This translation has been automatically generated and has not been verified for accuracy.When COVID-19 started sweeping across Canada, Cenovus Energy Inc. had to think fast to protect the company from the pandemic and a simultaneous oil price war between Saudi Arabia and Russia.
Businesses will have to balance satisfying shareholders, who will never say no to more cash, with keeping their companies afloat as they grapple with mass layoffs, forced closures of their brick-and-mortar locations, transitioning staff to work from home and in some cases, the erosion of their entire industry.
A new consideration was added to their deliberations in 2019, when Leblanc said the Canadian Business Corporations Act was changed to demand business leaders act with “the long-term interests” of a corporation in mind.“It would be very difficult to argue that when tough decisions have to be made about laying off workers and supply chains that dividends should not be ,” Leblanc said.
Leblanc thinks companies in the oil and gas, aviation, hospitality, and entertainment industries are most likely to have to cut or suspend dividends.
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