directorships in major publicly traded companies in Canada. According to a study by Spencer Stuart, a consultant firm that does research in this area, 51 per cent of major Canadian companies have no more than one woman on their board of directors. I repeat: 51 per cent.

The percentage of women appointed to directorships actually declined between 2008 and 2009 from 26 per cent to 13 per cent. A significant increase occurred between 1998 and 2003, from 6.2 per cent to 11.2 per cent. In 2005, the figure was 12 per cent; in 2007, 13 per cent and in 2009, 14 per cent.

So there was a marked increase from 1998 to 2003 and then stagnation after that. If nothing is done to change this trend, it will take another 50 years to achieve parity. Canadian society is being denied the contribution of various talents, which I will try to describe in the third part of my brief, which is about the need for change.

I will present this from two angles, the added value of having more women on boards on directors, and the myths that make it difficult for women to accede to these decision-making positions.

I would make five points about the value that women add. What are the advantages of having a higher proportion of female directors? There is better performance in the event of financial crisis, especially if that crisis results from excessive risk-taking. Studies have shown that women have a different management style from men. Especially, where risk-taking is concerned, women tend to be more cautious, making less risky decisions and taking more prudent positions.

Better governance is another advantage. According to a Conference Board study, boards with more female directors place more emphasis on dealing with conflicts of interests, scrutinizing risks, financial monitoring and maintaining good relations with investors.

A third benefit is better decision-making, since women favour discussions involving different perspectives. Here again, there are studies that show that men focus more on the short-term results of decisions, whereas women look at the longer term, which enriches discussions and leads to better decision-making.

There are also studies indicating that companies perform better financially when they have a significant proportion of women on their board.

Finally, women improve the company's image with investors and employees. So these are five major qualities that boards can count on but they do not count on them enough.

Now that I have indicated the benefits, what are the main myths and obstacles that prevent women from being adequately represented? The first myth is one that I have been dealing with for 20 years: there are not enough women to meet the demand. In the 1970s, women were outnumbered by men in universities. But; that situation has radically changed. Nearly 60 per cent of undergraduate students are women. According to Statistics Canada, that trend is likely to increase in the coming years.

So there is a growing pool of female talent available and these women are increasingly experienced. Canadian society needs to take advantage of this talent.

The other myth is that women do not have the skills or experience needed to be directors. If this pool of potential candidates has now existed for some years, it is worth looking at the selection process and some of the criteria used in choosing new directors.

One requirement is that a person must have held the position of CEO in order to become a director; only 3.8 per cent of women meet this criterion, according to a recent Catalyst study. Using a skill chart to identify potential directors is an important governance practice and one that we promote. That said, if companies want to take a different approach to problems and develop innovative visions, should they not be emphasizing other talents and experience that would enrich the decision-making process?

The third myth is that it is hard to recruit women. Recruitment may be difficult because most boards are made up mainly of men. Their search is limited to their network of male contacts, the old boys' network. Unless you take vigorous action, boards of directors will continue to be composed mainly of men. We do recognize that organizations need to conform to outside social and ethical rules and norms.

Only a significant counterweight proving the necessity of parity in the medium term will lead to change. Increasingly there are means for identifying talent and the critical mass of women capable of meeting those needs exists.

The fourth myth is that the gender mixing has nothing to do with business. People may even say that nothing will change, but once again, and I spoke about this earlier, several studies show that there is a positive link between the presence of women on boards and the financial performance and healthy governance of organizations.

Finally, some say that one woman will set the tone, that in appointing one woman, enough has been done in order to benefit from the advantages of the female participation. The research shows that the advantages associated with a female presence on boards increase with an increase in the number of women.

According to Kanter, a researcher often quoted on this topic, a group has to be present in a proportion of 35 per cent before having any influence on the dominant group. There are therefore very few advantages associated with a critical mass of female talent for our Canadian businesses because one Canadian company out of two has one woman or less on their board.

I am now going to speak about the role of a critical mass. I would like to give as an example Norway, where, in 2003, that path was chosen. A 40 per cent critical mass was imposed and today there is a 44 per cent female presence on their boards.

Spain acted in 2007 and, more recently, in January 2011 France set critical masses for women on boards. Closer to home, in 2006, the Government of Quebec adopted a policy whereby crown agency boards would be made up equally of men and women by 2011.

We undertook a small census of 24 crown agencies in 2006. There was a 24 per cent female presence at the time and today there is almost full parity.

In conclusion, one might ask whether or not simply knowing that a 40, 45, or 50-per cent critical mass is going to be imposed is enough to make companies change their behaviour. For example, in Norway, crown agencies had to be compliant by January 1, 2004. Implementation of the law was delayed in order to give publicly-traded companies time to comply. The government waited for two years and despite pressure to comply, no action was taken. Norway then set a 40 per cent requirement for both crown agencies and publicly-traded companies. So it is not enough to simply say that you are thinking about it. If we truly want the benefits of female talent, then a specific percentage has to be set.

My conclusion is therefore that mandatory critical masses are, I must admit, both unfortunate and necessary. It is unfortunate that decisions have to be imposed on businesses and we can only hope that this will not take away from the value of future female appointments, which I doubt, given the increasing number of experienced women capable of filling these positions, as they have been for several decades.

This bill is necessary because of the lack of progress and Canada's delay justifies such measures. It is also an opportunity to improve governance in our organizations both in the short and medium term. At the beginning of my remarks, I mentioned a Conference Board of Canada report entitled Women on Boards: Not Just The Right Thing . . . But The `Bright' Thing. Female governance is not only the right thing to do but also the bright thing to do. Independent thinking, ability to listen and to dialogue, concern for the future of the organizations they work for, these are all typical female characteristics. The studies on performance bear this out. Canada's diversity in gender, origins and culture has been a fantastic factor in its development. It can also be true for Canadian companies.

The Chair: Thank you for your opening remarks Ms. Champoux-Paillé. They were very clear and well thought out. I must admit that for the most part I agree with your analysis. Allow me to ask you one question.

