On February 13, 2014, the Toronto Stock Exchange (TSX) announced that it had received the Ontario Securities Commission’s approval to proceed with amendments to the TSX Company Manual (the 2014 Amendments) to require all TSX-listed issuers to adopt majority voting for the election of directors.

The 2014 Amendments will require that each director of a TSX-listed issuer be elected by a majority of the votes cast with respect to his or her election. This effectively means TSX issuers will need to adopt a majority voting policy. The majority voting requirements do not apply to majority-controlled issuers or to meetings at which the election of directors is contested. The 2014 Amendments will take effect on June 30, 2014. For issuers with a December 31 year end, this means they will need to comply with the 2014 Amendments next proxy season.

As set out in our bulletin from October 2012, TSX amends rules for election of directors, prior amendments to the TSX Company Manual already require a TSX-listed issuer to:

  • hold elections annually for all of its directors;
  • allow shareholders to vote for each individual director (rather than for a slate of proposed directors); and
  • disclose in its meeting circular whether the issuer has adopted a majority voting policy for directors at uncontested meetings and, if no policy has been adopted, to explain why.

A TSX-conducted survey of 200 listed issuers in the summer of 2013 found that 76% of the surveyed issuers had already adopted majority voting policies.

The full text of the 2014 Amendments can be viewed here.