The next stage of CSR for Canada: Transformational corporate governance, hybrid legal structures, and the growth of social enterprise

The period when corporate social responsibility ("CSR") only referred to corporate philanthropic donations has passed. Contemporary CSR is intimately intertwined with sustainable development, and its growth in the last several decades has been evident in Canada. The recent appearance of "hybrid" corporate legal structures on the international stage marks a growing trend toward enabling the dual pursuit of economic and social mandates for businesses. This suggests that the next significant stage in the CSR movement will be in the reformation and creation of corporate legal models that not only enable, but require, CSR concepts to be embodied within corporate governance practices. This article borrows the term "transformational" from the business sector to help identify a tangible goal for corporate governance reform in Canada. Highlights include having a sustainable purpose, long term vision, and multi-stakeholder collaboration. While the US shareholder primacy model is often presumed to be the model that is dominant in modern Canadian corporations, this presumption is flawed. This article identifies some of the fundamental legal features that set Canada apart from US shareholder primacy, and attempts to demarcate a path for Canada to attain transformational corporate governance through its laws. Canada is poised to become a leader in corporate governance reform on two fronts: (1) the reformation of its existing laws regulating mainstream corporate governance practices, and (2) the creation of hybrid laws that can meet growing demands to legally house and govern social enterprises.