Our fifth annual governance ranking shows that Canadian boards are changing their ways.
Canadian directors have been cleaning up their act since the collapse of WorldCom and Enron nearly five years ago sparked a North American corporate governance revolution. While governance was once merely a footnote in a company's annual report, now many of Canada's largest corporations brag about their independent directors, the top-notch financial experts sitting on their audit committees and their beefed-up board oversight.
Want proof of the dramatic overhaul in Canada's boardrooms? Just look back to the first Canadian Business corporate governance survey, published in 2001. The median score for companies that made the cut of our 25 top boards was 55 out of 100. This year, the median score for our highest-ranked companies is 94--and that's after we added more rigorous criteria and tightened the scoring. Even companies that scored low have improved. Back in 2001, the median score for companies at the bottom of our governance survey was just three out of 100. This year, it's 23. But those dramatic increases have stalled. The median score for all the companies we examined this year, top and bottom, was 60, slightly above the median score of 57 last year.
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