TSX Group Inc. and TSX Inc. have applied to the Ontario Securities Commission to amend the definition of independent directors in their recognition order.

Currently, an independent director is as a director that is not: associated with a TSX participating organization; an officer or employee of TSX Group or its affiliates or an associate of such officer or employee; a person who owns or controls, directly or indirectly, over 10% of TSX Group; or, an associate, director, officer or employee of any person or company who owns or controls, directly or indirectly, over 10% of TSX Group.

TSX Group and TSX Inc. propose that the definition of independent director be deleted and replaced with the definition set out in new OSC rules regarding audit committees and the requirement that the board of directors adopt standards for determining when a director could be considered independent.

The proposed board standards would identify classes of individuals who are considered to have a material relationship with TSX Group or TSX Inc. and therefore are not considered to be independent, it says. “For example, an individual who is an employee, associate, or executive officer of a participating organization is considered to have a material relationship with TSX Group and TSX Inc. and is therefore considered not to be independent. However, the board of directors may determine that an individual who at first instance is considered to have a material relationship is nonetheless independent if the board of directors is satisfied that the relationship will not reasonably interfere with the exercise of the individual’s independent judgment,” it says. If the board of directors makes this determination, it must notify the commission.

Comments on the proposal are due by May 20.