Key Proxy Vote Survey · Element Financial Corporation 26-Jun-2014 Authorize and re-approve the...

Key Proxy Vote Survey

2014

Key Proxy Vote Surveyby Catherine Smith, Senior Research Analyst and Manager of Proxy Voting Services, SHARE

The Shareholder Association for Research and Education (SHARE) coordinates and implements responsible investment practices on behalf of institutional investors. Since its creation in 2000, SHARE has carried out this mandate by providing responsible investment services, including proxy voting and engagement services, as well as education, policy advocacy, and practical research on emerging responsible investment issues.

The Columbia Institute fosters individual and organizational leadership for inclusive, sustainable communities. This work is rooted in our belief that communities who value social justice, the environment, and their local economy are healthier, happier places to live. We build capacity through responsible investment, governance training and key public policy research.

Created in 1983, the Fonds de solidarité FTQ is a development capital fund that calls upon the solidarity and savings of Quebecers to help fulfill its mission to contribute to Québec’s economic growth by creating and protecting jobs through investments in small and medium-sized businesses in all spheres of activity. The Fonds also seeks to encourage Quebecers to save for retirement and to offer its over half a million shareholders-savers a reasonable return over and above the outstanding tax benefits they receive by purchasing Fonds shares.

© 2015 Shareholder Association for Research and Education, the Columbia Institute, and the Fonds de solidarité FTQ

1055 West Georgia Street, 26th floor, PO Box 11171, Royal Centre, Vancouver, BC V6E 3R5 T 604.408.2456 F 604.408-2525

ISSN 1703-3268 (English)ISSN 1712-5073 (French)

CONTENTSINTROduCTION — 4

RECOmmENdEd STEPS FOR TRuSTEES — 7

SuRVEy PaRTICIPaNTS’ RESPONSES — 8

aNayLSIS OF SuRVEy PROPOSaLS aNd ISSuES — 70Appointment of auditors — 70Election of directors — 71directors’ compensation — 75Executive compensation — 78Other corporate governance issues — 82Corporate social responsibility — 84

aPPENdIx — 85Who responded? — 85Survey results at a glance — 86Voting records of investment managers that did not participate — 88How proxy issues are selected for inclusion in the survey — 94How participating firms’ votes compare to meeting vote results by proposal — 95

IntroductionProxy voting is an important part of responsible investing. Many pension funds invest in shares of publicly traded companies, and those shares usually include the right to vote at companies’ shareholder meetings. Those voting rights are assets of the fund. Just as the fund’s other assets are managed, pension fund trustees and other fiduciaries have a duty to ensure that their funds’ voting rights are being exercised in the best interests of their beneficiaries.

In practice, this means that trustees need to oversee how their funds’ proxy ballots are being voted. However, evaluating the work of firms that vote proxy ballots for institutional investors can be difficult. The Canadian Key Proxy Vote Survey allows trustees to compare the proxy voting practices and records of investment managers and proxy voting services that vote proxy ballots for Canadian pension funds. The survey also compares the voting records of participating firms with SHaRE’s proxy votes.

Each year we survey investment managers and proxy-voting services that manage funds for Canadian pension plans and that decide how to vote the proxy ballots attached to their clients’ shareholdings on a set of key proposals from the previous year (see Table 1). It also provides information about how firms manage proxy voting for their clients. The survey results provide pension fund trustees and other investors with unique insights into how these firms manage proxy voting and vote proxy ballots. This year, the survey was sent to 60 investment managers and proxy voting services that vote the proxy ballots of Canadian companies on behalf of their Canadian pension clients. Thirty-eight of those firms completed the survey, resulting in a participation rate of 63%.

Hillsdale Investment management is participating in the Canadian Key Proxy Vote Survey for the first time and we welcome its contribution to this year’s survey. Fourteen of the firms that took part in the 2014 survey have been participating in this survey for seven or more years. We appreciate the support they provide by being part of the survey.

The first section lists ways trustees can use the information in this survey to oversee how their proxy voting agents manage and make decisions about proxy voting. Section 2 contains the participating firms’ responses to the survey, including how each firm voted on the key proposals chosen for 2014 and how these votes compare to SHARE’s vote. Section 3 provides a detailed analysis of each proxy ballot proposal. The appendix provides information about who responded to the survey, the survey’s methods for selecting proxy ballot issues and aggregate information about the survey’s results.

Key Proxy Vote Survey2 0 1 4

4

Table 1: 2014 Proxy Vote Issues and SHARE’s Vote

Company Name Meeting Date ProposalSHARE’s

VoteAppointment of Auditors

Canadian Energy Services & Technology Corporation 19-Jun-2014 Appoint the auditors of the corporation for the ensuing year Withhold

Enbridge Inc. 07-may-2014 appoint PricewaterhouseCoopers LLP as auditors Withhold

Election of Directors

Alimentation Couche-Tard Inc. 25-Sep-2013 Adopt a majority voting policy for elections of directors (Shareholder proposal) For

Baytex Energy Corp. 15-May-2014 Elect a director: John a. Brussa Against

Canadian Imperial Bank Of Commerce 24-Apr-2014 Elect a director: L. Rahl Withhold

Enerplus Corporation 09-May-2014 Elect a director: Glen d. Roane Withhold

Imax Corporation 02-Jun-2014 Elect a director: Garth M. Girvan Withhold

Power Corporation Of Canada 15-May-2014 Elect a director: Laurent dassault Withhold

Quebecor Inc. 19-Jun-2014 Election of directors by all of the shareholders (Shareholder proposal) For

Transforce Inc. 24-Apr-2014 Elect a director: alain Bédard Withhold

Directors’ Compensation

B2Gold Corp. 13-Jun-2014 approve the RSu plan resolution relating to the amendment of the RSu plan Against

Capstone Mining Corp. 30-Apr-2014 Approve amendments to the company's share option and bonus share plan Against

Chartwell Retirement Residences 15-May-2014 Approve certain amendments to the long term incentive plan Against

Element Financial Corporation 26-Jun-2014 Authorize and re-approve the amended share option plan Against

Sherritt International Corporation 06-May-14 Eliminate special payments to directors (Shareholder proposal) For

(table continued)

Key Proxy Vote Survey Key Proxy Vote Survey2 0 1 4

5

Company Name Meeting Date ProposalSHARE’s

VoteExecutive Compensation

agnico Eagle mines Limited 02-May-2014 Advisory resolution accepting the company's approach to executive compensation Against

Blackberry Limited 19-Jun-2014 Accept the company's approach to executive compensation Against

Crescent Point Energy Corp. 09-May-2014 Advisory resolution accepting the company's approach to executive compensation Against

Goldcorp Inc. 01-May-2014 Advisory resolution accepting the company's approach to executive compensation Against

The North West Company Inc. 11-Jun-2014 Adopt a policy setting a normal retirement age of 65 years for executives (Shareholder proposal) For

Quebecor Inc. 19-Jun-2014 Advisory vote on executive compensation (Shareholder proposal) For

Talisman Energy Inc. 07-may-2014 Policy on executive equity awards in event of change in control (Shareholder proposal) For

Trican Well Service Ltd. 08-May-2014 Advisory resolution accepting the company's approach to executive compensation Against

Other Corporate Governance IssuesBankers Petroleum Ltd. 21-May-2014 Approve by-law no. 1 of the company AgainstCameco Corporation 28-May-2014 Resolved, that the amended and restated Bylaw no. 7 of Cameco

Corporation be and is confirmedAgainst

Transglobe Energy Corporation

10-Jun-2014 Approve by-law number 2 of the company relating to the advance notice of nomination of directors

Against

Corporate Social Responsibility

Alimentation Couche-Tard Inc. 25-Sep-2013 Report annually on the environmental and social performance of the corporation (Shareholder proposal) For


6

1 Recommended Steps For TrusteesThe Key Proxy Vote Survey Report is a tool to help pension fund trustees engage in conversation with their investment managers and proxy voting agents about how their funds’ proxy ballots are voted. With this in mind, we suggest that you review the participating firms’ responses (Section 2), and the description of SHaRE’s positions on the proxy issues in the survey (Section 3).

If your investment manager or proxy voting service participated in the survey, we encourage you to discuss their survey responses with them. The survey results do not provide information about why firms voted as they did on each issue. Those explanations are beyond the scope of the survey, but they are important nonetheless. We encourage trustees to talk to the firms listed here about the reasons for their votes on these ballot issues.

If your investment manager did not take part in the survey, the information in the report can be used as the basis for a conversation with your manager about how that firm handles proxy voting and how your funds’ proxy ballots were voted on the issues in the survey.

In addition to talking to investment managers about the issues addressed by the proxy voting survey, that the following steps will help trustees ensure that their oversight of their funds’ assets includes overseeing their funds’ proxy voting:

Learn how your funds’ proxy ballots are being voted. Who does the voting? does that voting agent use any guidelines? If so, which ones? do the guidelines address environmental and social issues as well as corporate governance?

When your fund selects an investment manager or proxy voting service, include the firm’s proxy voting record in the selection criteria.

Adopt proxy voting guidelines that match the scope of your plan’s investments. For example, if the plan has global investments, choose proxy voting guidelines that include global issues.

In your plan’s statement of investment policies and procedures (SIPP), set out the roles and responsibilities for voting your plan’s proxies. Trustees should retain the discretion to direct proxy voting if they choose to do so. The SIPP should make reference to the plan’s proxy voting guidelines.

Instruct your investment managers, proxy voting services, or other voting agents to use your plan’s proxy voting guidelines.

Monitor how your plan’s proxy ballots are being voted to ensure they are being voted according to the guidelines. Ask your fund manager or proxy voting service for regular reports. Review the proxy voting reports and discuss with them any questions or concerns you have.