If I understood you correctly, you are in favour of passing this bill because you think that the means used to date by MÉDAC and other groups, even though they have been successful with some companies, are going to take too long. I do not want to put words in your mouth but that is my understanding. Regarding Bill S-206, do you have any problems in requiring parity? Do you distinguish between parity and the critical mass you referred to? A critical mass of 30 per cent for a company means that there may be 60 per cent women and 30 per cent men on a board. With parity, that would only be 50 per cent women. Is there a danger in limiting the numbers of women?

Ms. Champoux-Paillé: That is not limiting the numbers, that is requiring a number, if I may say, in order to overcome the barriers that currently exist and achieve a minimum, whether that be 40 per cent or 45 per cent; we think that is important and it is based on the fact that you need a sufficient amount of difference in order for change to happen.

The Chair: I see. Thank you.

[English]

Senator Oliver: I am interested in diversity and good governance. I feel that Canada has missed the boat in not taking more steps to encourage and promote more women to boards of directors and other senior positions in our country. I believe something should be done about this situation; however, I am not so sure that this bill is the way to go about it.

One of my concerns is that many years ago, the Government of Canada said that there are four groups, not just women, but four groups in need of special measures so that they can be fairly represented throughout Canada. This bill excludes other members of those groups. It is too specific. For instance, what about visible minorities? When you talk about women on boards of directors, do you include Chinese women, Indian women and women from other ethnic origins, or is it about Caucasian women only? To ensure that they are not all white women, should there not be something saying that we encourage Canadian researchers to look for competent visible minority women for these boards? That is my first concern.

Second, to get the experience, professionalism and the various views that are required, visible minority woman who have had experiences different to those of Caucasian women would make wonderful contributions to boards of directors. However, there is nothing in the bill that would encourage anyone to want to include them. That is my concern. I would like to have your comments.

Ms. Champoux-Paillé: Could you repeat the second question?

Senator Oliver: I thought it was all one question.

[Translation]

Ms. Champoux-Paillé: That is a question about diversity. When we refer to a critical mass of women, are we only referring to white Canadian women? Not at all. We are advocating for diversity. I concluded my remarks by saying that we believe that boards in Canadian companies should have female talent of all origins.

I undertook my studies with men and women from other countries and I can testify to the contribution they make in decision-making, the various values they provide in problem-solving, so you have our support on that. When we refer to women on boards we are referring to the diversity of female talent from all backgrounds, that should be a part of boards and organizations as a whole.

[English]

Senator Frum: Ms. Champoux-Paillé, you referred to the interesting development in our universities where over 60 per cent of students are women. In some places, the numbers are higher, such as at Laval medical school where it is reaching 75 per cent. Soon a men's movement could come along that will say we have to legislate parity at university campuses. The gains made by women in education are fairly recent. This is a new phenomenon. I know that some say that the percentage is clearly unfair. In this brief time, we have seen women reach equality plus on campus. How would you feel about legislation regulating gender parity on campus?

[Translation]

Ms. Champoux-Paillé: We have not specifically considered that. I do not think that imposing access thresholds are a solution for encouraging emerging talent. I think that if there are fewer young students in universities, it is more an issue of interest than anything else. At least, that is what I read in the papers. Unfortunately I do not have children in that age group but I think our universities are there to encourage talent that is willing to take responsibility. I do not see how your suggestion would work because I think it is an issue of talent.

It is quite evident that women are interested in sitting on boards, and they have the will and the skills. I can see that combination of talent and will, whereas in the situation you are referring to, the issue is one of will. I cannot see the problem from the same angle. Perhaps I am mistaken.

[English]

Senator Frum: As a female senator, I am sympathetic to women having a full voice at the table and participating fully. However, I get nervous when a see a quota program. While this bill is designed to help women, there are all kinds of ways in which women are dominant in other fields and areas where a quota system could be used against them. I have some concerns and reservations about introducing quotas at a time when women's achievement is truly surpassing that of men in many respects.

[Translation]

Ms. Champoux-Paillé: I would add to that that we have had to fight major obstacles, myths that prevent access to boards or to senior administrative positions. In the situation you are asking me about, I do not have the same perspective. This is not about a societal barrier, or an environmental barrier, but rather about willpower. Perhaps there is no will to invest in studies. That, at least, is what I have drawn from the information I have read on access for young men. That is my reading of the situation.

[English]

Senator Frum: I have spoken to educators at the University of Toronto, and I understand that very soon they will have to impose quotas on female students because they do not want their classes to reach 80 per cent to 90 per cent female. At Trinity College at the University of Toronto, this is a fact. Quotas can be good and can work for you but they can also work against you.

Senator Kochhar: I apologize for asking questions in English. I admire your passion for gender equality. I, too, am in favour of gender equality as I am in favour of minority equality everywhere. However, I stop there because I do not think you can legislate equality in the workforce.

I come from a country where quotas are dominant. They want to promote poor people and those who have been left behind; but it does not work in most developing countries.

If you were talking about 100 years ago, I would agree with you. Today the statistics show that we are making 8 per cent gains in such appointments every three years. If we keep up that trend, by 2020 we will have more women than men appointed to boards. Currently, nine corporations in the Fortune 500 have more women than men on their boards. Will we legislate gender equality and have to let half of them go? How do you feel about that?

[Translation]

Ms. Champoux-Paillé: You are using statistics that differ slightly from mine but I would answer that requiring a percentage or a threshold is unfortunate but necessary if we want things to change.

Currently, 51 per cent of companies have boards with one female or less. I think Canada deserves boards that contain the critical mass that is necessary for change to happen, in order to provide an opportunity for better governance. It is towards this end alone that we are working and it has been shown that when you sit alone on a board, alone within a Canadian-born group, if I may put it that way, you cannot change much. However, if there are several individuals from different countries, then they make the rest of us see things differently. I can see that the people sitting around this table come from different backgrounds and you improve decision-making on Canadian issues. There has to be a critical mass for change. That is the spirit of our presentation.

