Canadian securities regulators have decided not to push ahead with planned corporate governance reforms out of concern that companies would be too busy to comply with any new rules.

The Canadian Securities Administrators, an umbrella body for province-level regulators, set out plans to improve governance at the country’s listed companies last December.

But a hostile reaction from many of the companies that would be affected has convinced it that “now is not an appropriate time to introduce significant changes to Canada’s corporate governance regime,” it said.

Companies had complained to the CSA that they were focused on dealing with the financial crisis and the transition to International Financial Reporting Standards; more change would have been too much.

The CSA’s proposed changes would have replaced guidance in several areas with nine broad principles. These covered issues such as board structure, audit committees, director recruitment, engagement with shareholders, and the need to create an internal framework for oversight and accountability. It would also have replaced Canada's "comply or explain" governance reporting with more general disclosure requirements.

It is not clear yet whether the plans are on hold until the timing is better, or have been scrapped. CSA Chair Jean St-Gelais said, "We are reconsidering whether to recommend any changes to the corporate governance regime."

The body promised that any further proposals would be published for comment and that companies would be given plenty of warning so that they could adapt their corporate governance practices in time.

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