7

2 Survey Participants’ ResponsesThe survey responses for each firm that took part in the survey are listed in this section. The firms are listed in alphabetical order. The following information is reported for each participating firm:

1. How firms manage proxy voting: the first part of the survey asks participating firms about how they manage proxy voting, including how they report to clients on proxy voting, and whether or not they disclose their proxy voting guidelines and their proxy voting records.

2. How firms voted on key proxy ballot issues: twenty-seven key proposals were selected for the 2014 survey from the proxy ballots of Canadian companies that held shareholders’ meetings between July 1, 2013 and June 30, 2014. More information on how these proposals were chosen can be found in the section “How Proxy Issues Are Selected” in the Appendix. SHARE’s analysis of each proposal and the issue each proposal raises are in Section 3, “Analysis of Survey Issues”.


8

AllianceBernstein Institutional Investments

Total institutional assets under management: $480 billion

Proxy Voting Management Who is responsible for proxy voting? In-house committee, investment managers, individual in firm

Voting Disclosure does this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes Public Voting Record

Proxy Voting Guidelines Have proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? yesGuidelines

Table 1: allianceBernstein Insititutional Investments Votes Same as SHaRE’s Vote? yes= No=r

Corporation Proposal Vote

Same as SHARE’s

vote?Appointment of AuditorsEnbridge Inc. appoint PricewaterhouseCoopers LLP as auditors For r

Election of DirectorsAlimentation Couche-Tard Inc. Adopt a majority voting policy for elections of directors (Shareholder

proposal) For

Baytex Energy Corp. Elect a director: John a. Brussa For r

Canadian Imperial Bank of Commerce

Elect a director: L. Rahl For r

Enerplus Corporation Elect a director: Glen d. Roane For r

Power Corporation of Canada Elect a director: Laurent dassault Against/Withheld

Quebecor Inc. Election of directors by all of the shareholders (Shareholder proposal) For

Transforce Inc. Elect a director: alain Bédard For r

(table continued)


9

http://vds.issproxy.com

https://www.alliancebernstein.com/abcom/Our_Firm/Content/CGDocs/ABProxyVotingPolicy.pdf?uuid=5c20e6fc-9b41-11df-9b45-b437a98707f0


Same as SHARE’s

vote?Directors’ CompensationB2Gold Corp. approve the RSu plan resolution relating to the amendment of the

RSu plan For r

Capstone Mining Corp. Approve amendments to the company's share option and bonus share plan For r

Chartwell Retirement Residences

Approve certain amendments to the long term incentive plan. Against/Withheld

Sherritt International Corporation

Eliminate special payments to directors (Shareholder proposal) For

Executive Compensationagnico-Eagle mines Limited Advisory resolution accepting the company's approach to executive

compensationFor r

Blackberry Limited Accept the company's approach to executive compensation Against/Withheld

Crescent Point Energy Corp. Advisory resolution accepting the company's approach to executive compensation

Against/Withheld

Goldcorp Inc. Advisory resolution accepting the company's approach to executive compensation For r

North West Company Inc. (The)

Adopt a policy setting a normal retirement age of 65 years for executives (Shareholder proposal)

Against/Withheld

r

Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal) For

Talisman Energy Inc. Policy on executive equity awards in event of change in control (Shareholder proposal)

Against/Withheld r

Other Corporate Governance IssuesBankers Petroleum Ltd. Approve by-law no. 1 of the company Against/

WithheldCameco Corporation Resolved, that the amended and restated Bylaw no. 7 of Cameco

Corporation be and is confirmedFor r

Corporate Social ResponsibilityAlimentation Couche-Tard Inc. Report annually on the environmental and social performance of the

corporation (Shareholder proposal) For


10

Amundi Asset Management Canada

Total institutional assets under management: $1161.738 billion (€829.4 billion)

Proxy Voting Management Who is responsible for proxy voting? In-house committee

Voting Disclosure does this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? No


Table 2: Amundi Asset Management Canada Votes Same as SHaRE’s Vote? yes= No=r

Corporation Proposal VoteSame as

SHARE’s vote?Appointment of AuditorsEnbridge Inc. appoint PricewaterhouseCoopers LLP as auditors For r

Election of DirectorsAlimentation Couche-Tard Inc. Adopt a majority voting policy for elections of directors

(Shareholder proposal) For




Directors’ CompensationB2Gold Corp. approve the RSu plan resolution relating to the amendment of

the RSu planAgainst/Withheld

(table continued)


11

http://le-groupe.amundi.com/Navigation/Un-acteur-engage/Developper-une-finance-responsable


SHARE’s vote?Executive Compensationagnico-Eagle mines Limited Advisory resolution accepting the company's approach to

executive compensationAgainst/Withheld



Against/Withheld

Goldcorp Inc. Advisory resolution accepting the company's approach to executive compensation

Against/Withheld

Talisman Energy Inc. Policy on executive equity awards in event of change in control (Shareholder proposal) For

Other Corporate Governance IssuesCameco Corporation Resolved, that the amended and restated Bylaw no. 7 of

Cameco Corporation be and is confirmed For r

Corporate Social ResponsibilityAlimentation Couche-Tard Inc. Report annually on the environmental and social performance

of the corporation (Shareholder proposal) For


12

Beutel, Goodman & Company Ltd.

Total institutional assets under management: $41.6 billion

Proxy Voting ManagementWho is responsible for proxy voting? Investment managers

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly?yes, for Beutel Goodman mutual fundsPublic Voting Record

Proxy Voting Guidelines Have proxy voting guidelines? Nodiscloses proxy voting guidelines publicly? did not respond

Table 3: Beutel, Goodman & Company Ltd. Votes Same as SHaRE’s Vote? yes= No=r


SHARE’s vote?Election of DirectorsBaytex Energy Corp. Elect a director: John a. Brussa For r



Quebecor Inc. Election of directors by all of the shareholders (Shareholder proposal)

For

Executive CompensationQuebecor Inc. Advisory vote on executive compensation (Shareholder

proposal) For

Other Corporate Governance IssuesCameco Corporation Resolved, that the amended and restated Bylaw no. 7 of

Cameco Corporation be and is confirmed For r


13

http://vds.issproxy.com

Blackrock Inc.

Total institutional assets under management: $5153.25 billion (uS$4593 billion)

Proxy Voting ManagementWho is Responsible for Proxy Voting? In-house committee, Investment managers,Other: Corporate governance & responsible investment team

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for iShares CanadaPublic Voting Record


Table 4: Blackrock Inc. Votes Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s

vote?Appointment of AuditorsCanadian Energy Services & Technology Corporation

Appoint the auditors of the corporation for the ensuing year For r

Enbridge Inc. appoint PricewaterhouseCoopers LLP as auditors. For r


proposal)For




Imax Corporation Elect a director: Garth M. Girvan Against/Withheld



For


(table continued)


14

http://www.blackrock.com/corporate/en-us/about-us/responsible-investment/responsible-investment-reports

http://www.blackrock.com/corporate/en-us/about-us/responsible-investment/responsible-investment-reports


Same as SHARE’s

vote?Directors’ CompensationCapstone Mining Corp. Approve amendments to the company's share option and bonus

share planAgainst/Withheld



Element Financial Corporation Authorize and re-approve the amended share option plan For r




compensationFor r


Against/Withheld


For r



For



Trican Well Service Ltd. Advisory resolution accepting the company's approach to executive compensation

For r

Other Corporate Governance IssuesCameco Corporation Resolved, that the amended and restated Bylaw no. 7 of Cameco

Corporation be and is confirmedAgainst/Withheld


Approve by-law number 2 of the company relating to the advance notice of nomination of directors

Against/Withheld


corporation (Shareholder proposal)For


15

CIBC Asset Management Inc.


Proxy Voting ManagementWho is responsible for proxy voting? Investment managers, proxy-voting service, Chief Investment Officer

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for mutual fundsPublic Voting Record

Proxy Voting Guidelines Have proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? No

Table 5: CIBC asset management Inc. Votes Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For








(table continued)


16

http://www.cibc.com/ca/mutual-funds/articles/proxy-voting.html, www.renaissance.ca/en/reporting-governance


Same as SHARE’s









compensation For r


Against/Withheld



Adopt a policy setting a normal retirement age of 65 years for executives (Shareholder proposal) For

Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal) ForTalisman Energy Inc. Policy on executive equity awards in event of change in control


Trican Well Service Ltd. Advisory resolution accepting the company's approach to executive compensation For r





Against/Withheld




17

Connor Clark & Lunn Financial Group


Proxy Voting ManagementWho is responsible for proxy voting? Individual in firm

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? No

Proxy Voting Guidelines Have proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? NoConnor Clark and Lunn declined to provide their proxy voting record

Fidelity Investments Canada Limited


Proxy Voting ManagementWho is responsible for proxy voting? In-house committee, internal proxy voting group

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for mutual fundsPublic Voting Record



18

https://www.fidelity.ca/cs/Satellite/en/public/products/regulatory_documents/proxy_voting

https://www.fidelity.ca/cs/Satellite/en/public/products/regulatory_documents/proxy_voting/guidelines

Table 6: Fidelity Investments Canada Limited Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal)For






For


Directors’ CompensationChartwell Retirement Residences

Approve certain amendments to the long term incentive plan. For r


compensation For r


Crescent Point Energy Corp. Advisory resolution accepting the company's approach to executive compensation For r


Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal) Against/Withheld r


Against/Withheld r


(table continued)


19


Same as SHARE’s

vote?Other Corporate Governance IssuesCameco Corporation Resolved, that the amended and restated Bylaw no. 7 of Cameco

Corporation be and is confirmed For r


Approve by-law number 2 of the company relating to the advance notice of nomination of directors For r


corporation (Shareholder proposal)Against/Withheld r

Fiera Capital Inc.