Senator Pépin: Since the legislation on gender parity on boards was implemented in Quebec in 2006, what has changed for business women?

Several studies have shown that gender parity on boards makes businesses more efficient. Have you observed this in Quebec since the legislation was passed?

Ms. Champoux-Paillé: Few studies have been done on crown agency boards since 2006. There has been an increase in female members. The issue of the quality of decision-making is one that interests many researchers. Because boards are such a closed environment, it is difficult to analyze the decision-making. The Council on the Status of Women just published a study in which it applauds the increase in percentages. Are crown agencies better managed with a female presence? In four years, their participation has increased from 30 per cent to 45 per cent. I think more time will have to pass until we know. But if I look at the conclusions of the Conference Board of Canada, that has been looking at this since 1996, improvements have been made in the area of conflict of interest management, as well as the areas of monitoring and general auditing.

Senator Pépin: For business women.

Ms. Champoux-Paillé: It is an opportunity to participate in decision-making.

Senator Pépin: Good. Thank you.

Senator Massicotte: Let us look at the reasoning behind this throughout the world. My reading is that there are two kinds: there is the social issue, in other words we should not be close-minded. No doubt there have been prejudices in terms of equality. That is the reality of society. I think that this is changing with time but it is still present to a certain extent.

The other reasoning that is often stressed is profitability. You say that it is in the selfish interest of companies to seek parity because they lose out if they do not. one should really focus on the second type of reasoning, that is, that it is profitable, it is in the interest of society, to seek parity. How much weight is given to each argument?

Ms. Champoux-Paillé: Our position, because I also represent MÉDAC, is that the priority should be healthy governance of organizations. This includes decision-making, conflict management, the future of organizations. It has been proven that an increased female presence within boards leads to increased focus on the long term rather than the short term. That is why we feel there should be a critical mass of women on boards.

But you mentioned something else that struck me. Boards have appointment committees where criteria are used to choose individuals who will sit on the board. The criteria often include past experience as a CEO. Very few women meet that criteria so that is a form of indirect discrimination. Is there fairness? I do not think so. The criteria looks fair, it is regarded as being objective, that is that one has to have been a chief executive officer to sit on a board, but given that few women have that experience, the criteria is unfair to a degree.

That is why selection processes have to be reviewed, in order to ensure that women's contributions to these boards can be acknowledged.

Senator Massicotte: That is a good point, however the board is the boss of the CEO and the criteria may be very important in these appointments; but it is a vicious circle. If the criteria is upheld, I would argue for it being an important, but not exclusive criteria.

Ms. Champoux-Paillé: I believe that that criteria is worth 46 per cent of all the criteria that are used, according to a report I read. You can see how much weight it is given; the thinking is that it is fair, but it is not because it is a form of indirect discrimination.

Senator Massicotte: I sympathize but the second point, the issue of profitability, is very important. The problem is that you are referring to three studies. We have heard from witnesses, and I have looked extensively into international studies. The scientists conclude that there are no hard and fast rules that show that more women lead to better financial outcomes. Yes, the presence of women encourages participation, in some cases there is better governance, but I would have liked it to be clearer that companies do better financially. I will read your three studies. You also referred to FORBES, but scientifically it is not clear; I am somewhat bothered by that. Where is it stated that if there are more women there is better governance? The argument can be made. Those companies are more open because they are hiring women. Perhaps that is the result of a company being more open. The reasons are not clear. One economist recently published a study that showed there is no scientific basis for saying that good governance equals good results. There is a global trend in that area, and there is a global trend to separate CEOs from the boards. However, the studies do not prove that those companies are more profitable, or take less risks. It is confusing.

Ms. Champoux-Paillé: You are right. Studies point us to these conclusions, but there has been no direct demonstrated link. There is, however, a study by Catalyst that was done over a 10-year period. This is the most meaningful study as it covered a longer period of time.

Moreover, I would encourage you to perhaps think about the fact that, 30 or 40 years ago, there were not so many women in the Senate, and to reflect on how the presence of women could have changed things. I would like to raise this issue.

Senator Ringuette: I agree with your arguments. I listened to your exchange with Senator Frum about the fact that, at the University of Toronto, there was a movement of young men demanding admission parity in university programs.

Based on my experience in the university sector, I would say that access applications are open, public and, if my memory serves me correctly, pertain to the qualifications of the individual, regardless of gender. I would therefore deduce that if there are more women in the university, it is because the women who apply are more highly qualified.

In the private corporate sector, however, the admission system is not open, consequently, ranking cannot be established on the basis of equal qualifications. This is the main difference between the two arguments: we are comparing a completely closed system to a completely open one.

It seems to me that in the University of Toronto example, more women can rank based on qualifications.

Ms. Champoux-Paillé: Exactly. When we demand parity, it is because we have the pool of talent required to meet the requirements of the board of directors and there is a will to participate. In the cases that we are discussing, in the universities, there is equality with respect to qualifications, but there is also this will; the two criteria must both be taken into consideration. Currently, women's access to boards of directors is curtailed despite the fact that there is a critical mass of available women and they have a desire to play a role in Canadian corporations.

[English]

The Chair: I will allow Senator Frum a short supplementary.

Senator Frum: Universities fall within the public domain as they are largely funded by public funds. The idea of legislating parity in a public domain versus the private domain strikes me as more logical. For a government to interfere in the decisions of private companies strikes me also as a dangerous precedent.

Senator Ringuette talks about it being a closed system; that is correct. We are talking about private entities. We are talking about government interference in private entities, as opposed to universities, which quite frankly fall more within the sphere of government and public monies.

My question is do you agree?

[Translation]

Ms. Champoux-Paillé: In my opinion, this is the only way to bring about change. Women have been trained in our Canadian universities for 40 or 50 years and we are not using their talents. Most importantly, there is a critical mass of women available. The talent is there, but the brakes have been applied to prevent them from gaining access to these boards of directors. And Canadian society as a whole is depriving itself of the talents that could enable it to become a better society.

