Peter Dey, the architect of Canada’s first corporate governance guidelines for boards, is convinced that the power of directors has been eroded on that  balance of power has shifted too far to shareholders on key issues.

Dey's remarks were made in a speech at the ICGN annual conference this week after he received the Lifetime Achiever Award in recognition for his role in developing governance guidelines for companies on the Toronto Stock Exchange in 1994. He later helped the OECD with its global governance guidelines.  

"There is a trend for shareholders to try to involve themselves in issues which, under our corporate model, should be within the purview of the board,” he said. One key example, he says, is say on pay, “Is say on pay the beginning of a trend? Will shareholders want to vote on a company’s environmental policy, on its health and safety policy, and so on?”

In an interview with  Janet McFarland of Canada's Globe and Mail Dey said that he supported shareholder activism by advocacy groups like the Canadian Coalition for Good Governance (CCGG), but said their best tool is the use of private conversations with a board, not “public confrontations.” Ironically CCGG is one of Canada’s strongest advocates for shareholder approval of executive pay.