Total institutional assets under management: $ 82.1 billion

Proxy Voting ManagementWho is responsible for proxy voting? Sector managers

Voting Disclosuredoes this firm issue proxy voting reports to clients? at client’s requestdiscloses proxy voting record publicly? yes, for mutual fundsPublic Voting record



20

http://www.fieracapital.com/en/investor_solutions/mutualfunds/mutual_funds/

Table 7: Fiera Capital Inc. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal)For









Directors’ CompensationB2Gold Corp. approve the RSu plan resolution relating to the amendment of the

RSu planAgainst/Withheld

Capstone Mining Corp. Approve amendments to the company's share option and bonus share plan

Against/Withheld




(table continued)


21


Same as SHARE’s

vote?Executive Compensationagnico-Eagle mines Limited Advisory resolution accepting the company's approach to executive

compensation For r



Against/Withheld












Against/Withheld




22

Foyston, Gordon & Payne Inc.




Proxy Voting GuidelinesHave proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? No

Table 8: Foyston, Gordon & Payne Inc. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s


Election of DirectorsCanadian Imperial Bank of Commerce


Power Corporation of Canada Elect a director: Laurent dassault For r

Directors’ CompensationSherritt International Corporation

Eliminate special payments to directors (Shareholder proposal) Against/Withheld r

Executive CompensationNorth West Company Inc. (The)


Against/Withheld r



23

GE Asset Management Incorporated


Proxy Voting ManagementWho is responsible for proxy voting? In-house committee, Investment managers, Individual in firm



Table 9: GE Asset Management Incorporated Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s


Election of DirectorsAlimentation Couche-Tard Inc. Adopt a majority voting policy for elections of directors






RSu plan For r


Executive CompensationGoldcorp Inc. Advisory resolution accepting the company's approach to executive

compensation For r






24

Genus Capital Management Inc. (Fund A)


Proxy Voting ManagementWho is responsible for proxy voting? Proxy-voting service

Voting Disclosuredoes this firm issue proxy voting reports to clients? Nodiscloses proxy voting record publicly? No


Table 10: Genus Capital Management Inc. (Fund A) Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



proposal) For






RSu plan For r


(table continued)


25


Same as SHARE’s

vote?Executive CompensationCrescent Point Energy Corp. Advisory resolution accepting the company's approach to executive

compensation For r


Against/Withheld



Against/Withheld r



Other Corporate Governance IssuesBankers Petroleum Ltd. Approve by-law no. 1 of the company For r



Genus Capital Management Inc. (Fund B)



Voting Disclosuredoes this firm issue proxy voting reports to clients? Nodiscloses proxy voting record publicly? No



26

Table 11: Genus Capital management Inc. (Fund B) Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



proposal) For


Elect a director: L. Rahl Against/Withheld




RSu plan For r


Executive CompensationCrescent Point Energy Corp. Advisory resolution accepting the company's approach to executive

compensation For r


Against/Withheld



Against/Withheld r







27

Glass Lewis & Co. LLC

Total institutional assets under management: Not applicable to proxy voting services

Proxy Voting ManagementWho is responsible for proxy voting? Other, they are a proxy voting service


Proxy Voting GuidelinesHave proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? yesGuidelines

Table 12: Glass Lewis & Co. LLC Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s


Appoint the auditors of the corporation for the ensuing year Against/Withheld



proposal) For




Enerplus Corporation Elect a director: Glen d. Roane Against/Withheld




Transforce Inc. Elect a director: alain Bédard Against/Withheld

(table continued)


28

http://www.glasslewis.com/resource/guidelines/


Same as SHARE’s


RSu plan For r




Element Financial Corporation Authorize and re-approve the amended share option plan Against/Withheld




compensationAgainst/Withheld




Against/Withheld



Against/Withheld r




Against/Withheld


Cameco Corporation Resolved, that the amended and restated Bylaw no. 7 of Cameco Corporation be and is confirmed For r






29

Greystone Managed Investments Inc.


Proxy Voting ManagementWho is responsible for proxy voting? Managers who chose the stock for inclusion in the portfolio



Table 13: Greystone Managed Investments Inc. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



proposal) For




Directors’ CompensationElement Financial Corporation Authorize and re-approve the amended share option plan For r




Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal) For(table continued)


30


Same as SHARE’s

vote?Other Corporate Governance IssuesBankers Petroleum Ltd. Approve by-law no. 1 of the company Against/

WithheldCorporate Social ResponsibilityAlimentation Couche-Tard Inc. Report annually on the environmental and social performance of the


Groupe Investissement Responsable


Proxy Voting ManagementWho is responsible for proxy voting? In-house committee


Proxy Voting GuidelinesHave proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? No

Table 14: Groupe Investissement Responsible Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



Enbridge Inc. appoint PricewaterhouseCoopers LLP as auditors. Against/Withheld

(table continued)


31


Same as SHARE’s

vote?Election of DirectorsAlimentation Couche-Tard Inc. Adopt a majority voting policy for elections of directors (Shareholder

proposal) For

Baytex Energy Corp. Elect a director: John a. Brussa Against/Withheld











Against/Withheld






(table continued)


32


Same as SHARE’s





Against/Withheld


Against/Withheld






Against/Withheld









33

Gryphon Investment Counsel Inc.

Total institutional assets under management: $904.5 million


Voting DisclosureDoes this firm issue proxy voting reports to clients? YesDiscloses proxy voting record publicly? No

Proxy Voting Guidelines Have proxy voting guidelines? YesDiscloses proxy voting guidelines publicly? No

Table 15: Gryphon Investment Counsel Inc. Voting Record Same as SHARE’s Vote? Yes= No=r


Same as SHARE’s


proposal) For




Executive CompensationQuebecor Inc. Advisory vote on executive compensation (Shareholder proposal) Against/

Withheld r






34

Hexavest



Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdisloses proxy voting record publicly? No


Table 16: Hexavest Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s


proposal) For




WithheldTransglobe Energy Corporation





35

http://www.hexavest.com

Highstreet Asset Management Inc.





Table 17: Highstreet asset management Inc. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For







(table continued)


36


Same as SHARE’s


share plan For r


compensation For r

Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal) ForOther Corporate Governance IssuesBankers Petroleum Ltd. Approve by-law no. 1 of the company For r




37

Hillsdale Investment Management Inc. (Hillsdale is participating in the survey for the first time)





Table 18: Hillside Investment Management Inc. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For






(table continued)


38


Same as SHARE’s


compensation For r



Against/Withheld









39

Invesco Canada Ltd - PowerShares FundsTotal institutional assets under management: Not available


Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for retail funds


Table 19: Invesco Canada Ltd – PowerShares Funds Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



proposal) For







Directors’ CompensationSherritt International Corporation


Executive Compensation(table continued)


40


Same as SHARE’s

vote?agnico-Eagle mines Limited Advisory resolution accepting the company's approach to executive





Against/Withheld


(Shareholder proposal)Against/Withheld r






41

Invesco Canada Ltd (Toronto-managed funds)Total institutional assets under management: Not available


Voting DisclosureDoes this firm issue proxy voting reports to clients? YesDiscloses proxy voting record publicly? Yes, for retail fundsPublic Voting Record

Proxy Voting Guidelines Have proxy voting guidelines? YesDiscloses proxy voting guidelines publicly? No

Table 20: Invesco Canada Ltd (Toronto-managed funds) Voting Record Same as SHARE’s Vote? Yes= No=r


Same as SHARE’s




proposal) For

Enerplus Corporation Elect a director: Glen D. Roane For r

Power Corporation of Canada Elect a director: Laurent Dassault For r


Transforce Inc. Elect a director: Alain Bédard For r

Executive CompensationAgnico-Eagle Mines Limited Advisory resolution accepting the company's approach to executive

compensation For r



(Shareholder proposal)Against/Withheld r




42

http://www.invesco.ca

Invesco Canada Ltd (US-managed funds)Total institutional assets under management: Not available


Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for retail fundsPublic Voting Record


Table 21: Invesco Canada Ltd (uS-managed Funds) Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s


proposal) For





Other Corporate Governance IssuesTransglobe Energy Corporation


Against/Withheld




43

http://www.invesco.ca

ISS Canada - Proxy Advisory Services


Proxy Voting ManagementWho is responsible for proxy voting? They are a proxy advisory service



Table 22: ISS Canada – Proxy advisory Services Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For









(table continued)


44

http://www.issgovernance.com/policy-gateway


Same as SHARE’s




Against/Withheld







compensation For r



Against/Withheld












Against/Withheld




45

ISS Canada - Social Advisory Services





Table 23: ISS Canada – Social advisory Services Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For









(table continued)


46



Same as SHARE’s




Against/Withheld







compensation For r



Against/Withheld












Against/Withheld




47

ISS Canada -Taft Hartley Advisory Services





Table 24: ISS Canada – Taft Hartley advisory Services Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For









(table continued)


48



Same as SHARE’s


RSu plan For r








compensation For r



Against/Withheld












Against/Withheld




49

J. Zechner Associates Inc.





Table 25: Zechner Associates Inc. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s

vote?Election of DirectorsBaytex Energy Corp. Elect a director: John a. Brussa For r





RSu plan For r


Executive CompensationBlackberry Limited Accept the company's approach to executive compensation For r



For r


50

Leith Wheeler Investment Counsel Ltd.



Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yesPublic Voting Record


Table 26: Leith Wheeler Investment Counsel Ltd. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s

vote?Election of DirectorsCanadian Imperial Bank of Commerce


Directors’ CompensationElement Financial Corporation Authorize and re-approve the amended share option plan Against/

WithheldCapstone Mining Corp. Approve amendments to the company's share option and bonus

share plan For r




51

http://www.leithwheeler.com

Lincluden Management Ltd.


