TCI Fund Management Limited, on behalf of itself and as investment manager of long-term shareholders CIFF Capital UK LP and The Children’s Investment Master Fund (TCI Fund Management Limited, CIFF Capital UK LP and The Children’s Investment Master Fund are referred to collectively as “TCI”), today delivered the following letter to the Board of Directors (the “Board”) of Canadian National Railway Company raising serious concerns about its integrity and commitment to proper corporate governance practices.
Specifically, CN failed to disclose the material development that Julie Godin had resigned from the Board on September 16, 2021 in an appropriate and timely manner. The full text of the letter is included below:
Board of Directors
Canadian National Railway Company
935 de La Gauchetière Street West
Montreal
Quebec H3B 2M9, Canada
Attn: Robert Pace, Chairman of the Board
September 29, 2021
Dear Chairman Pace and members of the Board of Directors (the “Board”) of Canadian National Railway Company (“CN” or “Canadian National”).
We believe the Board has been responsible for selective, inconsistent and potentially misleading disclosure of information.
It has come to our attention that Julie Godin, CN’s youngest female director, resigned from the Board on September 16, 2021 – the same day TCI formally requisitioned a special meeting to replace four Board directors, and the day before CN announced its new strategic plan.
Her resignation and CN’s failure to publicly disclose it by way of press release raise serious securities and corporate governance issues:
In summary, the manner in which Julie Godin’s resignation was dealt with, including the failure to inform the market by way of press release in a timely manner, especially in the existing context, raises serious questions about the integrity of the Board and its commitment to good corporate governance.
Furthermore, this conduct is another example in a long list of corporate governance failures at CN and illustrates why urgent change to the Board and leadership is necessary to put CN back on track.
TCI has serious concerns about this failure to disclose and intends to report Canadian National to the relevant Canadian securities regulators and stock exchanges today.
Yours sincerely,
Chris Hohn |
Ben Walker |
Appendix A |
||
Name of New or Departing |
Effective Date of Appointment |
|
Luc Jobin |
June 1, 2009 |
April 29, 2009 |
Luc Jobin |
June 30, 2016 |
June 27, 2016 |
Claude Mongeau |
July 1, 2016 |
June 7, 2016 |
Mike Cory |
July 1, 2016 |
June 27, 2016 |
Ghislain Houle |
July 1, 2016 |
June 27, 2016 |
Jim Vena |
July 1, 2016 |
June 27, 2016 |
Shauneen Bruder |
April 25, 2017 |
April 25, 2017 |
Julie Godin |
April 25, 2017 |
April 25, 2017 |
Luc Jobin |
March 5, 2018 |
March 5, 2018 |
Jean-Jacques Ruest |
July 24, 2018 |
July 24, 2018 |
Margaret A. McKenzie |
October 6, 2020 |
October 6, 2020 |
About TCI Fund Management
Founded in 2003 by Sir Christopher Hohn, TCI Fund Management Limited, the investment manager of CIFF Capital UK LP and The Children’s Investment Master Fund, is a value orientated, fundamental investor which invests globally in strong businesses with sustainable competitive advantages. Using a private equity approach, TCI Fund Management Limited conducts deep fundamental research, constructively engages with management and adopts a long-term investment horizon. For more information on TCI Fund Management Limited and its ESG policy, visit www.tcifund.com/ESG
Disclosures
TCI has been a CN shareholder since 2018. TCI currently owns more than 5% of the shares outstanding (valued at $4.3 billion) and is committed to the long-term success of CN.
Contacts
Kingsdale Advisors:
Ian Robertson
President, Canada
Direct: 416-867-2333
Cell: 647-621-2646
Email: irobertson@kingsdaleadvisors.com
Hyunjoo Kim
Director, Communications, Marketing & Digital Strategy
Direct: 416-867-2357
Cell: 416-899-6463
Email: hkim@kingsdaleadvisors.com
TCI Media Contacts:
ASC Advisors, New York
Steve Bruce: sbruce@ascadvisors.com
Taylor Ingraham: tingraham@ascadvisors.com
203-992-1230