Senator Hervieux-Payette: Recently, tribute was paid to Paul Tellier, Clerk of the Privy Council under the Mulroney government and former president of CN and Bombardier, before a crowd of 500 people. In addressing his colleagues, business people from large corporations, he told them that he sincerely believed that an individual should not sit on more than four boards of directors and that those sitting on eight boards of directors were not doing their jobs, that terms should be limited to two four-year terms, that the people who were hanging onto their board of director seats for 10 or 15 years were no longer bringing fresh ideas to the team and no longer able to see the reality of the corporation. He also spoke about the importance of increased diversity, such as the presence of women, with the critical mass.

This is as man who has experience in two large corporations: CN, which in time became an American corporation because the shareholders became American; and Bombardier, a Canadian corporation with activities throughout the world. This was, to some extent, the legacy of Mr. Tellier and his experience. I would like your comments.

If a man with his experience, having witnessed the economic evolution of our society, is recommending that we head in this direction, the only question we should be asking ourselves is: how can we get there?

Personally, I tabled a bill but I do not believe that I will see this happen in my life, at the speed with which we have been proceeding over the past 20 years. In Quebec, we are still a minority in engineering faculties. In computer engineering as well. There are of course sectors that appeal to guys and they go there. I do not see why we should force guys to study medicine if they do not want to practice. Moreover, now that doctors are making less money and no longer working 90 hours per week, it is curious, but there are fewer guys. I am reassured because it seems to me that I will receive better care if my doctor has a chance to sleep. Are these criteria important to ensure good governance, because I understood that this formed the very basis of your association?

Ms. Champoux-Paillé: Yes. I have in fact read Mr. Tellier's legacy, as you described it so well, regarding the length and number of terms. We have already tabled our proposals.

I am going to discuss a matter that you are certainly very familiar with: Canadian banks. On average, directors sit on the boards of the seven Canadian banks for a term of nine years. So the directors remain for 9 years; in some banks, this can be as long as 10 or 11 years. So if there is to be some renewal within the boards of directors, it could take many years before positions become available.

Moreover, I noted that in 2009 — because the information circulars for 2010 have not yet come out — out of 106 positions on bank boards of directors, there was only one new member, Mr. D'Alessandro. The banks are not lagging behind, they are good students and, on average, 25 per cent of their board members are women. They are leading the way. I have nothing against banks, but I would simply like to say that, with the plurality of terms that you alluded to, it will take years before we achieve parity.

If my memory serves me correctly, I believe that France has thought about its parity initiative and has added this component. I see that the people sitting around this table have different backgrounds and ages.

Renewing the decision-making process requires renewal within the boards of directors and this is an aspect which has been the subject of many of our representations.

Senator Hervieux-Payette: Thank you very much.

The Chair: Unfortunately, I am going to have to bring this very interesting discussion to an end. I would have liked to continue but we have to respect the schedule. I would like to thank you, Ms. Champoux-Paillé, for coming here this evening.

Your testimony is very useful to the members of the committee. I wish you a good trip back to Montreal and I hope that the snow will stop falling.

Ms. Champoux-Paillé: Thank you and I hope that I did not put too much passion in my comments. I made this presentation with all the heart that I have given to this cause for 20 years now.

The Chair: Passion is what makes the world work.

[English]

We will move to our next panel of witnesses by video conference: Ruth Vachon, President and CEO of the Réseau des femmes d'affaires du Québec; Justine Lacoste, a lawyer with that organization; and Irene Pfeiffer, a strategic consultant with The Mustard Seed, in Calgary. Welcome.

Irene Pfeiffer, Strategic Consultant, The Mustard Seed: Honourable senators, I would like to thank you very much for asking me to participate this afternoon. By way of background, I am a member of the Order of Canada; I have extensive experience in senior management in the oil and gas industry in the West; and I am a member of a number of not-for-profit boards in Canada. I am also the first non-doctor to chair the College of Physicians and Surgeons of Alberta. I mention that because the term ``strategic consultant'' does not give justice. I am a member of the International Women's Forum, which is in Montreal and many other cities across Canada.

The IWF advances the leadership of women across Canada in their careers and culture on various continents. We are presently on five continents, with 5,000 women leaders and approximately 300 senior women leaders in Canada. I am on their executive board.

I apologize if I have been redundant in my remarks, but I was denied access to the beginning of these proceedings on the basis that it was too expensive for us to listen in — my apologies for that. My remarks will be brief. Listening to my colleagues in Montreal and responding to questions would be more fruitful.

I have a couple of comments with regard to the proposed legislation. I have great trepidation with government interfering with private enterprise. Having said that, I believe it is unfortunate that in Canada today we would need legislation to achieve parity for women in business.

According to the Catalyst 2010 report, we make up about 50 per cent of the workforce but less than 20 per cent of boards of directors. The Financial Post actually puts that statistic at 14 per cent. I must commend the province of Quebec for being on track to have 50 per cent women in Crown corporations by 2011.

I often hear that there are not qualified women to assume these positions, and I object strongly to that particular statement. Moreover, we have post-secondary institutions across Canada that provide valuable instruction on the roles of boards and their responsibilities. Every year, we graduate both men and women from these programs who do not have the opportunity to practise the skills and expertise.

Specifically relating to the legislation, if we have to do this, so be it. We have had to do it in the past, and we have had positive results. However, I would highly recommend that it be qualified women — not just women and not tokenism. That would not solve anything for anyone. As well, we need to clearly define what ``undue hardship'' means. Undue hardship does not mean not having a network of well-qualified women to assume positions. Undue hardship in Canada today does not mean travel or time zones. These are not undue hardships. We need to clearly understand what it is that we are trying to do.

[Translation]

Ruth Vachon, President and Chief Executive Officer, Réseau des femmes d'affaires du Québec: Mr. Chair, thank you for your invitation, we are very pleased to be here.