Proxy Voting ManagementWho is responsible for proxy voting? Investment managers, Individual in firm



Table 27: Lincluden management Ltd. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s

vote?Election of DirectorsCanadian Imperial Bank of Commerce



Directors’ CompensationCapstone Mining Corp. Approve amendments to the company's share option and bonus






Against/Withheld r


Against/Withheld r


Against/Withheld




52

Manulife Asset Management


Proxy Voting ManagementWho is responsible for proxy voting? In-house proxy voting department



Table 28: Manulife Asset Management Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For









(table continued)


53


Same as SHARE’s




Against/Withheld







compensation For r

Blackberry Limited Accept the company's approach to executive compensation For r


Against/Withheld












Against/Withheld




54

Marco Consulting Group


Proxy Voting ManagementWho is responsible for proxy voting? In-house committee, Individual in firm



Table 29: Marco Consulting Group Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



Enbridge Inc. appoint PricewaterhouseCoopers LLP as auditors. Against/Withheld


proposal) For








(table continued)


55


Same as SHARE’s




Against/Withheld







Against/Withheld


Against/Withheld










56

Mawer Investment Management



Voting Disclosuredoes this firm issue proxy voting reports to clients? yes Public Voting Recorddiscloses proxy voting record publicly? yes, for mutual funds


Table 30: Mawer Investment Management Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s




Election of DirectorsPower Corporation of Canada Elect a director: Laurent dassault Against/

WithheldDirectors’ CompensationElement Financial Corporation Authorize and re-approve the amended share option plan Against/

Withheld


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mawer.com/mutual-funds/how-to-buy/fund-documents-forms

Proxy Vote Plus




Proxy Voting Guidelines Have proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? yesNo uRL was provided and the guidelines are not currently on the Proxy Vote Plus website.

Table 31: Proxy Vote Plus Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For




Imax Corporation Elect a director: Garth M. Girvan For r




(table continued)


58


Same as SHARE’s

vote?Directors’ CompensationSherritt International Corporation





Against/Withheld




Against/Withheld






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RBC Global Asset Management


Proxy Voting ManagementWho is responsible for proxy voting? In-house committee, Individual in firm

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for prospectused funds Public Voting Record


Table 32: RBC Global asset management Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For









(table continued)


60

http://funds.rbcgam.com/investor-information/proxy-voting/rbc-funds-records.html

http://funds.rbcgam.com/investor-information/proxy-voting/index.html


Same as SHARE’s




Against/Withheld







compensation For r



Against/Withheld












Against/Withheld




61

Russell Investments Canada Ltd.



Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yesNo uRL provided


Table 33: Russell Investments Canada Ltd. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s





proposal) For








(table continued)


62


Same as SHARE’s


RSu plan For r











Against/Withheld

Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal) ForTrican Well Service Ltd. Advisory resolution accepting the company's approach to executive



Cameco Corporation Resolved, that the amended and restated Bylaw no. 7 of Cameco Corporation be and is confirmed For r






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Seamark Asset Management Ltd.Total institutional assets under management: $247 million

Proxy Voting ManagementWho is responsible for proxy voting? Analysts



Table 34: Seamark asset management Ltd. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s

vote?Appointment of AuditorsEnbridge Inc. appoint PricewaterhouseCoopers LLP as auditors Against/

WithheldElection of DirectorsAlimentation Couche-Tard Inc. Adopt a majority voting policy for elections of directors (Shareholder

proposal) For




compensation For r







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Sionna Investment ManagersTotal institutional assets under management: $ 2.847 billion

Proxy Voting ManagementWho is responsible for proxy voting? Investment managers, Proxy-voting service

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yes, for some funds Public Voting Record

Proxy Voting GuidelinesHave proxy voting guidelines? yesdiscloses proxy voting guidelines publicly? yes Guidelines

Table 35: Sionna Investment Managers Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s


Election of DirectorsCanadian Imperial Bank of Commerce








Against/Withheld



Against/Withheld




65

http://bridgehousecanada.com/legal-and-regulatory/proxy-voting-records-table/

http://www.sionna.ca/governance/proxy-voting-guidelines/

State Street Global Advisors Ltd.


Proxy Voting ManagementWho is responsible for proxy voting? Governance Specialist team reporting to the Investment Committee, Proxy Review subcommittee of the Investment Committee

Voting Disclosuredoes this firm issue proxy voting reports to clients? yesdiscloses proxy voting record publicly? yesPublic Voting Record


Table 36: State Street Global advisors Ltd. Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s

vote?Appointment of AuditorsCanadian Energy Services and Technology Corporation




proposal) For









(table continued)


66

http://www.ssga.com

http://www.ssga.com


Same as SHARE’s


RSu plan For r








compensation For r



Against/Withheld




Against/Withheld r









Against/Withheld




67

Toron - AMI International Asset Management





Table 37: Toron – amI International asset management Voting Record Same as SHaRE’s Vote? yes= No=r


Same as SHARE’s



proposal) For








Directors’ CompensationElement Financial Corporation Authorize and re-approve the amended share option plan For r

(table continued)


68


Same as SHARE’s

vote?Executive CompensationBlackberry Limited Accept the company's approach to executive compensation Against/

WithheldCrescent Point Energy Corp. Advisory resolution accepting the company's approach to executive











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3 analysis Of Survey Proposals and Issues

Twenty-seven proposals were included in the 2014 Key Proxy Vote Survey. This section describes those proposals and explains why each is important to shareholders. The result of the shareholder vote as reported by the company and an explanation of SHARE’s position on the issue are provided for each proposal.

Shareholders of Canadian companies cannot vote against directors or auditors; they can only vote “for” or “withhold”. Many companies treat “withhold” votes as votes against a director or auditor, rather than being equivalent to an abstention. However we have kept the term “withhold” to describe these votes because that is more accurate than calling them votes against directors or auditors.

APPOINTMENT OF AUDITORSCanadian Energy Services & Technology CorporationProposal: Appoint the auditors of the corporation for the ensuing yearSHARE’s Vote: WithholdVote Result: No numeric results were reported

The Issue: Auditors’ Independence: Audit FeesSHaRE’s position: Companies sometimes hire their external audit firm to provide them with tax advice, consulting or other services. SHARE believes that hiring the outside auditor to perform work other than the annual audit has the potential to compromise the independence of those auditors. We strongly prefer auditors that have not performed services other than the annual audit. SHARE votes against auditors if more than one-third of the fees paid to the auditors in the previous year were for services other than the annual audit.

Why SHARE Voted To WithholdOnly 25% of the fees that Canadian Energy Services paid to its auditor were for the annual audit.


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Enbridge Inc.Proposal: appoint PricewaterhouseCoopers LLP as auditorsSHARE’s Vote: WithholdVote Result: 1.57% Withheld

The Issue: Auditors’ Independence: Tenure And RotationSHaRE’s position: Companies that use the same accounting firm to conduct their audits for long periods of time run the risk of developing a close relationship that can compromise the independence of their annual audit. SHARE prefers that companies rotate their audit firms every six to ten years. at a minimum, companies should change their audit partner every seven years, regardless of whether or not they are required to do so by law. However, shareholders rarely have information about the tenure of a company’s audit partner. SHARE votes against auditors if the company has kept the same accounting firm as its auditor for more than ten years, unless the company indicates in its proxy materials that the audit partner has changed in the past 7 years.

Why SHARE Voted to Withhold:PricewaterhouseCoopers and its predecessors have been Enbridge’s auditor since 1992, and auditor of a subsidiary of Enbridge since 1949. A tenure of this duration has the potential to establish close relationships between the company and its audit firm that may compromise the independence of the annual audit. Enbridge did not disclose how long its current audit partner has served in that position. SHARE withheld its vote for the auditor for this reason.

ELECTION OF DIRECTORSBaytex Energy Corp.Proposal: Elect a director: John a. BrussaSHARE’s Vote: WithholdVote Result: 26.35% Withheld

The Issue: Board IndependenceSHaRE’s position: directors have a legal obligation to act in the best interests of the company. However, it is difficult for anyone to avoid being influenced by conflicts of interest. This is why boards of directors must be independent of the company’s management. directors are not in a good position to hold management accountable if they have a relationship to the company other than as shareholders and directors. For this reason, two-thirds of the board of directors should be independent.If less than two-thirds of directors are independent, SHARE will vote to withhold for the directors who are not independent. The Canadian Coalition for Good Governance has also adopted two-thirds as the minimum proportion of independent directors a board should have.

Why SHARE Voted to Withhold:Four of the eight directors on Baytex’s board are not independent, which is short of the two-thirds that the board should have. mr. Brussa is not an independent director because he works for a law firm that provides legal services to Baytex. SHaRE voted “withhold” for him for this reason.


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Power Corporation of CanadaProposal: Elect a director: Laurent dassaultSHARE’s Vote: WithholdVote Result: 18.65% Withheld (45.9% of votes not held by controlling shareholders were voted “Withhold”)Power Corporation has a dual class share structure that allows the desmarais family to control just over 59% of the company’s voting rights.

The Issue: Directors’ AttendanceSHaRE’s position: Candidates for director must be able to devote a sufficient amount of time and energy to the board in order to oversee the corporation well. Attendance at board meetings is not the sole determinant of a director’s performance, but poor attendance makes it difficult for a director to fulfill his or her responsibilities to the board. Since boards customarily schedule their routine meetings and committee meetings at least a year in advance, anyone who agrees to be nominated for director should be prepared to attend all board meetings.

The Canadian Coalition for Good Governance says that directors should attend all meetings of the board and board committees on which they serve. SHARE votes against directors who have missed more than 25 percent of the board’s meetings and committee meetings, unless extenuating circumstances are set out in the proxy materials.

