Legal news and trends for Canadian in-house counsel and c-suite executives
Issue link: https://digital.canadianlawyermag.com/i/50875
non-governmental organizations," explains Love. "So some of those are stakeholder issues, and some of them are shareholder activism." Like many Canadian companies, Enbridge has also recently faced a rising number of issues brought forward via shareholder proposals for annual meet- ings. "The list of issues that are brought forward in shareholder proposals is huge," she says. But Love and her colleagues have learned to manage that onslaught. They have done so at times by meet- ing with shareholders before the annual meetings to find ways to come to agree- ments — with, for example, disclosure provisions — that allow the issues to be resolved before the shareholder meeting. To be sure, the role of in-house counsel 2012 BRITISH COLUMBIA LEGAL TELEPHONE DIRECTORY GET NAMES, MAILING ADDRESSES, EMAIL ADDRESSES AND PHONE NUMBERS FOR LAWYERS AND LAW OFFICES IN B.C., NUNAVUT, NORTHWEST TERRITORIES AND THE YUKON In one handy volume you'll have a single means of access to every lawyer and law firm in B.C., Northwest Territories, Nunavut and the Yukon. Published annually, the current edition includes: This directory has: Visit canadalawbook.ca or call 1.800.387.5164 for a 30-day no-risk evaluation is crucial when it comes to sharehold- er activism. Love says their role begins when a shareholder submits correspon- dence detailing a proposal. The member of the legal team taking charge of the file — whether general counsel, corporate secretary, or another member of the in- house team — would then communicate it to other senior management and other members of the business team who will become engaged in the issue. In-house counsel will also often attempt to arrange a meeting with the shareholder, or share- holder group, to see if it's possible to negotiate or resolve the issue before the shareholder meeting. The lawyer will also be charged with drafting correspondence between the parties. If a resolution cannot be reached, the in-house counsel will also work to draft the response to the proposal as it appears in the proxy circular. Perhaps most importantly, it's essen- tial for in-house counsel to be open and available for shareholders, she says. That means providing contact information and responding to shareholder inquiries promptly. "You can't be delayed for a month in getting back to somebody," she explains. "You have to be as responsive as you can be in the circumstances." Osler's Pressman identifies three types CANADA LAW BOOK® of activist shareholders that in-house counsel must learn to identify. He refers to the most common type of activists as "value maximizers." This group consists of the more conventional shareholder activ- ists, such as hedge funds, investors, and other value-drivers looking to get the most out of their investments. They will careful- ly examine companies' capital structures, balance sheets, stock prices, and conduct financial analysis. "They might pile into a stock on the basis that they think that they can instigate change that creates more value," explains Pressman. "Or they may be a pre-existing shareholder or investor who doesn't like the direction of the stock price and in combination with its analysis of the financial climate, may say it's time to instigate some change here; our stock price hasn't moved, and we think we can do a better job." So these value maximizers are essentially looking for ways to enhance 26 • AUGUST 2011 ntitled-3 1 INHOUSE 6/27/11 9:55:43 AM