Shareholders of Canadian public companies had their first opportunity to gain a “say on pay” at CIBC’s annual general meeting held today, with a reported 44.96% of shareholders voting in support of adopting an annual non-binding advisory vote on executive compensation. The proposal, brought forward by Meritas Mutual Funds with support from SHARE, is the first of its kind in Canada. Gary Hawton, Meritas CEO, was emboldened by the results, explaining “These results are incredibly strong given that first time proposals typically receive about 7% of the vote. To have so many investors join with us in support of this proposal will send a strong message to publicly traded companies in Canada as well as to securities regulators.”
It remains uncertain whether CIBC will choose to incorporate the non-binding vote, according to Chairman William Etherington the bank will continue dialogue on the issue. Having an advisory vote would not affect actual compensation paid to executives, but rather is intended to let shareholders clearly express their views of executive compensation.
Proposals for an advisory vote on executive compensation will also be presented and voted on at upcoming annual meetings of the remaining major banks: Royal Bank of Canada (February 29), Bank of Montreal (March 4), Bank of Nova Scotia (March 4) and Toronto-Dominion Bank (April 3).