Item - 2018.EX30.17

The Executive Committee recommends that:

1.  City Council amend the Code of Conduct for Members of Local Boards (Restricted Definition) to reflect the changes described in Appendix A to the report (January 10, 2018) from the Integrity Commissioner.

2.  City Council amend the Code of Conduct for Members of Adjudicative Boards to reflect the changes described in Appendix B to the report (January 10, 2018) from the Integrity Commissioner.

When it established the Toronto Investment Board (the "Investment Board"), City Council requested that the Integrity Commissioner review the Code of Conduct for Members of Local Boards (Restricted Definition) to recommend any amendments to reflect the fiduciary duties of the Investment Board.  More recently, City Council also requested that the Integrity Commissioner carry out a similar review relating to the Toronto Realty Agency Board (the "Realty Agency Board").

As a result of these reviews, the Integrity Commissioner recommends changes to strengthen and clarify the Code of Conduct for all local boards, including the Investment Board and the Realty Board.  The changes recommended to the Code of Conduct for Members of Local Boards (Restricted Definition) are indicated in Appendix A to this Report. 

Adjudicative boards are a sub-set of local boards (restricted definition), and are bound by a unique, but similar, code of conduct.  The recommended changes to the Code of Conduct for Members of Local Boards (Restricted Definition) must also be made to the Code of Conduct for Members of Adjudicative Boards.  Accordingly, the changes recommended to the Code of Conduct for Members of Adjudicative Boards are indicated in Appendix B to this Report. 

The Commissioner has additionally written to the Investment Board recommending that it follow best practice for similar boards and establish an appropriate personal trading policy, to further strengthen the duties its board members have not to disclose or use confidential information for private gain.  Personal trading policies range in complexity depending on a number of factors, including the nature and timing of information available to affected people, the nature of the investments or acquisitions made, the terms between third party managers and the board, and the type of investments and transactions over which affected people have influence.

The Investment Board is at the development stage of its mandate, and accordingly this is an opportune time to design a personal trading policy that accurately accounts for its business model and the manner in which it oversees the City of Toronto's investments.  A copy of the Commissioner's letter to the Investment Board is attached as Appendix C to this Report.

The Realty Agency Board is also at the development stage of its mandate.  Different considerations apply given the nature of its mandate; however, it is clear that the Realty Agency Board will have access to commercially sensitive information.  Accordingly, the Commissioner has recommended that the Realty Agency Board consider developing appropriate policies to enhance the confidentiality obligations owed by members of its Board.  A copy of the Commissioner's letter to the Realty Agency Board is attached as Appendix D to this Report. 

As indicated in the letters to the Investment Board and the Realty Agency Board, the Integrity Commissioner will meet with each board to provide more detailed information about what is expected, and will remain available to consult with and provide necessary expertise in support of the development of appropriate policies.