Canada: governance in action

CCBC supports IBGC mission that promoted immersion in the country’s corporate culture.

By Sérgio Siscaro

In establishing its initiatives for 2022, the Chamber of Commerce Brazil-Canada (CCBC) made it very clear that it would continue to encourage businesses and solutions of an innovative nature that were sustainable from the environmental, economic and social points of view, that followed good compliance practices, and that promoted diversity. This way of acting, aligned with the practices adopted by the Chamber since before the environmental, social and governance (ESG) agenda gained ground in the country, has permeated all CCBC initiatives.

This includes support for actions that contribute to disseminating a culture of compliance in Brazil, with adherence to the best corporate governance practices available in the market. One of these initiatives was the 11th edition of the Technical Journey promoted by the Brazilian Institute of Corporate Governance (IBGC) – Instituto Brasileiro de Governança Corporativa, which took 60 Brazilian businessmen to Canada, between May 30th and June 16th.

Thematic Diversity

For many years, Canada has had several characteristics that qualify it as a country with a more mature governance culture. The mission, which was originally scheduled to take place in 2020 (but was postponed due to the spread of the Covid-19 pandemic), enabled the participants to experience and exchange experiences about governance in that country through technical visits to the cities of Toronto and Montreal.

In addition, the choice of the country was based on analyses made by an IBGC study group, which was supplied with information provided by the CCBC. The previous work done by the two entities allowed the pillars that would guide the programming of the mission to Canada to be established: innovation, finance, private sector, and academia.

Based on them, it would be studied how corporate governance in Canada impacts on diversity, regionality, immigration, and plurality. Once this “road map” was established, the participants would have a program that would include the Canadian innovation ecosystem; the financial structure, such as banks, pension funds, and capital markets; various sectors of private enterprise, including family businesses; and the activities of the country’s government and university sector.

This framework allowed an in-depth analysis of corporate governance, taking into account its relevance in two distinct cultures: that of Anglo-Saxon Canada, in Toronto, and that of the Francophone area, in Montreal. The differences between the two, and the ways in which companies seek to conform to both, allowed for a more panoramic view of how the topic is approached in Canada. 

Organized into two classes, the participants were able to participate in discussions on a wide range of topics, including Brazil-Canada relations, finance, diversity, the ESG agenda, corporate governance regulation, innovation, education, public policy, and legal issues. In addition, they had direct contact with family-owned companies in the country, universities, regulatory bodies, innovation centers, governance institutes, and stock exchanges, among others.

Starting in 1998, IBGC’s program of visiting other countries to learn about their corporate governance models has already included Germany, Australia, Singapore, the United States, Finland, France, Israel, the United Kingdom, Sweden, and Hong Kong, China.

ESG put into operation 

Discussions have been growing in Brazil, for some years now, about the adoption of an ESG agenda by companies. While this debate is often still in the world of ideas, in Canada the participants of the 11th Technical Seminar were able to see these principles being applied in practice.

Another point that caught the attention of participants was how governance is put at the service of innovation in Canada – contributing to a more effective integration between the contributions of private companies, government and academia. The visits to companies, research centers and universities showed how the three players act in synchronized fashion, allowing the development of more and better innovative technological solutions.

Canada is characterized as one of the countries that is most advanced in the adoption of responsible corporate practices, aimed at meeting the needs of the various stakeholders. Unlike Brazil, Canada has less recourse to legislation as a means of regulating relations between companies and shareholders.

The corporate governance structures are more “decentralized” – which is explained both by the federative nature of the country and by its culture, which is more focused on granting freedom to economic agents. Cooperation is encouraged between government authorities, private sector entities, and professional associations, which establish the most appropriate regulations for each sector, taking into account the demands and needs of the various stakeholders.

The concern to act in this way is also present in the Canadian capital market, since there is increasing pressure from society for companies to disclose their information on themes linked to ESG criteria. Toronto’s TSX and TSX Venture Exchange have governance training programs for listed companies and adhere to international initiatives such as the United Nations’ Sustainable Stock Exchange Initiative (UN).