company because of variations in the number of options granted by each company from year to year.

The best types of options are perhaps those which have performance criteria attached in addition to time vesting. The performance criteria can relate to such things as specified increases in stock value above the grant price before the options vest or underlying business performance. Strange as it may seem, under U.S. accounting rules if performance criteria are attached to the options the cost generally has to go through the P & L. Unfortunately, as a result, in the U.S. there is a strong incentive not to have performance options.

Incidentally, in the U.S., the amount that options are in the money when they are exercised becomes a deductible expense of the corporation for U.S. tax purposes.

I note your comments that refer to non-employee directors receiving options. Again, as indicated in the Dey report, if the options are valued and taken into account as part of the total compensation of directors, I see no particular downside. In this context I can understand why Fairvest and others would want to limit the number of options that can be granted to directors but it is somewhat illogical to do so when there is no limit on the other types of compensation that directors can receive. If aggregate compensation of the directors is too high the shareholders can object. I remind you that directors set all of their remuneration and not just the part that may relate to options. Incidentally I see very little evidence in Canada that directors are overpaid. Quite the contrary, they may be underpaid.

With a mandate to aid and educate pension plan beneficiaries, the newly formed Shareholder Association for Research and Education (“SHARE”) will work with union and other pension funds in Canada on share ownership issues. SHARE has a four-point mandate:

Through its activities, SHARE aims to help workers who have been appointed to oversee pension funds raise their knowledge and understanding of the trustee role, since many who serve are “shop floor” workers who have little relevant background. Other objectives include the development of social and environmental investment policies that would aid in the selection of holdings and

voting of proxies on social issues. SHARE intends to push for heightened accountability on voting of proxies for fund holdings with the ultimate goal being the adoption in Canada of regulation similar to that in the US under the Employee Retirement Income Security Act (“ERISA”) that mandates proxy voting by fiduciaries.
The organization, officially launched on November 29th, 2000, is backed by Working Enterprises Ltd. and the British Columbia labour movement, in particular, the BC Federation of Labour and nine large unions.
Heading up SHARE are Peter Chapman, Executive Director, Gil Yaron, Director of Research, Law and Policy and Ken Georgetti, Chairperson. Peter Chapman most recently worked with the Taskforce on the Churches and Corporate Responsibility (Talisman and its operations in Sudan) and was coordinator of the Canadian Friends Service Committee (a service arm of the Quakers in Canada). Gil Yaron is a lawyer with a background in corporate law. Ken Georgetti is president of the Canadian Labour Congress.