Why SHARE Voted to Withhold:mr. dassault attended only 4 of the 9 meetings of the board and committees on which he served in 2013. This makes it difficult for him to fulfill his or her responsibilities as a director.

Enerplus CorporationProposal: Elect a director: Glen d. RoaneSHARE’s Vote: WithholdVote Result: 9.45% Withheld

The Issue: Directors’ Ability To Serve EffectivelySHaRE’s position: directors’ ability to serve effectively may be affected by their other commitments, including the number of boards on which they serve. The Canadian Coalition for Good Governance says that directors who hold a full-time executive position should hold at most two outside public company directorships, and that directors who are not employed full time should generally hold no more than four additional outside public company directorships.

SHaRE does not vote against directors who sit on more than a fixed number of boards; the number of boards a director can serve on effectively depends on that individual’s abilities and commitments. However, SHARE will withhold votes for directors who appear to have too many existing commitments to fulfill their duties as director. Indications that a director has too many commitments could include serving on more than five other boards and/or employment as a senior officer at another company.

Why SHARE Voted to Withhold:Mr. Roane sits on the board of 13 public companies. Although we usually assume that directors are capable of deciding for themselves how many boards they can serve on effectively, this is an exceptionally large number of board memberships. No one can serve effectively on this many boards of directors.


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Transforce Inc.Proposal: Elect a director: alain BédardSHARE’s Vote: WithholdVote Result: mr. Bédard was elected by a show of hands at the annual meeting. The results of the shareholders’ vote were not reported.

The Issue: Independent Chair Of The BoardSHARE’s position: The chair of the board of directors must be an independent director in order to guide the board in its responsibility for overseeing management’s performance. This is a basic tenet of good corporate governance. SHARE will vote against directors who are not independent if they also chair the board, or if they would become chair of the board upon election.

Why SHARE Voted to Withholdmr. Bédard is both CEO and chair of the board of directors. The chair of the board cannot be a member of management and still guide the board in its responsibility for overseeing management’s performance without a conflict of interest.

Canadian Imperial Bank of CommerceProposal: Elect a director: L. RahlSHARE’s Vote: WithholdVote Result: 14.91% Withheld

The Issue: Directors’ Performance And QualificationsSHARE’s position: SHARE decides how to vote on directors case by case, taking into consideration our proxy voting guidelines and the long-term performance of the corporation and the board. SHARE will vote against director nominees who have a conflict of interest, or who have failed in their duty of care as a director, even if those failures took place at another company. This could include a conviction for financial, corporate, or securities crime—including insider trading — or past incidents of serious misconduct, regulatory sanctions, or ethical violations relating to their corporate responsibilities.

Why SHARE Voted Withholdms. Rahl was chair of the audit committee of the uS Federal National mortgage association, commonly known as Fannie Mae, between 2004 and 2008. Fannie Mae was found to have had serious accounting irregularities in its financial statements twice during this period. In 2004, the firm’s top executives were charged with manipulating the financial statements in order to maximize their own bonuses. Fannie mae’s executives were found to have misrepresented Fannie mae’s financial position again in 2008 by minimizing the firm’s exposure to the subprime mortgage market. Fannie mae collapsed in 2008 and was taken over by the uS government.

By not recognizing the problems in Fannie mae’s financial condition or reports, ms. Rahl and other Fannie mae directors – especially those on the audit committee – failed in their duty of care to the firm’s shareholders. SHaRE found that this failure was serious enough to consider ms. Rahl unqualified to serve as a corporate director and voted “withhold”.


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IMAX CorporationProposal: Elect a director: Garth M. GirvanSHARE’s Vote: WithholdVote Result: 45.69% Withheld

The Issue: Independent Board CommitteesSHARE’s position: All boards of directors should have audit, compensation, and nominating committees made up entirely of independent directors. These committees are essential in overseeing a company. They are also in the best position to prevent corporate malfeasance and protect the value of the company.

Why SHARE Voted to Withholdmr. Girvan is not an independent director because he is a partner with mcCarthy Tétrault LLP, which does legal work for Imax Corporation. However, he serves on the nominating committee, which should be made up entirely of independent directors. SHARE votes against directors who are not independent and sit on the nominating committee.

Alimentation Couche-Tard Inc.Proposal: Adopt a majority voting policy for elections of directors (Shareholder Proposal)SHARE’s Vote: ForVote Result: 21.69% For (73.9% of minority shareholders voted For)alimentation Couche-Tard has a dual class share structure that gives the controlling shareholders 77% of the voting rights.

The Issue: Majority Elections For DirectorSHARE’s position: Elections for directors at many Canadian companies are “plurality” elections. In practice, this means that a director needs only one vote in his or her favour to be elected. Majority elections for directors require a director to win a majority of the votes cast in order to be elected to the board. SHARE supports majority elections of directors because they allow shareholders to actually elect directors, rather than simply confirming the board’s nominees.

Why SHARE Voted ForMajority elections make directors more accountable to shareholders, even at controlled companies such as this one. It is worth noting that 68% of the holders of subordinate voting shares voted for this proposal last year.


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Quebecor Inc. Proposal: Election of directors by all of the shareholdersSHARE’s Vote: ForVote Result: 99.82% ForQuebecor has a dual class share structure that allows Karl Péladeau to control 73% of the voting rights. mr. Péladeau voted for this proposal.

The Issue: Election of directorsSHARE’s position: The board of directors is responsible for overseeing the management of the company on behalf of the company’s shareholders. The board is accountable to the shareholders as owners of the corporation. Thus, it should be elected by the shareholders.

Why SHARE Voted ForIn the past, Quebecor only counted the votes of shareholders who were physically present at the annual meeting in the election of its directors. The votes of shareholders who submitted proxy ballots, which is most of the shareholders, were not counted. This proposal asked Quebecor to allow all shareholders, not just those physically present at the meeting, to elect the directors. This is an important principle of shareholder democracy. Quebecor has agreed to adopt this proposal and recommended voting for it.

DIRECTORS’ COMPENSATIONB2Gold Corp.Proposal: approve the RSu plan resolution relating to the amendment of the RSu planSHARE’s Vote: AgainstVote Result: 39.58% Against

The Issue: Inclusion of directors in executive compensation plans and incentive compensation for directors.SHaRE’s position: directors should have compensation plans that are separate from executive compensation plans. Including directors in a management compensation plan can undermine the board’s independence, because it tends to align directors’ interests with the interests of the executives whose performance the board is supposed to oversee. SHARE votes against executive compensation plans that include non-executive directors.

The same reasoning applies to incentive compensation, which is not an appropriate form of compensation for directors. Incentive compensation may link the directors’ interests to those of executives, who also receive incentive pay.

Why SHARE Voted Against B2Gold’s RSu plan is a share-based incentive bonus plan for executives that also includes directors. This is not a good compensation practice. Including directors in a management compensation plan can undermine the board’s independence, because it tends to align directors’ interests with the interests of the executives whose performance the board is supposed to oversee.


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Capstone Mining Corp.Proposal: Approve Amendments to the company’s share option and bonus share planSHARE’s Vote: AgainstVote Result: 35.84% Against

Element Financial CorporationProposal: Authorize and re-approve the amended share option planSHARE’s Vote: AgainstVote Result: 32.57% against

The Issue: Stock Options As Director CompensationSHaRE’s position: directors should not be granted stock options. Stock options are profitable when the exercise price rises above the grant price, which tends to focus option holders’ attention on short-term fluctuations in share price. directors need to focus instead on the long-term interests of shareholders. SHaRE votes against stock option plans that are for or include non-executive directors.

Why SHARE Voted AgainstBoth of these companies had stock options plans for executives that also included directors. as we noted earlier, including directors in a management compensation plan can undermine the board’s independence, because it tends to align directors’ interests with the interests of the executives whose performance the board is supposed to oversee. In addition, stock options reward their recipients for increases in share price. Thus, they give directors an incentive to foster relatively short term gains in share price, even when this does not result in improved long-term shareholder value. SHARE voted against both of these stock option plans for this reason.

Chartwell Retirement ResidencesProposal: Approve certain amendments to the long term incentive planSHARE’s Vote: AgainstVote Result: 48.33% Against

The Issue: Discounted Stock OptionsSHARE’s position: When stock options are used as a form of compensation, they should be issued at or above the market price of the company’s shares at the time of issuance. Options are only valuable if the share price increases over the vesting period. In theory, this gives executives an incentive to manage the company well so that the share price rises. But if the options are issued at a discount, that is, at less than the market price of the shares, executives have less reason to work to increase the share’s price.

Why SHARE Voted AgainstChartwell’s long-term incentive compensation plan was the executives’ long-term bonus plan, and directors were included in the plan. This is one reason SHARE voted against it.


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In addition, the plan used an unusual form of unit options (i.e. stock options; shares of a trust are called “units” instead of shares or stocks). usually, options allow the recipient to purchase shares or units at a set price after the vesting period. The price should be the market price for the units on the date the options are awarded. For long-term options awards, the vesting period is several years. At the end of the vesting period, the recipient pays the price that was set at the time the options were awarded, and then owns the units.

But in this plan, the executives and directors who were awarded the options only paid 5% of the market price of the units. The remainder of the price for each unit would be covered by the distributions that would have been paid for each unit over the options’ vesting period. This is, in effect, a 95% discount on the price of the units awarded to the executives and directors. Options are only valuable if the unit price increases over the vesting period. In theory, this gives executives an incentive to manage the company in a way that makes the unit price rise. But if the options are issued at a discount, that is, at less than the market price of the units, executives have less reason to work to increase the unit price. In this case, the discount is so large that options provide very little incentive. Recipients of the options are certain to be able to buy the units at a favourable price even if the unit price falls by as much as 94%.

