Barbara Stymiest, CEO of the TSX Group, told the Global Business Forum 2002 in Banff, Alta, this morning that importing the Sarbanes-Oxley corporate accountability reforms to Canada would be an intolerable burden for smaller companies.

“Just on our size differences alone, trying to import the U.S. corporate governance rules into Canada would impose a virtually intolerable, added burden on our smaller companies for no discernible benefit,” said Stymiest. The Ontario Securities Commission has taken the position that many of these reforms should be adopted in Canada, unless there is a compelling reason not to adopt them. The B.C. Securities Commission has sided with the TSX.

Stymiest told delegates that Canada has gone down the road toward voluntary compliance and mandatory disclosure where the discipline comes from investors more than the regulators. She noted that a recent OSC review found that of 517 companies, that there’s been no serious evidence of wrongdoing among Canadian companies. “That result, I would suggest, is not an accident,” said Stymiest. “It’s a direct result of the basic soundness of our approach to governance.”

“New U.S. rules apply equally to all companies, large or small. But smaller companies will bear a comparatively bigger burden because, for the most part, they don’t have the elaborate corporate structures and support staff of larger companies,” said Stymiest. “The smallest 44% of American companies, with market capitalization of up to US$500 million are a lot better placed to carry the cost of the new rules than the 81% of Canadian companies with a market less than $50 million Canadian.”

Stymiest also touched on the subject of the composition and structure of corporate boards, saying that in Canada, 70% of the largest public companies already split the role of CEO and Chairman. “They’re not required to. Our guidelines recommend it.”