I am truly pleased to have this position as President and Chief Executive Officer of the Réseau des femmes d'affaires du Québec. I have been in this position only since last June.

I have more than 25 years of business experience. I am originally from Saguenay and spent seven years working for ALCAN, the aluminum company. I have established a series of successful businesses: a reception equipment rental centre, a distribution centre and a training centre, up until 2001.

I am an expert in management and a natural leader, I am very strong in sales and planning. After selling my assets, I took a new career direction in consulting and interim management.

I assisted entrepreneurs with reorganization, expansion and diversification initiatives.

I received two Femina Awards given by the Réseau des femmes d'affaires in 1988 and in 1991. In 1993, I was a finalist for the Dominique-Rollin Award for the business of the year category which is given by the Montreal South Shore Chamber of Commerce.

I have sat on boards of directors, including that of the Saison jazz Montréal, and UNICEF, and I have been part of the advisory board of the Charles-Lemoyne College.

Before becoming president of the Réseau des femmes d'affaires du Québec, I participated, as a member, in many of its activities. I have known some extraordinary women, competent women, I have done business with them and many of them have become great friends.

Statistics show that women control $7 million worth of consumer and corporate spending. In households, women are responsible for 80 per cent of all purchases, they are responsible for 95 per cent of furniture purchases, 91 per cent of house purchases, 60 per cent of car purchases and 50 per cent of business travel. Women are therefore influential consumers in the purchase of goods and services, stimulating not only the economies of Quebec and Canada but those of the entire world. They consume sustainable goods, they are very demanding, they have very high selection criteria and they are very well informed.

In addition, nearly half of the individuals with assets of $500,000 are women. With this money, they get into business, create jobs and become financial backers. Persuaded that solidarity, a typically female value, is essential to the success of businesses and the advancement of society, this trait underpins their relationships.

As a recent study confirms, 47 per cent of the 1.3 million SMEs are owned by women and 16 per cent of Canadian SMEs are held primarily by women. This is a very good piece of news and if the upward trend continues, in less than 10 years, they will have achieved 50 per cent of SME share ownership.

Women entrepreneurs are now at the helm of financially robust companies. They are working in sectors where the future is promising. That means, among other things, that they have learned to manage financial risk and we are seeing women contribute more and more tangibly to the economic prosperity of the country, but, in addition, they are seeking their rightful place in the upper spheres of economic and decision-making power. There they will be able to influence the way policies are being shaped.

Called upon to work internationally, in countries where the status of women does not reflect that recognized in Canada, we find ourselves playing pioneer roles. In cases where individual freedom is not recognized, we can make a contribution, if only by our exemplary presence, in developing the role of women in business at the international level.

We see more and more women in a position to fill leadership roles. They want the doors of decision-making to be opened to them. We will have even greater influence when we have our hands on the financial levers and participate in decision-making.

Today the women sitting on the boards of Quebec's corporate giants represent only 16.8 per cent according to the opinion, published last December, of the Conseil du statut de la femme.

We feel that it would be desirable to pass legislation enabling women to become members of the boards of directors of corporations that are publicly traded, cooperatives, banks, insurance companies and crown corporations.

As mentioned in the book by Louise St-Cyr and Francine Richer, the establishment of our network, which brings together 33 per cent of women in executive positions and 67 per cent entrepreneurs, provided a pathway that women who wanted to find their rightful place in society in general and in the world of business in particular, decided to follow.

Their efforts have contributed to the success of women in different ways. For instance, our Femmes d'affaires du Québec award, which has been in existence now for more than 10 years, showcases inspirational women models, and we do what we can to help women find their place, their identity and help them achieve their potential a little more every day.

Women join the network to develop and improve their network of contacts through sustainable networking activities. By getting involved, they increase their visibility and, in so doing, become more well-known.

For some of them, this is a springboard. Bringing women together to create sustainable associations with all of those who wish to work to improve the status of women in every way, that is one of the objectives of our network.

We are unwavering, so much needs to be done, and the network will be celebrating its 30th anniversary this year. We know, as Jean de la Fontaine said so well, that ``. . . Patience and time do more than strength or passion . . .''

Little by little, we have developed a range of services that we intend to expand. For example, we provide referral services for executive appointments in corporations as well as references for members of boards of directors.

We also act as a reference to various media looking for women to interview.

The network intends to participate actively in professional success and the outreach of its members, and offers many choices to all Quebec residents who wish to contribute to the socio-economic development of their communities.

The presence of women on boards of directors will bring about other changes in business for women. The Réseau des femmes d'affaires du Québec is in a process of becoming the official partner of We Connect Canada, a not-for- profit international organization.

Through the RFAQ, We Connect will enable Quebec businesses to create new business opportunities and establish partnerships with other recognized companies in order to increase their access to significant procurement contracts. The organization was created to certify the businesses that are run and controlled by women.

By certifying a company that is 51 per cent owned by a woman, We Connect is opening the door to numerous business opportunities in all countries where there is a policy to respect diversity and protect women. This initiative is part of the network's action plan and its aim is to enhance the work of women and their role as a driver of the economy in both Quebec in Canada.

We hope that this attempt at identification and certification will be a great step ahead to ensure that women will be present as suppliers of governments and large corporations.

Quebec adopted legislation aimed at gender equality within state corporations. Since 2009, Quebec has benefited from a procedure for establishing a better balance with regard to equal pay for men and women. In February 2011, the Quebec government will conduct public consultations on governance. These consultations bear the title of Pour que l'égalité de droit devienne une égalité de faits vers un deuxième plan d'action gouvernemental pour l'égalité entre les hommes et les femmes. (Ensuring that equality in law becomes equality in fact: Toward a second government action plan for gender equality.)

If during 2011 women could rely on federal legislation to ensure gender equality within boards of directors, as is the intention of Bill S-206, women could contribute more substantially to Canada's economic development.