Chartwell’s proposed amendment would have added another 10 years to the period that recipients of these options have to purchase the underlying units. SHARE voted against it because the options are discounted, and because it includes directors in a performance-based options plan.

Sherritt International CorporationProposal: Eliminate special payments to directors (Shareholder proposal)SHARE’s Vote: ForVote Result: 49.13% For

The Issue: Retirement Benefits, Severance Pay, Or Perquisites For Directors SHaRE’s position: Perquisites, retirement benefits and severance pay are not appropriate for directors. These types of compensation can increase directors’ financial reliance on the corporation, and this reliance may compromise director independence.

Why SHARE Voted ForSherritt International has operations in Cuba. The uS’s Helms-Burton act prohibits anyone from entering the uS if that person works for a company that has “trafficked” in american-owned property that was confiscated by the Castro regime. However, this provision of the act has been enforced inconsistently. Sherritt International is the only company whose executives have ever been banned from the uS under this provision.

as a result, some of Sherritt’s directors may be banned from travel to the united States. Sherritt pays these directors a bonus to compensate them for the inconvenience they face as a result. This shareholder proposal asked the company to eliminate these payments. It also asked the company to eliminate other perquisites that directors receive, such as trips and meals for their family members, and a parking allowance. SHARE voted for this proposal because perquisites are not appropriate for directors.


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EXECUTIVE COMPENSATIONQuebecor Inc.Proposal: Advisory vote on executive compensation (Shareholder proposal)SHARE’s Vote: ForVote Result: 15.78% For (80.5% of minority shareholders voted for)as noted earlier, Quebecor’s majority shareholder controls 73% of the company’s voting rights.

The Issue: Advisory Vote On Executive Compensation (“Say On Pay”)SHARE’s position: Companies that put their compensation reports or policies to a vote at the annual shareholders’ meeting give shareholders a say on the form and amounts of the compensation given to executives. These votes are often referred to as “say on pay.” SHARE votes for proposals that ask companies to submit their compensation policies or compensation committee reports to an advisory vote of shareholders. The Canadian Coalition for Good Governance also supports the adoption of “say on pay” votes.

Why SHARE Voted ForSHARE voted for this proposal. An advisory vote on executive compensation allows shareholders to express their views of executive compensation, while still recognizing the board’s responsibility to set executive pay.

Crescent Point EnergyProposal: Advisory resolution accepting the company’s approach to executive compensationSHARE’s Vote: AgainstVote Result: 43.33% Against

The Issue: Excessive Executive CompensationSHARE’s position: Executive compensation is a controversial area of corporate governance. Compensation must be attractive enough to draw, motivate, and keep qualified executives. However, executive compensation is widely perceived to be excessive. High levels of executive compensation have been found to correlate with financial misrepresentation. Several studies have shown that high levels of executive pay substantially increased the probability that a company would misreport its financial results.

SHARE votes against executive compensation if it believes that compensation is excessive.

Why SHARE Voted AgainstCrescent Point Energy’s executive compensation is excessive. The company paid its top five executives 20% of its net income in 2013, which is well above the 1% that SHARE believes is reasonable. Crescent Point sets its target executive pay at the 75th percentile of its peer group, a practice that often contributes to excessive levels of compensation. This may have contributed to the high levels of executive compensation at the company, and the high shareholders’ vote against the executive compensation.


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Goldcorp Inc.Proposal: Advisory resolution accepting the company’s approach to executive compensationSHARE’s Vote: AgainstVote Result: 25.22% Against

The Issue: Performance-Based CompensationSHARE’s position: Executives are motivated to excel when their compensation is tied to their performance. Most of executives’ compensation and all of their incentive compensation should be based on performance. SHARE votes against executive compensation plans that do not include performance-based compensation. Executives’ bonuses, commonly called incentive compensation, should also be based on performance and should only be awarded for good performance. SHARE votes against incentive compensation that is not based on performance.

The Canadian Coalition for Good Governance takes a similar position. It says that a significant portion of executives’ pay should be based on their performance.

Why SHARE Voted AgainstTwo-thirds of the executives’ long-term incentive plan consisted of restricted share units and stock options. The value of these awards depends entirely on Goldcorp’s share price, not on how well the executives perform. SHARE voted against this proposal because most of the executives’ long-term bonuses were not based on performance.

Goldcorp argues that share price is a measure of how well the company is doing. However, share price is not a fair measure of executives’ performance because it often influenced by factors that are beyond the executives’ control. Share prices can rise or fall for reasons that have nothing to do with the company’s performance. For example, the price of gold has a strong effect on the value of Goldcorp’s shares, regardless of how well or how poorly the company is doing.

Talisman Energy Inc.Proposal: Policy on executive compensation awards in event of change in control (shareholder proposal)SHARE’s Vote: ForVote Result: 47.55% For

The Issue: Severance Benefits And Change In Control Of A CompanySHaRE’s position: Changes in control of a company, such as mergers and acquisitions, have a significant effect on share-based compensation. Share-based compensation plans often include provisions that allow share-based grants to vest immediately and in full if ownership or control of the company changes. These provisions can result in large payments to executives, often tens of millions of dollars. This creates an incentive for executives to pursue changes in control that benefit them even if they do not benefit the company or its other stakeholders.

Why SHARE Voted For:This proposal asked Talisman Energy to change how executives’ share-based bonuses are treated if those executives are laid off as the result of a change in control of the company. Instead of allowing the bonuses to vest in full, the proposal asks Talisman to pay executives only as much of the bonus as would have vested pro rata at the time the executive is laid off. This is entirely fair; it gives executives the bonus they would have received at the point


79

when their employment with the company ends, instead of the full amount that they might have received at the end of the performance period. It would also help to reduce the substantial amounts that Talisman’s executives could be paid for a merger or takeover of the company. SHARE voted for this proposal.

Agnico Eagle Mines LimitedProposal: Advisory resolution accepting the company’s approach to executive compensationSHARE’s Vote: AgainstVote Result: 23.14% Against

The Issue: Share-Based Compensation And VestingSHARE’s position: Share-based compensation should have a minimum vesting period before it can be exercised. Share-based compensation is not an effective tool for encouraging executives to manage for the long term if the awards can be exercised as soon as they are granted. Share-based compensation should be held for at least three years to promote long-term stock holdings. In some situations, a board should be able to extend or waive vesting periods, but these should be exceptional cases.

Why SHARE Voted AgainstThe shareholders’ vote against this proposal was less than the 25% threshold normally used to select issues for this survey. However, SHARE believes this issue is important enough to include despite that.

agnico Eagle’s long-term incentive plan includes stock options. Twenty-five percent of those stock options vest on the date they are granted. This means that one-quarter of executives’ long-term bonus is not long-term at all, since executives can acquire those shares immediately. This undermines the effectiveness of the awards as an incentive to manage the company well for the long term.

The North West Company Inc.Proposal: Adopt a policy setting a normal retirement age of 65 years for executives (Shareholder proposal)SHARE’s Vote: ForVote Result: 35.71% For

The Issue: Executive Compensation, GenerallySHARE’s position: SHARE votes for executive compensation plans that it believes are fair, and will oppose those it believes are excessive. One criterion for a fair compensation plan is that the total compensation for executives is reasonable compared with all pay levels within the company. In deciding how to vote on executive compensation, SHaRE considers the entire compensation package, including all bonuses, benefits and retirement plans.

Why SHARE Vote For:Currently, the North West Company’s executive retirement plan allows the executives to receive a full defined-benefit pension at age 60 with only 10 years of service. This makes the executives’ retirement plan unnecessarily expensive for the company. The shareholder proposal asked the company to make age 65 the normal retirement age for executives, instead of age 60. Executives could still retire before age 65 if they wish, but they would not


80

receive a full pension. The proposed change would help to limit the cost of the plan, without creating undue hardship for the executives.

Trican Well Service Ltd.Proposal: Advisory resolution accepting the company’s approach to executive compensationSHARE’s Vote: AgainstVote Result: 17.22% against

The Issue: Change-In-Control Compensation SHARE’s position: As discussed earlier, compensation plans often include provisions that allow share-based pay to vest immediately if ownership or control of the company changes. These provisions can create an incentive for executives to pursue changes in control that benefit them but not other shareholders. This problem can be addressed by allowing an executive’s share-based compensation to vest if a change of control takes place, but only if the executive also loses his or her job with the company as a result. These are called “double-trigger plans,” as opposed to “single-trigger plans,” which require only a change of control for share-based awards to vest.

The Canadian Coalition for Good Governance says that any change of control provision should have a “double trigger” requirement. SHARE votes against compensation plans that allow an executive’s share-based compensation to vest if a change in control takes place, unless the executive’s employment with the company is terminated as a result of the change in control.

The shareholders’ vote against this issue was also lower than our 25% threshold for inclusion in the survey. However, this issue is also an important one for investors especially in light of how often companies’ merge or acquire each other.

Why SHARE Voted AgainstA large part of Trican’s executives’ share-based pay vests in full if control of the company changes, regardless of whether or not the executives continue to be employed by the new company. As a result, executives could each receive approximately $2 million to $3 million for a change in control of the company without losing their jobs. This potential windfall creates incentives for executives to pursue changes in control regardless of the consequences for the company, the shareholders, their employees, and other stakeholders.

Blackberry LimitedProposal: Accept the company’s approach to executive compensationSHARE’s Vote: AgainstVote Result: 33.38% Against

The Issue: Severance BenefitsSHaRE’s position: Executive severance benefits are controversial, especially when they result in large payments to executives who have performed poorly. Severance benefits should not be paid to executives who are fired or who resign in lieu of being fired for poor performance.


