The purpose of this study is to provide insight into the ongoing debate in the
regulatory and academic communities on the effectiveness of the new governance
regulations in Canada. Since the late 1990s, publicly traded firms in Canada have been
subject to stricter corporate governance rules and guidelines. These changes in
expectations regarding corporate governance were motivated, to a large extent, by
some large corporate scandals in the USA and Canada. Due to the fact that many
Canadian companies also rely on the US capital market, the dramatic changes in the US
corporate governance regulations and practices (e.g. the Sarbanes-Oxley Act and the
new SEC regulations) have also had a significant impact in Canada.