By Esther S.J. Oh

On May 30, 2024, the Federal Nonprofit Data Coalition (the “Coalition”) published an open letter (the “Letter”) to all Senators, Members of Parliament and Ministers concerning Bill S-279, An Act to amend the Income Tax Act (data on registered charities). If passed, Bill S-279 would address an important gap in data by requiring the disclosure and reporting of data about the demographic composition of the directors and officers of registered charities as discussed in the February 2024 Charity and Not-for-Profit Law Update.

The Coalition is composed of over a dozen organizations in the charitable and non-profit sector. A news release from Imagine Canada (a members of the Coalition) describes the mandate of the Coalition as focusing “on advancing the nonprofit sector's priorities in terms of data collected and shared by the federal government.”. The Letter begins by recognizing that nonprofits are integral to Canadian communities, enhancing quality of life and providing indispensable services to support governments as they delivery public policy priorities, particularly in underserved communities. The Letter indicates despite this important role, the nonprofit sector has had a longstanding deficit of data, which is essential for effective policy design and decision-making, and that this data crucial for informed decision-making by governments, funders, researchers, and the nonprofits themselves.

In discussing the origins of the bill, the Letter notes that Senator Ratna Omidvar introduced Bill S-279 to amend the Income Tax Act, to address a key data gap by requiring the provision of data about the demographic composition of boards of registered charities in accordance with recommendation #8 from the Catalyst for Change report by the Special Senate Committee on the Charitable Sector in 2019.

In this regard, recent survey data indicates there is generally a lack of diversity on nonprofit boards, which raises concerns given the leadership and governance roles held by nonprofit board of directors.  Data from a one-time survey is inadequate for tracking long-term diversity trends. Bill S-279 would require organizations to report board composition in their annual T3010 information returns, enabling the nonprofit sector to track aggregate trends n board diversity over time. This would align with existing reporting requirements for federally incorporated public corporations and federal initiatives promoting diversity in corporate Canada.

While the Coalition supports the bill’s intent and stated goals, the Letter states that the organization opposes penalties for non-compliance that would risk charities losing their status for failing to provide this information. The Letter concludes with an intention to propose this and possibly other changes to the bill, as it progresses through the legislative process.

​Read the June 2024 Charity & NFP Law Update