In a speech Wednesday, John Manley, Deputy Prime Minister and Minister of Finance, told the Canadian Society of New York about Canada’s plans to tackle corporate governance issues.

“While the outlook for a global recovery has improved since last year, I would temper a prognosis of optimism with a fair degree of caution,” he said. “Markets continue to show nervousness in the wake of the Enron collapse and other corporate accounting scandals. As well, geopolitical instability, particularly in the Middle East, and financial crises in Latin America are taking their toll. And, of course, much depends on the United States. Although the U.S. recovery began earlier than expected, growth was weak in the second quarter. Consumer demand has strengthened, but the decline in stock markets this summer, along with continued weak employment growth, has raised concerns about the pace of the recovery.”

He also reused the image of Canada as an emerging “Northern Tiger”. “A very polite and self-effacing tiger, of course — he is Canadian — but a tiger nonetheless! Canada has earned its place at the forefront of the global economy. It is a place seen by investors the world over as having not only a competitive tax regime, but also a first-rate, knowledge-economy workforce and an unparalleled quality of life.”

Manley said that when he meets the finance ministers of the G-7, the IMF and the World Bank, this week in Washington, corporate governance will be on the agenda. “Enron, WorldCom – these are the kinds of scandals that have struck at our markets’ most important commodity: trust.”

“The bottom line is that we have all worked too hard to get to where we are today — and we have a great deal more to do. Today’s globalized economy is complex enough; we refuse to have to factor corruption into the business cycle as well,” he said.

Manley mentioned the recent passing of the Sarbanes-Oxley bill, and noted, “In Canada this issue is no less a priority, and we have recognized the need to take our own steps as well. Federal and provincial regulators and accounting standard-setters are also at work, which has led, as one example, to the recent establishment of a new oversight body for auditors of public companies. But more will be done.”

He said that Finance has identified five areas as critical to fostering and sustaining investor confidence: strengthening corporate governance; ensuring the accountability of senior executives; improving financial reporting; toughening enforcement; and doing more to enhance the credibility of the auditing process.

“But this is not only a job for government. The CEOs of Canada’s largest businesses have also shown their willingness to tackle this issue. On Thursday the Canadian Council of Chief Executives is scheduled to release a major statement on how corporate executives can take action to improve governance practices. I welcome their efforts, and I look forward to reviewing their comments in detail.”

The second economic challenge that will be discussed is emerging economies in crisis. “We have learned many lessons from past crisis, but clearly, a universal, lasting solution is elusive. One important critical step forward, however, would be the creation of a framework for resolving international financial crises that would function much the same as in domestic jurisdictions — through a system of rules and regulations, and with the authority to protect both creditors and borrowers. Such a system would not only provide a more orderly resolution of international financial crises, but it would also, we believe, help prevent these crises from occurring in the first place.”