We are aiming to establish gender equality in economic activities as a whole. We know that some countries have adopted legislation in order to implement quotas and that other countries are also aiming at gender equality. The Canadian government should join the countries that have adopted leading-edge legislation so that it can influence all other countries by adopting legislation that enshrines the principle of gender equality in laws such as those proposed by Bill S-206, such as legislation that covers the fields of stock market investment, banking, insurance, cooperatives and state corporations functioning as parent companies.

The power of women has now been recognized in the business world. Access to education and to a profession only began in the early 20th century, and it is only after a long battle that women obtained the right to vote in 1940. Submission to the husband and the absence of rights disappeared only recently.

Today, women with degrees and women in university are an important pool that includes training, skill and ambition. If a law can ensure gender equality, our members and women at large have the needed skills to seize such opportunities.

The Canadian government, as a good parent, would do better if it preached by example and if it was the first to ensure the presence of women entrepreneurs in the Canadian economy by implementing measures that would guarantee that companies run by women have access to government contracts and become suppliers to the government.

Measures such as creating a central registry of companies that deal with the government and the inclusion of a report on gender rights in all reports and registrations of companies would allow us to measure the progress we are making in gender equality in the business world.

In every sector where women are present in large numbers, we must encourage them to rise to the level of the board of directors. Finally, besides the greater availability of female employees, bank management seems to be convinced that they have an advantage in putting women at the head of their institutions so as to better respond to their clients' needs.

According to Sue Calhoun, the president of the Canadian Federation of Business and Professional Women's Clubs, women are finding their way to the top of the banking world more easily because they have understood that it is to their advantage to allow more women access to their organizations and boards of directors.

Given the fact that in Canada women are the owners of almost one-half of SMEs and consequently represent a large part of the banks' clientele, Sue Calhoun emphasizes that banks have an interest in appointing women to key positions in order to better serve their clients.

A strong concentration of female workers in finance and insurance companies would make such appointments easier and would justify them — according to Sue Calhoun — because women employed by banks need paths along which they can advance in their careers.

Given the current appointment practices, we know that the inclusion of more women in management has much to do with the inclusion of more women in governance. Our network of economically very active business women must meet the challenge of solidarity. For this purpose, we support every effort that is made to ensure gender equality. It seems to us that the old boys' clubs are still around in the business world.

We agree that a mixture of genders will be profitable for companies because it would enhance the value of feminine qualities that are considered to be complementary to masculine qualities. By contributing qualities such as communication or listening, women could transform companies and make them more human.

Legislation that would guarantee women access to upper management would allow women to fulfill their potential in the economic spheres. Gender equality in boards of directors will have a cumulative effect.

Many other legislative provisions could be included, more specifically programs that would favour companies owned by women in the procurement of governments, state corporations as parent companies, financial institutions, cooperatives and companies that sell shares on the stock market.

During this period of financial and economic turbulence, many would say that this is not the right time to change the rules governing boards of directors. However, in fact, when is it time to do this? We know that periods of uncertainty cause changes in the habitual behaviour of companies and consumers.

In every field, we are reassessing our methods, studying offers of service from current partners. It is time to allow change to happen, to try new things and to try to purchase new products and services. We must create new opportunities. We must dare to stand up for our rights to be different so that we can make a difference.

The Chair: Thank you, Ms. Vachon.

[English]

The Chair: First, I will express my apologies to all witnesses through this video conferencing. While it is a wonderful that you do not have to come all the way to Ottawa, the bad thing is that apparently it is impossible to introduce into it simultaneous translation; at least we have not been able to do so today. I apologize to you, Ms. Pfeiffer, and to you, Ms. Vachon, because all of us have the benefit of simultaneous translation and you do not. That is very regrettable.

Ms. Pfeiffer, I could not possibly summarize what Ms. Vachon said other than to say quickly, for the purposes of our discussion with you and others, that her organization is very active in aiding and abetting the access of women to posts, both administrative and board of directors, in major corporations, principally in Quebec. Ms. Vachon is in favour of Bill S-206.

I do not want to go any further because I risk putting words into people's mouths and that is not my job.

I will ask Madam Vachon whether she sees an advantage to 50-50 parity, as presented in the bill, the importance of a critical mass of 30 per cent to 40 per cent, which some other countries have done, as discussed by a previous witness.

[Translation]

Ms. Vachon or Ms. Lacoste, would you have any comments about the difference between the two concepts and the advantages of each one? As we only have 25 minutes left in the question period, I would ask you to make your presentation brief.

Justine Lacoste, Lawyer, Réseau des femmes d'affaires du Québec: I am a lawyer and I obtained an MBA in 1972. I have been a member of the Réseau des femmes d'affaires du Québec since 1981, I am the editor of the magazine Les propos and I am in charge of the governance sector. I have given training courses in governance in the professional development program of Laval University.

I would like to draw your attention to two benefits that these laws have provided. First, my great-aunt, Justine Lacoste Beaubien, founded Hôpital Sainte-Justine. This could not have happened if the Quebec government had not passed a bill discharging husbands of any liability for anything for anything their wives did as members of the Sainte- Justine board of directors.

My mother, Marcelle Émond Lacoste, was admitted to the bar in 1936, at a time when women were not being admitted to the bar. It was thanks to a law passed in 1942 that she was able to become a lawyer.

I would also like to draw your attention to an opinion issued by the Quebec Conseil du statut de la femme in December 2010: La gouvernance des entreprises au Québec: où sont les femmes? [Business governance in Quebec: where are the women?] I would like this report to be included in the documents this committee will be considering in its study.

This document presents many statistics about women and boards of directors. First, I would like to quote the following:

. . . during the most recent period, the percentage of women on boards of directors of the largest companies in Quebec has increased at an average yearly rate of 7.37 per cent. At this rate, we will have to wait another 16 years before obtaining equal representation of men and women within boards of directors.

I would also like to draw your attention to the problems that this legislation initially created in Norway. Let me quote a speech by Ms. Brown, the Director of Women on Boards at the Oslo conference.

