Diversity of boards of directors and senior management

As of February 7, 2022, the guidelines have been enhanced to help you disclose information more clearly and consistently.

On this page

Who must disclose diversity information

Federal distributing corporations, including venture issuers, created under the Canada Business Corporations Act (CBCA), now need to disclose information to their shareholders and Corporations Canada on the diversity of their boards of directors and senior management teams.

A corporation's senior management team includes any of the following:

  • chair and vice-chair of the board of directors
  • president of the corporation
  • chief executive officer and chief financial officer
  • vice-president in charge of a principal business unit, division or function, including sales, finance or production
  • anyone who performs a policy-making function within the corporation.

Corporations have to report on the representation of 4 designated groups defined in the Employment Equity Act, on their board of directors and senior management teams:

  • women
  • Indigenous peoples (First Nations, Inuit and Métis)
  • persons with disabilities
  • members of visible minorities.

Reporting on the representation of these 4 designated groups is the minimum requirement. Corporations may choose to disclose information about any other groups they believe contribute to the diversity of their boards and senior management teams.

What information to disclose

Your distributing corporation has to disclose information about women, Indigenous peoples, persons with disabilities and visible minorities. It also has to either disclose information about its policies and targets for the representation of the designated diversity groups, or explain why it does not have a policy and targets.

The information to disclose includes the following:

  • Whether the corporation has adopted term limits or other mechanisms of board renewal;
  • Whether it has a written policy relating to the identification and nomination of directors from the designated groups, and if so, a description of the policy;
  • Whether and, if so, how your board or nominating committee considers diversity on the board in identifying and nominating candidates for election or re-election to the board;
  • Whether and, if so, how your corporation considers diversity when making senior management appointments;
  • Whether your corporation has targets for representation on the board and among senior management for each of the designated groups and, if so, progress in achieving those targets; and
  • The number and percentage of directors from each of the designated groups on the board and among senior management.

For details on the information that must be disclosed, refer to the Canada Business Corporations Regulations, 2001.

Benefits of having a diversity policy

One of the most significant steps to promote dialogue with shareholders about the benefits of diversity is to adopt a written policy relating to the representation of women, Indigenous peoples (First Nations, Inuit and Métis), persons with disabilities and members of visible minorities on the board of directors and among senior management. A written policy allows assessment of the corporation's current diversity and provides a basis for discussion on ways to improve diversity.

Visit the 50 – 30 Challenge page to find out about the benefits of having a more diverse organization and how to promote diversity on corporate boards and among senior management teams, including a toolboxFootnote 1 available to all organizations. You will also find information on how to participate on a voluntary basis in the 50 – 30 Challenge.

Guidelines

Background

Corporations Canada receives diversity information disclosure.

After the first 2 years of data collection, the following observations can be made:

  • Federal distributing corporations should be continuously encouraged to recognize the benefits of diverse backgrounds in decision-making.
  • Diversity information could be more effectively communicated if it is consistently disclosed in a common format. Consistency in disclosure will:
    • enhance shareholder/management dialogue about the benefits of diversity;
    • improve the comparability of information disclosed by various corporations, and help investors, shareholders and other stakeholders efficiently identify and assess relevant information concerning the corporation;
    • ensure that diversity information is collected and analyzed in a consistent way;
    • enable a sound year-over-year analysis that will foster steady progress toward more diverse corporate leadership.

Objectives

These guidelines are provided to encourage corporations to disclose their diversity information yearly in a more consistent manner. Corporations Canada will continue to receive diversity information disclosure and may provide additional guidelines in the future.

The guidelines are not intended to add any additional disclosure requirements.

Date of diversity information disclosure

Corporations are encouraged to clearly indicate the date of disclosure. This helps to delineate diversity information as of a certain date versus a future or past state of the corporation. For example, a corporation may disclose the information as of its financial year-end, as of the date of its management proxy circular or at any other date chosen by the corporation.

Example: The diversity information disclosed in this document reflects the corporation's situation as of January 20, 2022.

Guidelines details

Term limits for directors or other mechanisms of board renewal

Corporations must disclose whether they have adopted term limits for directors (either an age limit or a tenure limit) or other mechanisms of board renewal. Corporations are encouraged to present this information in a table format.