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The amounts of compensation in executives’ severance arrangements can be excessive, especially in light of the amounts of other compensation that executives typically receive.

Why SHARE Voted Against:SHaRE had many concerns with this compensation plan. Blackberry’s compensation is excessive, especially considering its ongoing poor performance. Our primary concern related to the compensation of the outgoing and incoming CEOs. under the leadership of mr. Heins, Blackberry failed to achieve a turnaround and shareholder value depreciated significantly. However, his severance package was an astonishing $49.7 million. The practice of lucrative pay continues at Blackberry with the newly hired CEO, mr. Chen. mr. Chen was given a sign-on bonus of restricted shares worth $85 million. These shares have no performance requirements and vest solely through the passage of time. While we agree that Blackberry needs to attract good executives to regenerate its fortunes, this type of bonus is much higher than market norms. And without performance requirements for this bonus, Mr. Chen could, like Mr. Heins, be handsomely rewarded for failure.

OTHER CORPORATE GOVERNANCE ISSUESCameco CorporationProposal: Resolved, that the amended restated Bylaw no. 7 of Cameco Corporation be and is confirmedSHARE’s Vote: AgainstVote Result: 23.01% AgainstThe result of this vote was slightly below the 25% threshold we usually require to include issues in this survey. However, this issue is important enough for shareholders to warrant its inclusion.

The Issue: Second Votes Or “Casting” VotesSHARE’s position: Some companies include in their bylaws a provision that allows the chair of the board or of a committee to cast the deciding vote on an issue if there is a tied vote at a meeting of shareholders, a board meeting, or committee meeting. This additional vote is called a casting vote or a second vote. This practice gives the chair of the board or committee one vote more than other directors or shareholders. SHARE votes against bylaws that include casting votes.

Why SHARE Voted Against:The bylaw Cameco asked shareholders to approve included a provision that allows for a casting or second vote for the chair at shareholders’ meetings. This is not in the best interests of shareholders because it gives the chair more votes than other shareholders have.


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Transglobe Energy CorporationProposal: Approve by-law number 2 of the company relating to the advance notice of nomination of directorsSHARE’s Vote: Against Vote Result: 49.85% Against

The Issue: Shareholder Nominations For Director And Advance Notice RequirementsSHARE’s position: Shareholders should have the right to nominate directors provided that the nominees are well-qualified and prepared to act in the interests of all shareholders. Shareholders have this right in Canada and in some other jurisdictions.

Recently, many Canadian companies have adopted “advance notice requirements” that set out time limits and other rules for shareholders who wish to nominate directors. These requirements are acceptable as long as they do not unnecessarily limit shareholders’ ability to exercise their right to nominate directors.

Shareholders who nominate a candidate for director should provide the same information about their candidate’s qualifications, independence, and potential conflicts of interest as companies provide for their nominees. Nominations should be provided to the company in time to include candidates’ information in the company’s proxy information circular and on the proxy ballot. For companies in Canada, the usual time period is 30 to 65 days before the shareholders’ meeting.

Why SHARE Voted Against This bylaw included an advance notice requirement that allowed the company to omit information about shareholders’ nominees from the proxy circular. This defeats what should be one of the purposes of advance notice requirements, which is to include information about shareholders’ nominees for director in the company’s proxy circular. This may be one of the reasons almost half of Transglobe’s shareholders voted against the proposal.

Bankers Petroleum Ltd.Proposal: Approve by-law no. 1 of the companySHARE’s Vote: Against Vote Result: 44.41% Against

The Issue: Quorum Requirements For Shareholders’ MeetingsSHARE’s position: The quorum for a shareholder meeting is determined as a percentage of total voting shares represented either in person or by proxy. Some companies consider a quorum to be as little as 10% of the voting shares. But this threshold is too low. It allows companies to make decisions that require shareholder approval without consent from the owners of 90% of the shares.

The appropriate quorum size for a company depends on how widely held the company is. No company should have a quorum of less than 25%. Even at this level, companies can make decisions without the participation of three-quarters of the shareholders. Companies with dominant shareholders should set higher quorum requirements.

Why SHARE Voted Against: This proposed by-law would have set the quorum requirement for shareholders’ meetings at 15% of the shares eligible to vote, which is too low.


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CORPORATE SOCIAL RESPONSIBILITYAlimentation Couche-Tard Inc.Proposal: Report annually on the environmental and social performance of the corporation (Shareholder proposal)SHARE’s Vote: ForVote Result: 10.92% For (45.7% of minority shareholders voted For)

The Issue: Reports On Social And Environmental Issues SHARE’s position: Corporations have a responsibility to disclose to their shareholders the potential liabilities of their operations, including the risks associated with social and environmental aspects of their operations. Risks associated with social and environmental issues have meaningful, material consequences for a company’s profitability, but these risks are often not fully disclosed to investors. Reports on environmental and social performance are an excellent means for doing this.

This disclosure may be included in sustainability reports with other information on the company’s social and environmental performance. Sustainability reports should be made in the normal course of reporting to shareholders. SHARE votes for proposals to provide shareholders with sustainability reports.

Why SHARE Voted ForAs noted earlier, Alimentation Couche-Tard has a dual-class share structure that allows the owners of the multiple-voting shares to control 77% of the company’s voting rights. Thus, the 10.92% vote in favour of this proposal represents the votes of 45.7% of the holders of subordinate voting shares.

This shareholder proposal asked Alimentation Couche-Tard to report annually on its social and environmental performance, and to adopt a sustainability strategy. In its argument against the proposal, the company points out that it has begun to include some of this information in its annual report. This is, in fact, a good argument in support of the proposal, since the proposal does not require the sustainability report to be separate from the annual report. A report on the company’s social and environmental performance, including its plans to address any potential risks it faces, would benefit the company and its stakeholders.


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Appendix

Who responded?The 2014 Key Proxy Vote Survey was sent to 60 investment managers and proxy voting services that vote the proxy ballots of Canadian companies for Canadian pension funds.

Firms that participated in the surveyThirty-eight proxy voting services and investment managers took part in the survey, including funds of investment managers whose proxy ballots were voted by different groups within the firms. This is a participation rate of 63%.

Fourteen of these firms have been participating in the Canadian Key Proxy Vote Survey for seven years or more. These firms are marked with an asterisk.

• allianceBernstein Institutional Investments• Amundi Asset Management Canada• Beutel, Goodman & Company Ltd.*• Blackrock Inc.• CIBC asset management Inc.• Connor Clark & Lunn Financial Group• Fidelity Investments Canada Limited*• Fiera Capital Inc.• Foyston, Gordon & Payne Inc.• GE Asset Management Incorporated• Genus Capital Management Inc. (Fund A)• Genus Capital management Inc. (Fund B)• Glass Lewis & Co. LLC*• Greystone managed Investments Inc.*• Groupe Investissement Responsable*• Gryphon Investment Counsel Inc.*• Hexavest• Highstreet asset management Inc.*

• Hillsdale Investment Management Inc.• Invesco Canada Ltd - PowerShares Funds• Invesco Canada Ltd (Toronto-managed funds)• Invesco Canada Ltd (uS-managed funds)• ISS Canada - Proxy advisory Services*• ISS Canada - Social advisory Services*• ISS Canada -Taft Hartley advisory Services*• J. Zechner Associates Inc.• Leith Wheeler Investment Counsel Ltd.*• Lincluden management Ltd.• manulife asset management*• marco Consulting Group*• Mawer Investment Management• Proxy Vote Plus*• RBC Global asset management*• Russell Investments Canada Ltd.• Seamark asset management Ltd.• Sionna Investment Managers• State Street Global advisors Ltd.• Toron - amI International asset management*

Firms that declined to participateFour firms responded to the survey by informing SHaRE that they would not participate. • Brookfield Soundvest Capital management• Letko, Brosseau & associates Inc.• Scheer, Rowlett & associates Investment management Ltd.• Van Berkom & associates


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Firms that did not respondThe following 22 firms did not respond to the survey at all.

Five of these firms publish their proxy voting records on their websites. These firms’ votes on the issues in the survey are included in the section “Voting records of firms that did not participate”, in this appendix.

• 1832 asset management Ltd.• Aberdeen Asset Management Inc.• Acuity Investment Management Inc.• Aston Hill Institutional Partners• Aurion Capital Management Inc.• Bissett Investment management• BmO asset management Inc.• Burgundy asset management Ltd.• deans Knight Capital management Inc.• Galileo Global Equity Advisors Inc.• GLC asset management Group Ltd

• Gluskin Sheff & Associates Inc.• HSBC Global asset management (Canada) Ltd• Jarislowsky, Fraser Limited• MFS Investment Management• montrusco Bolton Investments Inc.• PCJ Investment Counsel Ltd.• Pembroke management Ltd.• Standard Life Investments Inc.• Td asset management Group• uBS Global asset management (Canada) Inc.• Wellington management Company LLP

Survey results at a glance

2014 2013 2012ProposalsNumber of proposals surveyed 27 21 25Number of management proposals surveyed 20 17 19Number of shareholder proposals surveyed 7 4 6

Responses Participation rate 63% 60% 52%Number of participating firms 38* 40† 32*Number of firms that did not respond 22 24 26Number of firms that declined to participate 4 2 5*One of these firms gave a partial response; †Two of these firms gave a partial response


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2014 2013 2012

Characteristics of participating firms assets (in Cad$ billions)Total assets under management by participating firms $1490.6* $1456.2* $1199.4** Not all participating firms reported their assets under management

Proxy voting systems employed by investment managers*used recommendations from a proxy service 26% 22% 13%Relied on an in-house proxy voting staff person 26% 33% 34%Relied on individual portfolio managers 24% 10% 22%Relied on an internal proxy voting committee 34% 38% 31%Other 24% 21% 19%* Results total more than 100% because some firms use more than one system

Proxy voting guidelinesFirms with proxy voting guidelines 87% 97% 97%Firms that disclose their guidelines publicly 36% 59% 56%

Proxy voting reports*Firms that report to clients how their proxy votes have been cast 92%† 97%† 97%†*One firm issued reports if its clients request them† Results total more than 100% because some firms issue reports at more than one interval

Public disclosureFirms that disclose all or some of their proxy votes publicly 42% 51% 41%


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Voting Records of Investment Managers That Did Not ParticipateSome of the investment managers who did not respond to the survey publish their proxy voting records on their websites. Those votes are recorded here. Issues and companies that these firms did not hold have been omitted.