[English]

In Norway, there was nationwide uproar when the law was proposed by Angsar Gabrielson, Minister for Trade and Industry, in 2002 and approved by Parliament in 2003. There were vociferous objections and heated debates that there were not enough qualified women to fill the quota, that women would not be appointed on merit and that they would end up with unsustainable numbers of board roles.

[Translation]

Ms. Vachon has just reassured you that in Quebec there are many women, and probably also in Canada, there are many women who are qualified and who have followed the training offered by Canadian universities. I would like to quote another excerpt from Ms. Brown's speech.

[English]

Legislation was the only way to force companies to change and address the gender imbalance on Norwegian public listed company boards.

The Quota Law has played a pivotal role in making women's talent and experience visible.

Women appointed under the law have brought greater diversity of skills and backgrounds to boards.

The governance of Norwegian companies has been improved with a greater focus on selection criteria for all directors.

The development of gender diversity in management is now seen as more important due to the high profile of women in board roles and the need to increase numbers of potential directors.

[Translation]

I would also like to quote an excerpt from a study in which Professor Claude Francoeur participated.

[English]

Taking risk and complexity into consideration is important given Ryan and Haslam's (2005) results. They conclude from their archival study that women are often appointed to leadership positions under problematic organizational circumstances associated with greater risk of failure and criticism, which suggests the existence of a ``glass cliff.''

Our results indicate that firms operating in complex environments that have a high proportion of women officers do experience positive and significant monthly abnormal returns of 0.17 per cent, which can intuitively be extrapolated to a 6 per cent return over 3 years. . . . On the other hand, having more women on corporate boards or on both corporate boards and top management does not seem to generate significant excess returns. This fits the viewpoint of agency theory and means, in fact, that firms with a high proportion of women in both their management and governance systems create enough value to keep up with normal stock-market returns. However, given the ``glass cliff'' hypothesis, this might even mean that female directors outperform their male counterparts because, compared to men, the positions women are given may be less promising to start with.

[Translation]

I could continue and quote more statistics.

The Chair: Let me remind you that we have very little time. We only have 15 minutes left now.

Ms. Lacoste: Yes, we will table all the documents. The documents will be tabled with a copy of the report from the Conseil du statut de la femme on governance, along with a copy of documents on the access of women to economic power.

The Chair: Excellent, thank you. Now let us go on to the question period.

[English]

Ms. Pfeiffer, I apologize for the lack of simultaneous translation. Do you have any comments to make on the English remarks?

Ms. Pfeiffer: My colleagues in Quebec have been thorough with their statistics, and I do not want to be redundant. They are right, and I would prefer to answer questions that, I believe, would serve your purpose better.

The Chair: I will ask this question in both English and French, as I would like a comment from all the witnesses on the advantages and disadvantages of parity versus critical mass.

[Translation]

Does gender equality present any advantages at all as opposed to a critical mass?

Ms. Lacoste: Chances of achieving success should be equal for women and men and no quota should be imposed.

The Chair: Then what should we have?

Ms. Lacoste: Equality.

The Chair: Equality in all companies. No more women than men, nor vice versa, is this what you mean?

Ms. Lacoste: Exactly.

[English]

The Chair: Ms. Pfeiffer, did you understand that comment?

Ms. Pfeiffer: Yes, I understood with my Grade 11 French.

The Chair: Your Montreal colleagues are advocating parity in all enterprises and not critical mass, whereby at least 30 per cent to 40 per cent would be of one gender.

Ms. Pfeiffer: Yes, if we go for the lowest common denominator, we will only go down from there. Results have shown that where there are more women on boards in senior management, there is a greater rate of success. I do not think it helps the situation to discuss whether that is 40 per cent or 40.25 per cent or whatever. Of course, I will say parity to begin with because that is where we should start and then go from there.

The Chair: My point is simply that if you say it has to be a minimum of 40 per cent it would mean there could be 60 per cent women. If you say 50-50 parity, there could never be 60 per cent women. Am I wrong?

Ms. Pfeiffer: I will always go with your higher number. I think there should be equality.

Senator Ringuette: Ms. Pfeiffer, you indicated that you were on a board of one of the oil companies. Is that correct?

Ms. Pfeiffer: No, I was in senior management in the oil companies, specifically with Shell Canada and Suncor.

Senator Ringuette: Perhaps I am biased, but I have always seen that particular industry as a little macho. How do you think the oil industry would accept parity?

Ms. Pfeiffer: Let me tell you that they would not accept it willingly. I think your perception is correct. It has been described as an old boy's club. I might suggest that, in terms of board composition, in some cases, it is incestuous. Having said that, however, I can tell you that, where there was more than one woman in senior management or the executive ranks, there was a greater success rate. I did not suffer unduly at all in my positions with those organizations.

Senator Ringuette: Your experience is that when there were more women on the executive, the fairness of treatment for management was higher. Is that your personal experience?

Ms. Pfeiffer: Yes, that is correct. I would also suggest to you that my concern in the oil and gas industry is that there are too many of the same people at the same tables.

Senator Ringuette: They tend to be in the same circle.

Ms. Pfeiffer: Yes.

[Translation]

In our documents, we also propose limiting the number of mandates to four simultaneous mandates per board member as this would be beneficial for increasing the number of positions open to women.

Senator Ringuette: My next question is directed to Ms. Lacoste and Ms. Vachon. Regarding the Quebec bill that seeks gender equality in state corporations this year, was the Réseau des femmes d'affaires consulted in order to offer candidates for some of these positions?

Ms. Vachon: Yes, almost in every case. However, we note that even before consulting us, the decision has often been made.

Senator Ringuette: I beg your pardon?

Ms. Vachon: We are consulted on a regular basis, but I notice that when we are consulted, the decision has often been made already.

Senator Ringuette: Do you mean that the names of competent candidates that you supply are not being considered?

