Canada's Original Think Tank

Second reading of Bill C-25, An Act to amend the Canada Business Corporations Act, the Canada Cooperatives Act, the Canada Not-for-profit Corporations Act, and the Competition Act

Second reading of Bill C-25, An Act to amend the Canada Business Corporations Act, the Canada Cooperatives Act, the Canada Not-for-profit Corporations Act, and the Competition Act

Second reading of Bill C-25, An Act to amend the Canada Business Corporations Act, the Canada Cooperatives Act, the Canada Not-for-profit Corporations Act, and the Competition Act

Hon. Serge Joyal: 

Honourable senators, I want to take part in this debate because I feel that sometimes there are bills introduced in the Senate that appear to be what I call kitchen bills, that is, bills which are aimed at streamlining procedure and housekeeping.

Bill C-25, in my opinion, is not a housekeeping bill. Bill C-25, to amend the Canada Business Corporations Act and others, at page 9,Part XIV.1 titled “Disclosure Relating to Diversity,” raises a fundamental constitutional issue.

When we have a bill, the first question is to try to put it in the perspective of the values that underpin our system. The values that underpin our system, especially in relation to diversity, are two specific sections of the Charter:

27. This Charter shall be interpreted in a manner consistent with the preservation and enhancement of the multicultural heritage of Canadians.

That is, diversity; and:

28. Notwithstanding anything in this Charter, the rights and freedoms referred to in it are guaranteed equally to male and female persons.

In other words, the values that underpin legislation must reflect or take into account the preservation of the multicultural heritage of Canada, and of course the enhancements and the guarantee equally to male and female persons.

When I read Part XIV.1 on page 9 of this bill, I came to the conclusion that in fact this bill is far below the expectation of the policy of the government. What is the policy of the government? It was well stated by the Prime Minister in September: This government is unequivocal in defence of women’s rights.

I repeat: This government is unequivocal in defence of women’s rights.

My concern is that this bill affects women’s rights and their position in the economy where the Canadian government has a say, because this bill regulates business corporations. That’s part of the title of the bill.

I remind you that 50 years ago in this chamber, the Report of the Royal Commission on the Status of Women, chaired by Florence Bird, was tabled. Some of you remember her. She was a broadcaster, journalist and author. She was the first woman to chair a royal commission in Canada. That report contains specific reference to women in the economy. I want to read parts of that report because they apply to the present circumstances raised by Bill C-25.

In paragraph 11, on page 21, Florence Bird stated:

It is common knowledge that few women . . . reach the top of the ladder in the business world. They are seldom found on corporation Boards of Directors or have seats on stock exchanges.

Later in the same report, paragraph 46, on page 29:

There is no doubt that changes should be made in the composition of Boards of Directors of corporations so that there will be a more equitable sex distribution of decision-making power in the business world. Neither is there any doubt that the absence of women at the top means that the country is ignoring many first-class minds and abilities.

Later, at paragraph 53:

Because they are not on corporate Boards of Directors [women] are not participating directly in any decision-making by corporations.

That was 50 years ago; not yesterday, not 10 days ago, not since the election of the present government. That was the perception and the conclusion of the Royal Commission on the Status of Women. Honourable senators, that commission received 900 testimonies, 1,000 letters, 468 briefs, and 160 recommendations. It is at the origin of what we call today the status of women policy in Canada.

I saw Senator McPhedran this afternoon. She was one of the proponents of section 28 of the Charter I just read, that women have a right to participate equally in the affairs of the nation.

You must ask yourself what role women have in this chamber to promote the status and the equality rights of women. Florence Bird was appointed a senator. She sat here from 1978 to 1983. She sat under the Liberal label, but in fact she was never a card-carrying Liberal in her life. In fact, she sat and spoke her independent mind.

I must remind you that abortion is not criminalized in Canada because of former Senator Pat Carney. She was a Progressive Conservative minister for many years. She was Treasury Board chair. She was Minister for International Trade and Minister of Energy, Mines and Resources. She sat in this chamber from 1990to 2008. It was her vote that killed the balance to make a tie that contributed to the defeat of the government legislation. That’s why abortion is not a crime in Canada today. She was a Tory, she was independent and she was at the origin, as Senator Munson said, of the right for women to choose for themselves. That, in my opinion, is an important element to remember.

Remember the Famous Five, memorialized by the statute that you pass when you enter this chamber. The Famous Five fought to be recognized as persons equal in status and rights, and the government of the day fought them. Mackenzie King fought them and he won in the Supreme Court, but he lost in London. Many of them would have wanted, of course, to sit in this chamber. Guess what happened? Mackenzie King was resentful and so instead of appointing one of the five he appointed Cairine Wilson, whose bust you see in the entrance here.

Women have played a very important role in this chamber to promote the ability not only to decide for themselves but to play a role in the economy.

When I listened to some of the comments about how women should not be token appointments to boards, let’s look at what’s going on in Europe. In 2015, Germany — which is not the smallest European country; in fact, it is the economic locomotive of Europe — adopted legislation to compel the composition of boards of directors such that by 2016,30 per cent of appointments were women, and by 2018 it will be 50 per cent. Do you want to hear the names of some German companies? They include Volkswagen, BMW, Daimler, Siemens, Deutsche Bank, BASF, Bayer and Merck: The boards of all of those big German companies were compelled to have 30 per cent female membership by 2016 and 50 per cent by 2018.

