With U.S. corporate scandals endlessly making the news, the need for better governance is paramount. But how effective is corporate governance in Canada? Nine experts from various disciplines discussed their thoughts at a roundtable today in Toronto.Although the panel agreed that the area of corporate governance has progressed over the years, the consensus was that there’s still more work to be done. “It’s an evolving process, not a fixed set of rules,” said Carol McNamara, vice-president and corporate secretary, RBC, which has ranked highly on the Globe and Mail’s annual report on corporate governance. RBC takes a prudent approach to governance, she said. It has limited majority votes, an independent chair leads the board, and the board and senior management enhance the flow and quality of the information.One area that needs particular attention is executive compensation. “It’s not just numbers on a chart,” said Globe and Mail columnist and reporter Janet McFarland. It’s the “justification” for the amount, the factors that the compensation is based on, she continued. In the U.S., the “say on pay” (in which stakeholders have input into how executives are compensated) is popular; however, it’s only in the beginning stages here in Canada.Another important area is director education. Beverly Lynn Topping, president and chief executive officer, Institute of Corporate Directors, said that although it may be difficult to find a direct link between director education and director effectiveness, that doesn’t mean it doesn’t exist. “Director education does matter,” she said. “Better directors mean better boards and better business.”The panel also agreed that enforcement could be more effective. “The weakest link is the white collar crime,” said McFarland. “We need to focus and find meaningful enforcement—not just the securities commission enforcement.” She raised the idea of having one national enforcement body. Other panelists agreed.Although some CEOs may balk at the millions spent on compliance, the benefits outweigh the costs. “What is the cost of not doing it?” asked Alex Brownings, vice-president of finance and chief financial officer, LCBO.Organizations must be proactive in integrating good corporative governance into their business practices. “We need a culture of integrity,” Brownings said. “Not simply reliance that auditors will detect or protect against fraud or malfeasance.”

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