Ms. Vachon: Yes. In cases where they ask for our opinion, they accept our suggested candidates, but in cases where they consult with us to see what organisations or persons we might suggest, these things have often already been decided. When they call on us, it means that they have already made their decision.

[English]

Senator Ringuette: Ms. Pfeiffer, I have been asked to translate my question for you. My question to the Réseau des femmes d'affaires du Québec was whether they had been consulted in regard to the current Quebec legislation for Crown corporations to have parity in their directorship. The answer from them was that yes, they were consulted, but after the decision had been made. There is another circle there too.

Ms. Pfeiffer: Yes.

Senator Frum: I want to follow up on the idea that just came up about too many of the same people around the same table and the suggestion of a maximum of four mandates. I believe there is no provision in Bill S-206 to limit mandates. This brings up an interesting problem with this bill. As you correctly point out, to achieve the effect that this bill wants to achieve, you do actually need to put quotas on the women who serve on boards.

As you observed quite correctly, right now you have an elite cadre of women who serve on corporate boards. Nothing in this bill would prevent the creation of this tiny slice of society where you get a super-elite group for whom this bill is an enormous boondoggle because they are the ones who will continually be asked to serve on boards. You have just entrenched a certain slice of society, and you have made it easier for them to sit on the top.

Senator Hervieux-Payette: The legal adviser to our committee, asked me to put that provision about the number of board mandates in another bill. The other bill is before the Senate. It is already tabled. We have to discuss these two questions separately. There are some rules on what we can put in a bill, and I was prevented from doing that. The remuneration of people on boards, the remuneration of officers and the number of years for a mandate and the number of boards they can sit on will be in the other bill. You are welcome to study it.

Senator Frum: You are reinforcing precisely my fears that this bill just becomes a domino for all kinds of other government legislation to limit the freedom of private enterprise. That is my question.

Ms. Pfeiffer: I would certainly agree that it would have a domino effect on other pieces of legislation. However, if it is the right and proper thing to do, we should not be fearful of that.

Ms. Lacoste: We support what she has just said.

Senator Frum: Again, all of our witnesses, including the prior one that you were unfortunately unable to hear, have touched on the idea that one of the reasons this is a good piece of legislation is that it is good for business. It is business's interest to have a more feminized corporate structure, and I completely agree with that. I think that is true. However, if you really believe this, and if you trust in the idea that it is better and more profitable for businesses to have a more diverse representation, why is it government's role to micromanage businesses and their business outcomes? One of the arguments is that this is a value proposition for businesses. If they cannot figure that out themselves, is that not their problem?

Ms. Pfeiffer: I will let my Quebec colleagues speak to that. In my remarks, I said that I was fearful of the intrusion of government into private industry.

Senator Frum: I liked that part of your testimony.

Ms. Lacoste: I think it is looking at this legislation in the wrong way. This legislation is a step forward for women, whatever the impact. When the government granted the vote to women, they did not need proof that it would make a better government. This is a bill in favour of having women participate equally in the economy of Canada.

Senator Hervieux-Payette: I would like to make these comments for the benefit of my colleague who was not present when I made my presentation. After conducting a study, you have to know how the publicly traded companies are funded. We know that over 80 per cent are funded with pension funds, to which, of course, women contribute equally. In fact, an ordinary citizen — even men right now — certainly does not like the way things are moving because the shareholder does not have more say in the governance of companies given that all the votes are aggregated. They are so aggregated that 125 per cent of votes are received when the shareholders are consulted because the system does not work properly.

In this case, I see that we have the proper training and the proper numbers, but we have no representation as Canadian citizens and as contributors to these funds. These gigantic assets are governed by men only, and women will be affected when decisions are made because the shareholders now have no say.

As far as I am concerned, a director is someone who represents the shareholder. As legislators, we should be reminded of that. Actually, with respect to those who are electing these people — and if you receive your proxy you know very well — if you cast a thousand votes on any company it is totally insignificant. You have no say in the future of this company. Therefore, we have to rely on at least a representation of the Canadian population and those who are in fact financing these companies. This is the purpose of the bill.

I see the same thing in the governance of unions and pension funds. We are not represented, even though when we contribute to the fund we contribute as equally as men do. I think it is an issue of fairness.

What is the role of government? The role of government usually is to redistribute power equally and fairly among the different groups. That is where we start. It is not a matter of intruding into private things. There is no such thing as a private thing when you talk about a company. The company is actually everyone, the public, contributing as shareholders. Millions of people are contributing and only one part of our population is represented on the board.

That was initially the intention behind the bill. I am sorry, but this is something that I proposed. That is why I campaigned for that. As a woman, with daughters, I feel we should all participate in this society. I checked with my colleagues who I know can understand English. It is right that we were given the vote and we were not asked if we were qualified to vote. You know very well as a senator that it took us some time to become a person in this country. It took some time for women to be able to sit in the Senate.

Year after year, we have to consider that we have to intervene to ensure this society functions properly.

[Translation]

The Chair: Thank you for your intervention, Senator Hervieux-Payette. Let me give the last word to the witness. Ms. Pfeiffer and her Quebec colleagues will have the last word.

[English]

We are just about out of time so please go ahead if you have anything to add.

Ms. Lacoste: We have an equal right to success, we have an equal right to economic power and we have an equal right to be heard. Therefore I am all for this bill.

The Chair: Somehow that came through loud and clear.

Ms. Pfeiffer: I would suggest to you that the women in the West feel exactly the same way as our colleagues in the East do, and I commend the senator for being as eloquent in her speech as she was in terms of participation of women. I would be remiss if I did not tell you that I totally support this bill.

The Chair: Thank you very much. If you could translate that cooperation to other fields between the East and the West, probably all our problems in Canada might be solved. However, that is a debate for another day.

[Translation]

Let me thank our witnesses and offer my apologies for the usual problems with language and translation.

[English]

However, I feel we got along pretty well and we appreciate very much all three of you taking the time to give us your frank and helpful views.

With that, I will declare the meeting adjourned.

(The committee adjourned.)


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