The decline in public markets has been used to justify any number of deregulatory initiatives in recent years, from diluting securities regulators’ investor protection mandate to scrapping proposals for climate and board diversity disclosure.
Now, however, the Supreme Court is being invited to reverse course by embracing the approach taken by a lower court judge in Markowich v. Lundin Mining Corporation, who seemed to think timely disclosure of bad news is only necessary when there is aWe require timely disclosure of information when it’s not only relevant to investors but also highly costly for them to discover without help from management.
But the obligation to disclose material changes long predates this trend – in Ontario, it was enacted in 1978. And while investors only gained the power to sue for failures to meet this obligation in the 2000s , this regime came with caps on liability and other guardrails meant to placate corporate Canada’s concerns about frivolous lawsuits.