Here is something very funny, honourable senators. The Bombardier C Series was sold to Airbus. I don’t know if you remember when that happened three weeks ago. Who is the owner of Airbus? It is France, which has similar legislation, imposing 50 per cent female membership on that company’s board. Spain is also an Airbus shareholder and has similar legislation. There is Germany, as I just mentioned, and that company has its head office in the Netherlands, another country that has a similar percentage of women participating on the board of directors.

We are in the funny situation that when the C Series was owned by Bombardier, there was no obligation for Bombardier’s board to include women. But they sold the C Series to Airbus and suddenly 50 per cent of the membership on the board that now rules the C Series are women. Do you think the value of the C Series is going down? No. I know many senators here, like myself, who have links with Canadian companies that have no obligation, but the same companies own others in Europe whose boards’ members are 30 or50 per cent women.

I see a smile on the face of the Government Representative, and I’m sure he understands what I mean.

In other words, it’s not because a company has an obligation to report that you have reached the target. In fact, there have been two studies comparing the Canadian situation with that of France because the preoccupation was that, of course, if you appoint women to boards, the quality of the membership might not be totally assured.

There was an important study led by Laval University that concluded the following in comparing the performance of companies in France and Canada in relation to board membership:

Ultimately, all of our results unequivocally refute the argument that imposing quotas will result in the deterioration of the human capital of boards of directors.

In other words, there is a perception maintained and entertained that if you push women too much, you downgrade the economic leadership of the company. That’s totally refuted by that study.

A similar study compared companies in Norway. Norway was the first European country to impose objectives for the participation of women, and they compared that with boards in the United Kingdom, which has the same policy as that proposed in this bill: comply or explain. What was the conclusion of the comparison between the United Kingdom and Norway?

. . . suggesting that the rapid growth in board diversity has been achieved without any fall in the quality of female directors. . . .

. . . our analysis . . . detects no ‘negative’ consequences of this initiative that may arise in the shape of the appointment of inexperienced women or a rapid growth in the numbers of appointments held by a given group of female directors.

I hope the Banking Committee will ask those people to come and testify, again, because we have to put this issue into perspective. Personally, honourable senators, I am of the conviction that a policy based essentially on “comply or explain” is a fake policy and a setback in the move to an equality of status for men and women.

In fact, that policy never gives you the guarantee that there will be results. That was true in an article from the U.K., where they have such a policy, titled “UK companies are recruiting fewer women to boardrooms as gender diversity progress stalls for first time,” which stated:

Of the new recruits to UK boards in 2016,29 per cent were women, down from 32.1 per centin 2014 and 31.6 per cent in 2012, according to a report which is published every two years by recruitment firm Egon Zehnder.

What does that mean? It means that the “comply and explain” policy is one that doesn’t guarantee movement. That is totally confirmed by the Chair of the Ontario Securities Commission. I want to quote her, because this seems to be what we have to keep in mind in reviewing this situation:

The number of Canadian women serving on corporate boards has inched up a mere one percentage point in the year since securities regulators first began ordering companies to track and disclose women in their ranks.

Of 677 companies listed on the TSX and analyzed by provincial regulators . . . women made up 12 per cent of all board seats, up from 11 per cent a year ago.

The Hon. the Speaker: Five more minutes. Is it agreed?

Hon. Senators: Agreed.

Senator Joyal: Thank you, senators.

Fifty-five per cent of the companies had at least one female director, up 6 per cent from last year.

But that means 45 per cent did not have a single woman.

I repeat: Forty-five per cent didn’t have a single woman. When I hear comments about the appointment of token women, a token woman is one person on the board. But if you have 30 or40 per cent female membership, there is no more token participation of women. Look at our chamber: There are 41 female senators out of 95. Do you think those 41 are token appointments? If we had one, she would be token but these 41 are not, because we are close to a fair balance.

I think the time has come, honourable senators, to set some targets. I’m not stupid; I know the economy. I’m involved in business and whatnot. We have to give a reasonable amount of time to move, but there has to be a direction, at least. In my opinion, we should set a target for 30 per cent in five years and 40 per cent after two more years. That is based exactly on where the European Union is heading.

Honourable senators, I want to quote to you a sentence from a book that Senator Wetston gave me for reflection on this issue, published last year.

Some Hon. Senators: Oh, oh!

Senator Joyal: Yes, we are on speaking terms. I’ll read this, page 167. I’ll read it slowly so that it remains in your minds:

It is up to men to consent to the addition of more women on boards and on management teams.

Think about this. The progress of women is essentially in the hands of men. Don’t you think it’s time that we study that deeply at the Banking Committee?

I want to thank Senator Wetston for this book, because the whole of the philosophy is there.

Some Hon. Senators: Hear, hear!

Senator Joyal: In this chamber, women got the right to control their bodies. Women got the right to sit in this chamber because they fought for it against the government of the day.

Fifty years ago it was suggested that the government should take steps to move women forward to the top level in terms of economic power. They are now at the level of political power. We have had the premier in British Columbia; we have one in Alberta, one in Ontario, one in Quebec, one in P.E.I. And we had one here in this chamber that was speaking last May, the Right Honourable Kim Campbell.

Women have been able to break through in the political world. They are now at the level of breaking through in terms of economic power, and it will be up to us, with this bill, to take the next step. That’s why, honourable senators, if the committee does not amend this bill to add some perspective, with a reasonable time frame to reach it, based on the experience of our partners in Canada and the European Union, and with the commitment of this government to be unequivocally feminist, we will have missed an opportunity.

That’s why I’m contemplating introducing an amendment at third reading if the honourable senators who sit on the committee don’t have the opportunity to review that at length and make the historical decision of where we want to bring women forward in terms of economic power. That is the question this bill raises.