Green but not Enough: Sustainability in Canadian Corporate Governance

In Beate Sjåfjell and Christopher M. Bruner (eds), Cambridge Handbook of Corporate Law, Corporate Governance and Sustainability (Cambridge University Press, Forthcoming).

University of Oslo Faculty of Law Research Paper No. 2019-16

Posted: 8 May 2019

See all articles by Poonam Puri

Poonam Puri

York University - Osgoode Law School

Date Written: May 6, 2019

Abstract

Canadian law adopts the corporate social responsibility model of environmental sustainability. This represents a weak sustainability approach, where environmental sustainability is justified only if there is a net positive impact on a company’s long-term financial performance. Corporate law constraints, such as the duties of loyalty and care, and the oppression remedy, have not traditionally required corporations to consider sustainability. However, courts have begun to move the common law in that direction, expanding the duty owed by the board of directors from shareholders to the corporation as a whole, including a consideration of stakeholder interests. Meanwhile, securities regulators have begun requiring environmental disclosure. Institutional investors, such as pension funds, have adopted climate change policies, and shareholder proposals regularly address environmental sustainability, although both tend to adopt a weak sustainability approach. Overall, under Canadian law, environmental sustainability appears to be important only insofar as it impacts the financial performance of companies.

Keywords: environmental sustainability, climate change, securities regulation, corporate social responsibility

Suggested Citation

Puri, Poonam, Green but not Enough: Sustainability in Canadian Corporate Governance (May 6, 2019). In Beate Sjåfjell and Christopher M. Bruner (eds), Cambridge Handbook of Corporate Law, Corporate Governance and Sustainability (Cambridge University Press, Forthcoming).; University of Oslo Faculty of Law Research Paper No. 2019-16. Available at SSRN: https://ssrn.com/abstract=3383430

Poonam Puri (Contact Author)

York University - Osgoode Law School ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

HOME PAGE: http://www.osgoode.yorku.ca/faculty/Puri_Poonam.html

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