Canada’s boardrooms, and strong corporate governance culture, may be a growing competitive advantage in attracting investment capital.
2024 has seen much debate in the U.S. regarding the possibility and implications of “Dexit”.
This is the phenomenon of some U. S. companies deciding to redomicile out of Delaware and into another U.S. state, such as Texas or Nevada.
The genesis of the issue is certain high-profile U.S. companies taking issue with Delaware’s corporate law and courts, which they believe have become overly friendly toward smaller shareholders.
This has prompted a race between Delaware, Texas and Nevada to dilute their corporate governance law in a manner that (1) is less favourable to minority shareholders, (2) is more deferential to large shareholders, and (3) takes a more relaxed approach to potential conflicts of interest.
This race to shed shareholder protections amongst these U.S. states highlights the longstanding strengths of Canadian boardrooms and corporate law.
In their Business Opinion in The Globe and Mail, Fasken partners Marie-Josée Neveu, Sean Stevens and Sarah Gingrich explain how this is something that more Canadian companies (and their current and potential shareholders) should know: that Canada’s corporate governance framework and shareholder protections are becoming a legitimate argument to help attract investors.
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The views in the Business Opinion are those of the authors.