See table below as an example:

Term limits for directors or other mechanisms of board renewal
Age limit Tenure limit Other mechanisms of board renewal
[Indicate the age limit or "None".] [Indicate the tenure limit or "None".] [Describe the mechanisms of board renewal adopted by the corporation, or indicate "None" if the corporation has not adopted other mechanisms of renewal.]

If the corporation has not adopted term limits for directors or other mechanisms of board renewal, it must specify this and explain why it has not done so.

Example: The corporation has not adopted term limits for directors or other mechanisms of board renewal for the following reasons: [Indicate the reasons].

Written policy relating to the identification and nomination of directors from the designated groups

Corporations must disclose if they have adopted a written policy relating to the identification and nomination of directors from the designated groups.

If the corporation has adopted one, it must disclose the following information:

  • A summary of the policy's objectives and key provisions;
  • The measures taken to ensure that the policy is effectively implemented;
  • A description of progress made toward achieving the objectives of the policy during the year and since implementation;
  • Whether the board or its nominating committee measures the effectiveness of the policy and, if so, a description of how it is measured.

If the corporation has not adopted this type of written policy, it must specify this and explain why it has not done so.

Example: The corporation has not adopted a written policy relating to the identification and nomination of directors from the designated groups for the following reasons: [Indicate the reasons].

Consideration of the level of representation of designated groups

Board of directors

Corporations must disclose whether the board or its nominating committee considers the level of representation of designated groups on the board in identifying and nominating candidates for election or re-election to the board.

If the board or nominating committee does consider it, the corporation must specify this and explain how it takes this into consideration.

Example: The board of directors or its nominating committee considers the level of representation of [indicate the designated groups that the board or its nominating committee considers] on the board in the following way: [Indicate how the board or its nominating committee considers the level of representation].

If the board or its nominating committee does not consider it, the corporation must specify this and explain why it does not do so.

Example: The board of directors or its nominating committee does not consider the level of representation of [indicate the designated groups] on the board for the following reasons: [Indicate the reasons].

Senior management

Corporations must disclose whether they consider the representation of designated groups in senior management when appointing members of senior management.

If the corporation does consider it, the corporation must specify this and explain how it takes this into consideration.

Example: The corporation considers the level of representation of [indicate the designated groups considered by the corporation] in senior management when appointing members of senior management in the following way: [Indicate how the corporation considers the level of representation].

If the corporation does not consider it, the corporation must specify this and explain why it does not do so.

Example: The corporation does not consider the level of representation of [indicate the designated groups] in senior management when appointing members of senior management for the following reasons: [Indicate the reasons].

Targets for representation of designated groups on the board and among senior management

For each of the designated groups, corporations must disclose whether they have adopted targets for representation on the board and among senior management, the expected timeframe for achieving the targets, as well as progress made toward achieving the targets during the year and since its adoption.

Corporations are encouraged to:

  • present the information in a table format (see example provided below);
  • disclose targets for representation of designated groups on the board of directors separately from targets for representation among senior management. Targets can be a:
    • number (for ex., at least 3 directors out of 10);
    • percentage (for ex., 50%);
    • range of target numbers (for ex., at least between 3 and 5 directors out of 10);
    • range of target percentages (for ex., at least between 30 and 50%);
  • indicate a timeframe for each target (for ex., "within 5 years" or "by 2025");
  • describe the progress made toward achieving each target (for ex., The board now includes 20% women, which is a 10% increase over the year 2021 and a 10% increase since the adoption of the target. The target is gender parity by 2025.);
  • indicate if no target has been adopted for a designated group and explain why the corporation has not adopted a target;
  • indicate, although not a requirement, if the corporation has adopted targets:
    • for any other groups it believes contribute to the diversity of their boards and senior management teams and, if it chooses to disclose this information, present these targets separately;
    • beyond the senior management team (for ex., among executive positions or on the total workforce) and, if it chooses to disclose this information, present these targets separately from the targets for the senior management team.