Table 38: Bissett Investment management Public Voting Record


Same as SHARE’s





proposal) For


Canadian Imperial Bank Of Commerce


Power Corporation Of Canada Elect a director: Laurent dassault Against/Withheld







Against/Withheld r




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Table 39: BmO asset management Inc. Public Voting Record


Same as SHARE’s


Appoint the auditors of the corporation for the ensuing year Abstain r



proposal) For









Executive CompensationCrescent Point Energy Corp. Advisory resolution accepting the company’s approach to executive

compensation For


Against/Withheld r



Against/Withheld r







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Table 40: montrusco Bolton Investments Inc Public Voting Record


Same as SHARE’s



Election of DirectorsTransforce Inc. Elect a director: alain Bédard For r





Other Corporate Governance IssuesTransglobe Energy Corporation


Against/Withheld


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Table 41: Standard Life Investments Inc Public Voting Record


Same as SHARE’s





proposal) For





Imax Corporation Elect a director: Garth M. Girvan Against/Withheld r

Power Corporation Of Canada Elect a director: Laurent dassault Against/Withheld r





Executive Compensationagnico Eagle mines Limited Advisory resolution accepting the company's approach to executive

compensation For r


Against/Withheld


Quebecor Inc. Advisory vote on executive compensation Against/Withheld r






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Table 42: Td asset management Group Public Voting Record


Same as SHARE’s

vote?Appointment of AuditorsEnbridge Inc. appoint PricewaterhouseCoopers LLP as auditors. For r


proposal) For





Power Corporation Of Canada Elect a director: Laurent dassault For r







Executive CompensationBlackberry Limited Accept the company's approach to executive compensation Against/

WithheldCrescent Point Energy Corp. Advisory resolution accepting the company's approach to executive








Against/Withheld

(table continued)


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Same as SHARE’s

vote?Other Corporate Governance IssuesBankers Petroleum Ltd. Approve by-law no. 1 of the company Against/





Against/Withheld




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How Proxy Issues Are Selected For Inclusion In The SurveyTo be included in the survey, proposals must have appeared on the ballots of Canadian companies. They had to meet the following criteria:

1. They were put before shareholders for a vote between 1 July 2013 and 1 July 2014.

This range of dates coincides with the end the second quarter, which is often considered the end of the proxy voting season. It also allows us to include issues that appear on the ballots of companies that hold their annual shareholders’ meetings outside the traditional spring proxy season.

2. They appeared on the ballots of companies that were in the S&P/TSX Composite Index as of 15 July 2014. Most pension plans’ Canadian stock holdings are primarily in companies on the index.

3. They addressed issues that are covered in SHARE’s Model Proxy Voting Guidelines.1

We made exceptions to this criterion when proposals raised issues that we believed were of particular interest to shareholders.

4. For management proposals, the proposal won less than 75 percent of the votes cast, with three exceptions. The exceptions were made for proposals where it was highly improbable that less than 75 percent of shareholders would vote for the proposal. Specifically:

a. Proposals at companies where a small number of shareholders control a large portion of the votes. This exception allows the survey to more accurately reflect the position of pension funds, which are usually minority shareholders in these companies.

b. Proposals for the election of directors and appointment of auditors. Shareholders cannot vote against these proposals; they can only vote for them or withhold their votes. Shareholders do not customarily withhold their votes for directors and auditors. A “withhold” vote of more than 10 percent for a director or auditor is unusual.

c. Proposals on the ballots of companies that did not disclose the numeric results of their shareholders’ votes. This was done to avoid biasing the survey against companies that do disclose the numeric results of shareholder votes.

5. For shareholder proposals, the proposal won more than 15 percent of the votes cast.

However, we applied the same exceptions for controlled or closely held companies and companies that did not disclose their numeric vote results that we applied to management proposals.

using these criteria, we selected issues from the ballots of Canadian companies for inclusion in the survey.

The 2014 Key Proxy Vote Survey was sent to 60 investment managers and proxy voting services who vote the proxy ballots of Canadian companies for Canadian pension funds. The survey forms were sent to recipients on 4 September 2014. The deadline for responses to the survey was 3 October 2014.

1 The SHARE guidelines were developed in 2002 and are revised annually, with the advice and guidance of a committee of experts in corporate governance and socially responsible investing. The guidelines serve as a model to assist Canadian pension funds in developing their own proxy voting guidelines and evaluating proxy voting done by voting agents. The guidelines are available on SHARE’s website, www.share.ca.


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How Participating Firms’ Votes Compare to Meeting Vote Results, By Proposal SHaRE compared how the participating firms’ voted as a group on each ballot issue in the survey. The table below shows these results and how they compare to the vote results of all of the company’s shareholders at the company’s annual meeting.

For example, SHARE recommended voting for the shareholder proposal asking Alimentation Couche Tard to adopt majority elections for directors. Thirty of the firms that participated in the survey voted on this shareholder proposal, and all of those thirty firms voted for the proposal, or 100 percent. However, at the annual shareholders’ meeting of alimentation Couche Tard, 21.69 percent of the shares were voted in favour of that proposal.

As noted in the table, some companies did not report the numeric results of their shareholders’ votes, but only that an issue on the ballot passed or did not pass.

Table 43: Votes Of Survey Participants and all Shareholders, By Proposal

Company Name Proposal SHARE vote Votes that Match SHARE’sVotes of survey

participantsVotes of all

shareholdersRaw Score %Agnico-Eagle Mines Limited

Advisory resolution accepting the company's approach to executive compensation

Against 8 of 21 38% 23.14%

Alimentation Couche-Tard Inc.

Adopt a majority voting policy for elections of directors (Shareholder proposal)

For 30 of 30 100% 21.69%

Alimentation Couche-Tard Inc.

Report annually on the environmental and social performance of the corporation (Shareholder proposal)

For 23 of 30 77% 10.92%

B2Gold Corp. approve the RSu plan resolution relating to the amendment of the RSu plan

Against 8 of 18 44% 39.58%

Bankers Petroleum Ltd. Approve by-law no. 1 of the company Against 13 of 19 68% 44.41%Baytex Energy Corp. Elect a director: John a. Brussa Withhold 7 of 21 33% 26.35%Blackberry Limited Accept the company's approach to executive

compensationAgainst 15 of 17 88% 33.38%

Cameco Corporation Resolved, that the amended and restated Bylaw no. 7 of Cameco Corporation be and is confirmed

Against 7 of 26 27% 23.01%

Canadian Energy Services & Technology Corporation

Appoint the auditors of the corporation for the ensuing year

Withhold 6 of 18 33% Numeric results not reported


Elect a director: L. Rahl Withhold 6 of 33 18% 14.91%


Against 9 of 19 47% 35.84%


Approve certain amendments to the long term incentive plan.

Against 11 of 16 69% 48.33%

(table continued)


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Company Name Proposal SHARE vote Votes that Match SHARE’sVotes of survey

participantsVotes of all

shareholdersRaw Score %Crescent Point Energy Corp.

Advisory resolution accepting the company's approach to executive compensation

Against 15 of 25 60% 43.33%

Element Financial Corporation

Authorize and re-approve the amended share option plan

Against 7 of 19 37% 32.56%

Enbridge Inc. appoint PricewaterhouseCoopers LLP as auditors.

Withhold 3 of 29 10% 1.57%

Enerplus Corporation Elect a director: Glen d. Roane Withhold 5 of 21 24% 9.45%Goldcorp Inc. Advisory resolution accepting the company's

approach to executive compensationAgainst 12 of 30 40% 25.22%

Imax Corporation Elect a director: Garth M. Girvan Withhold 11 of 13 85% 45.69%North West Company Inc. (The)


For 9 of 17 53% 35.71%

Power Corporation of Canada

Elect a director: Laurent dassault Withhold 21 of 27 78% 18.65%

Quebecor Inc. Advisory vote on executive compensation (Shareholder proposal)

For 21 of 26 81% 15.78%


For 26 of 26 100% 99.82%


Eliminate special payments to directors (Shareholder proposal)

For 11 of 15 73% 49.13%


For 19 of 25 76% 47.55%

Transforce Inc. Elect a director: alain Bédard Withhold 6 of 20 30% Numeric results not reported



Against 10 of 15 67% 49.85%


Against 6 of 20 30% 17.22%


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SHARE’s votes on each of these issues was contrary to the recommendations of the company’s management.2 This table shows that the firms that took part in the survey were more willing than most shareholders to vote against the companies’ recommendations. Shareholders can vote with management’s recommendations by ticking a single box on a proxy ballot. In order to vote against management’s recommendations, shareholders must review the issues on the ballot and make a decision about whether or not to accept the company’s arguments in favour of each one, after reading the relevant proxy materials. Thus, the information in this table suggests that the firms that participate in the survey put considerable effort and care into proxy voting.

2 There is one exception to this. The management of Quebecor recommended that shareholders vote for shareholder proposal #2, and SHARE voted for that proposal.


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