It’s been three years now since the Toronto Stock Exchange introduced a program to encourage companies to voluntarily increase the proportion of women on their boards and in their executive offices.

At that time, women’s participation on boards of directors of the 60 largest companies listed on the TSX was a dismal 21 per cent. Worse, the ratio dropped to a meager 14 per cent when a broader selection of companies was taken into account.

Called “comply or explain,” the TSX program required listed companies to disclose how many women they have on their boards and in executive roles and it was recommended they adopt plans to improve their gender diversity.

Almost a year after that only 14 per cent of the 722 reporting companies had a formal plan in place for promoting women to their boards. Just 7 per cent had set specific targets.

So were companies just slow off the mark? Nope.

Almost two years later, a report from the law firm Osler, Hoskin & Harcourt found that CEOs were ignoring the message. Nearly half of all companies listed on the TSX still had zero women on their boards of directors, virtually unchanged from the year before. It also found that only 10 per cent had set targets for the number of female representatives on their board, only slightly up from the year before.

In other words, the “comply or explain” strategy was not working.

So it is welcome news that a group of senators is asking the federal Liberal government to toughen up legislation in Bill C-25, which is aimed at boosting diversity on corporate boards at publicly traded companies.

As it stands now, the legislation would amend the Canada Business Corporations Act to require publicly traded companies to disclose the number of women — and those from visible minorities — on their corporate boards and in senior management, along with their policies on diversity. If they fail to do so, companies would have to explain themselves to their shareholders.

The changes a group of senators are asking for aren’t much. Indeed, Independent Sen. Ratna Omidvar, one of the proponents of the changes, describes them simply as a “nudge.”

She is correct. The senators aren’t asking for quotas, as have been adopted by European countries such as Germany, Norway, France, Iceland and Spain.

Instead, the proposed changes would require companies merely to set percentage “goals” for designated groups such as women or visible minorities. They would also be required to establish a deadline for achieving those goals and to send an annual report to Parliament on how well they are doing.

It’s not much to ask of the government or Corporate Canada. The Trudeau government should listen and beef up Bill C-25.

It should also make plans to go further if this “nudge” doesn’t work, as Premier Kathleen Wynne promised to do back in 2016.

At that time Wynne directed that women make up at least 40 per cent of all appointments (not members) to provincial agencies, boards, commissions and Crown corporations by the end of 2019.

And she asked companies with at least one woman director to set a target by 2017 of appointing women to 30 per cent of the position on their boards, and to reach this goal within three to five years. For those that currently don’t have any female directors, the target would be to name one. One!

If those targets are not met, she said then, the government will consider regulations or legislation to make it happen.

Ironically, there is no reason for all this nudging and threatening. Corporations should be leaping at the chance to place women on their boards of directors and in their executive suites.

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As Catalyst Canada, an advocacy organization “dedicated to accelerating progress for women through workplace inclusion in Canada,” points out: Companies with three or more women directors in at least four of five years significantly outperformed those with sustained low representation by an astonishing 84 per cent on return on sales, 60 per cent on return on invested capital and 46 per cent on return on equity.

Nor is there a shortage of accomplished women to choose from, as Prime Minister Justin Trudeau so ably proved when he named his gender-parity cabinet.

Trudeau’s government should welcome the stronger directives being recommended by some senators and give Bill C-25 a bit more bite. If that doesn’t work, then there are examples of quota-setting from Europe ripe for study.

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