See tables below as an example:

Targets for representation of designated groups on the board of directors
Designated groups Target Expected timeframe to achieve target Progress toward achieving target
Women [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Indigenous peoples [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Members of visible minorities [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Persons with disabilities [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Targets for representation of designated groups among senior management
Designated groups Target Expected timeframe to achieve target Progress toward achieving target
Women [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Indigenous peoples [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Members of visible minorities [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]
Persons with disabilities [Indicate expected target] [Indicate expected timeframe] [Indicate progress made]

If the corporation has not adopted a target for representation of a designated group, the corporation must specify this and explain why it has not done so.

Example: The corporation has not adopted a target for the representation of [indicate the designated group(s) for which the corporation has not adopted a target] for the following reasons:  [Indicate the reasons].

Representation of designated groups among boards of directors and senior management teams

Corporations must disclose the number and percentage of members from each of the designated groups on the board and among senior management.

Corporations are encouraged to:

  • present the information in a table format (see example provided below);
  • disclose the number and percentage of directors from each of the designated groups on the board of directors separately from the number and percentage from each of the designated groups among senior management;
  • indicate the total number of directors on the board and the total number of members of the senior management team as of the date of disclosure;
  • indicate both the number and the percentage of members of each designated group:
    • who hold a position on the board of directors as of the date of disclosure;
    • who are among senior management of the corporation, including all of the corporation's major subsidiaries, as of the date of disclosure;
  • proceed as follows if an individual is a member of more than 1 designated group:
    • Include that individual in both the number and the percentage for each of the designated groups of which the individual is a member;
    • Indicate the total number of individuals who are members of more than one designated group in order to provide clarity in situations where the sum of the members of each designated group is greater than the total number of members of the board or of the senior management team;
  • indicate clearly if there are no members of a given designated group that hold a position on the board of directors or are among senior management as of the date of the disclosure;
  • provide the following information, although not a requirement:
    • Disclose diversity information for any other groups it believes contributes to the diversity of their boards and senior management teams, and if it chooses to disclose this information, present it separately;
    • Disclose diversity information beyond the senior management team (for ex., among executive positions or on the total workforce), and if it chooses to disclose this information, present it separately from the information about the senior management team;
    • Demonstrate progress on its corporate diversity by disclosing information regarding the future composition of the board of directors (for ex., nominees for directors) or among its senior management team (for ex., candidates for promotion to senior management), and if it chooses to disclose this information, present it clearly and separately from the information about the board of directors and the senior management team as of the date of disclosure.

See tables below as an example:

Total number of directors on the board of directors and senior management members
Board of directors [Indicate the total number of directors]
Senior management [Indicate the total number of senior management members]
Representation of designated groups on the board of directors
Designated groups Number Percentage
Women [Indicate the number] [Indicate the percentage]
Indigenous peoples [Indicate the number] [Indicate the percentage]
Members of visible minorities [Indicate the number] [Indicate the percentage]
Persons with disabilities [Indicate the number] [Indicate the percentage]
Number of individuals that are members of more than one designated group [Indicate the number] [Indicate the percentage]
Representation of designated groups among senior management team
Designated groups Number Percentage
Women [Indicate the number] [Indicate the percentage]
Indigenous peoples [Indicate the number] [Indicate the percentage]
Members of visible minorities [Indicate the number] [Indicate the percentage]
Persons with disabilities [Indicate the number] [Indicate the percentage]
Number of individuals that are members of more than one designated group [Indicate the number] [Indicate the percentage]

How to disclose diversity information to Corporations Canada

Distributing corporations must send their diversity information at the same time to:

  • shareholders, with the annual meeting notice, and
  • Corporations Canada.

Afterwards, corporations must present this information at their annual meeting.

How to send the diversity information to Corporations Canada

Your corporation may choose to include the diversity information in its proxy circular (free). If so, the simplest way to send the information to Corporations Canada is through the Online Filing Centre or by email to ic.corporationscanada.ic@ised-isde.gc.ca.

Note: Even if you file the proxy circular with SEDAR, you also have to file it with Corporations Canada. The exemption from the filing of certain documents does not apply to management documents that are subject to diversity disclosure requirements. Diversity disclosure requirements under the CBCA are broader in scope than what must be disclosed under provincial securities legislation.

Information filed with Corporations Canada is available to the public.

Laws and regulations

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