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You are here: Home / Articles / Changes to the Canada Not-for-Profit Corporations Act – No Diversity Provisions

Changes to the Canada Not-for-Profit Corporations Act – No Diversity Provisions

October 19, 2016

By: Karen Cooper

As part of a legislative package intended to promote corporate transparency and diversity, Bill C-25 An Act to amend the Canada Business Corporations Act, the Canada Cooperatives Act, the Canada Not-for-profit Corporations Act and the Competition Act (“Bill C-25”) introduces changes to various federal corporate laws.  The main purpose of Bill C-25 is to make changes to the Canada Business Corporations Act (“CBCA”) that will increase shareholder democracy and participation, increase women’s representation, as well as diversity, on corporate boards and in senior management,  improve corporate transparency, and reduce the regulatory burden and increase certainty for business corporations.

Because many of these changes were already incorporated into the Canada Not-for-profit Corporations Act (“CNCA”), the changes being made to the CNCA are largely technical.  The main changes related to the introduction of a definition of an “incapable” person that does not require a declaration by a Court (other mechanisms provided by provincial legislation would also apply) and related changes to the language in subsection 6(2), 78(1), and 126(1).  Other amendments relate to the functions of the Director of Corporations Canada, making the language parallel to new provisions in the CBCA.  Finally, a small number of minor amendments simplify or clarify language.

One of the changes to the CBCA that does not appear to have been included in the amendments to the CNCA are those directed at improving the representation of women on boards and in senior management.  Under the CBCA, all distributing corporations will be required to disclose their diversity representation and policies or explain why none are in place.   It is unclear whether similar requirements were considered for not-for-profit corporations.  Research conducted in 2009 found that women held 44% of the Board positions in the not-for-profit sector and suggested that the bigger hurdle in the sector is and achieving more broad based diversity including visible minority and new immigrant representation.  In 2013, the Ontario Nonprofit Network (“ONN”) undertook a survey that illuminated the leadership of not-for-profit organizations in Ontario.  They found that not-for-profit leadership did not reflect the communities which they served: 13 percent of 810 leaders who responded were visible minorities and 20 percent were immigrants, compared to 26 percent of Ontarians who are visible minorities and 30 percent who are immigrants.

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Filed Under: Articles, Charities - Article Archive, Charities - Current Articles Tagged With: Bill C-25, Board of Directors, Canada Business Corporations Act, Canada Not-for-Profit corporations act, CBCA, CNCA, corporate transparency, definitions under the CNCA, diversity, Karen Cooper, regulations

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