If my criteria for getting up in the morning was to learn one new thing every day, I could go back to bed now.  An article in this morning’s Globe and Mail totally floored me!

It’s perfectly legal (and seemingly normal) for Canadian corporations to go out and buy the votes they require to get past a contentious shareholder issue.  This issue was brought to light in the context of Agrium’s (TSX:AGU,NYSE:AGU) current proxy battle with hedge fund Jana Partners.

The story is, Jana wants to replace Agrium’s board.  Agrium’s board doesn’t want to be replaced.  Jana has the support of ISS, a respected proxy advisory firm, which is recommending that shareholders vote to replace the board.  Agrium’s board has decided to buy votes.

The payment is actually made from the company to retail brokers.  Agrium will pay $0.25 per share to brokers whose clients vote for the Agrium slate of directors.  Brokers can earn a minimum of $100 and a maximum of $1,500 for each of their clients who vote for the Agrium cast.  Jana has indicated they will not resort to such measures.

Sure, the company is not directly paying shareholders to vote for them, but I’m pretty sure my four-year old could recognize the ridiculousness of expecting a broker to offer a fair assessment of this situation to their retail clients given the available bounty.  In fact, when asked, she did indeed say “that sounds ridiculous”!

Even if you knew nothing else about the spat between Agrium and Jana, this spins the Agrium board in a negative light as far as I’m concerned.

The article fingered several other Canadian firms for taking similar measures.  Telus (TSX:T) and EnerCare (TSX:ECI) paid $0.10 and $0.05 respectively to get voters onside with critical decisions and TMX Group (TSE:X) spent $0.15 per share when it was looking to merge with the London Stock Exchange.  Agrium’s offer however blows these out of the water.

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Fool contributor Iain Butler does not own shares in any of the companies mentioned in this report at this time.  The Motley Fool has no positions in the stocks mentioned above.