Canadian governance expert bemoans shareholder influence

One of Canada's leading authorities on corporate governance has claimed shareholders are beginning to exert a disruptive influence over major organisations.

Recent debates on governance in the US and UK have focused on encouraging major shareholders to take more responsibility for the stewardship of the companies in which they invest.

However, Peter Dey believes the balance of power is beginning to shift too far away from the boardroom, CTV reports.

Mr Dey was responsible for creating the first governance guidelines for Canadian firms and received a lifetime achievement award from the International Corporate Governance Network (ICGN) this week.

Speaking about the growing influence wielded by shareholders, he told the website: "To try to jump in and make judgments where the board should be making judgments, I think is just the wrong direction."

"Where [shareholders] can be most effective is identifying good directors, getting them on the slate and electing them."

He also suggested the recent trend for investors to have a "say on pay" could set a dangerous precedent for shareholders controlling other aspects of business strategy.

The ICGN's annual conference concludes in Toronto today (June 9th).