Thought Capital

Shareholder proposal activity reached a six-year high in 2026, driven largely by a significant increase in governance-related proposals, though overall shareholder support declined year-over-year. Our latest analysis explores the key trends shaping the 2026 proxy season, including the growing focus on retail shareholder participation and board oversight of artificial intelligence.

Say-on-Pay support continued to improve in 2026, with both TSX and TSX 60 companies seeing modest increases in average support and a growing proportion of companies receiving over 90% shareholder approval. Our latest analysis examines key voting trends, notable year-over-year changes in support, and the evolving influence of proxy advisors, including upcoming changes to Glass Lewis' voting framework.

Boards today are asking more of management than ever before. In an environment shaped by disruption, artificial intelligence, capital volatility, geopolitical uncertainty, and heightened stakeholder expectations, management teams are increasingly expected to pivot quickly, reallocate resources decisively, and move away from strategies that are no longer aligned with long-term value creation.
 

Hugessen has completed its annual review of the 2026 TSX60 proxy circulars, and we are pleased to share key findings on executive pay, incentive design, board effectiveness and other governance topics.

This year's proxy season tells a clear story of Canadian resilience. With strong financial performance in the midst of trade disruption, and heightened governance excellence in a shifting landscape of proxy advisory and shareholder expectations, Canada's largest businesses continue to lead the narrative on the evolution of executive compensation trends in the North.

Termination provisions may read like fine print, but when an executive transition occurs they become one of the most consequential elements of the compensation framework. They determine cost, influence behaviour, and shape perceptions at precisely the moment when scrutiny is highest. These terms have lasting implications, so getting them right the first time is paramount.

Institutional Shareholders Services (“ISS”) and Glass Lewis have updated their voting guidelines for 2026. The updated guidelines from ISS will apply to shareholder meetings for publicly traded companies on or after February 1, 2026, while those from Glass Lewis apply to meetings held on or after January 1, 2026.

As 2025 unfolded, Boards faced a complex environment driven by AI’s rapid evolution, geopolitical shifts, and tariff uncertainty. In response, priorities around talent management, incentives, and Board effectiveness remained paramount. Hugessen’s 2025 Director Pulse Survey captures Boardroom sentiment and delivers timely insights for 2026.

Over the past year, Canadian boards moved with intent. Across the TSX Composite, the TSX Boards saw faster refresh, fuller self-assessment disclosure, shifting diversity reporting, and clearer skills matrices. Boards are getting sharper about fit-for-purpose skills, more candid about performance, and more explicit about how they evolve. The result: governance that reads less like a checklist and more like a strategy.

As of November 6, 2025, 72 shareholder proposals have been voted on at Canadian issuers, including 58 at TSX60 companies. Of these, 42% addressed Governance, 31% Environmental, 25% Social, and 3% Compensation matters. No operational proposals were submitted in 2025.

Tesla’s board proposed a $1 trillion incentive for Elon Musk, arguing his leadership is essential for the company’s future. This article urges Canadian boards to balance bold executive pay with governance, cautioning that shareholder value alone shouldn’t justify extreme compensation. It highlights the need for rigorous processes and proportionality in designing CEO incentives.