Category: Perspectives

IT IS BUDGET SEASON in Ottawa and the town is rife with speculation on the timing of the next federal election and how the government’s commitment to build back better will take shape. Predicting when Canadians will next go to the polls is a favourite pastime in the salons of our nation’s capital. Between now and Budget Day on April 19, we can expect a daily dose of deep analyses of leaders’ statements, the impact of possible budget measures on public opinion, and what it might all mean for the electoral outcome in West Nova, Shefford, or Aurora-Oak Ridges-Richmond Hill.

“If the pandemic has reminded us of the importance of a strong public sector, it has also shown that governments acting alone will not get the job done.”

Setting aside the horse race for a moment, it is worth considering how this year’s budget season differs from years past. The COVID-19 pandemic has exposed profound flaws in the delivery of essential health and social services. Entire industries have been brought to their knees. And governments everywhere have had to acknowledge that conventional policy responses simply are not sufficient to meet the challenges we face. If the pandemic has reminded us of the importance of a strong public sector, it has also shown that governments acting alone will not get the job done. Canada needs nothing less than a whole-of-society approach to rebuilding our economy and rethinking public policies.

At least rhetorically, the federal government seems to have embraced the opportunity for wholesale changes in a number of policy areas. Building back better has given it licence to consider new approaches to energy and climate change issues, income and employment supports, and infrastructure.  But completing those transitions will require strong partnerships with businesses that also embrace the opportunity for transformation.

In fact, the government has already begun to lay out their expectations. Over the last year alone, they created a new 50-30 challenge to increase diverse representation in corporate Canada, set in motion a new public-private Sustainable Finance Action Council to help scale sustainable finance in Canada, and directed the Canada Infrastructure Bank to work with the private sector to expand rural broadband and invest in clean power generation. The key question will be whether the government succeeds in finding those partners.

Throughout the pandemic, countless Canadian businesses have proven they are up to the challenge.  They have adapted to the realities of the pandemic and developed new products, delivered new services and organized themselves in new ways. But too often, those businesses are being let down by policy advocates whose asks of the government fail to reflect the undeniable fact that the world has fundamentally changed in the last twelve months. Many of their budget demands in 2021 sound like the productivity and competitiveness agenda of the early 2000s or the innovation agenda of the early 2010s dressed up in COVID-19 clothing.

Fortunately, a growing number of Canadian business leaders understand the shift that is required of them. They know that looking beyond quarterly reporting toward a purpose-driven approach to running their business is table stakes to partnering with government in this post-pandemic world. They come to the discussion with a willingness to adapt and with skin in the game. They are concerned with their business’s contributions to the well-being of all their stakeholder groups, and they value equity, diversity and inclusion as guiding principles to drive their development. Equally importantly, they know that this government has the political will to usher in broad, systemic changes impacting various sectors. Those who do not commit to change may have change imposed on them.

Former Prime Minister Joe Clark often reminded his advisers that, when engaging in policy debates, one had to choose between making a point and making a difference. Making a point allows an intervener to focus exclusively on the needs of their business or their sector, undiluted by external considerations. The ask is straightforward, but it leaves the intervener on the outside looking in. Success is possible, but the intervener has less agency in shaping the decision.

Making a difference, on the other hand, requires of the intervener that they articulate their contribution to solving the policy problem, not just the benefit they are seeking. It requires openness and flexibility, and alignment with the public good, not just private gain. It is those interveners who become trusted and influential partners. And it is their efforts that are more likely to be reflected in Minister Freeland’s words on April 19 and government action in the months and years to come.

Whether it comes in the spring or fall, the federal election campaign will be a temporary distraction from the serious, long-term thinking that needs to happen if we are to recover successfully from the pandemic. The real story to watch will be how courageous our public sector leaders will be in changing their approach to public policy challenges, and how creative the private sector will be in responding to the call.

THIS YEAR’S THEME for International Women’s Day is “Choose to Challenge”, a direct appeal to question and confront gender bias and inequality where we see it. It’s a noble call to action but a difficult thing to do in practice — discussions about equity, diversity and inclusion often elicit strong reactions, particularly in corporate settings.

“Making gender equity a priority means being more than just performative — it means challenging the idea that equity means parity alone.”

As a result, corporate Canada has tended to lean heavily on the numbers. Proportionate representation — or parity — between men and women has become the gold standard of gender equity around the boardroom table. Parity is clear. It’s measurable. And frankly, saying you have gender parity is one heck of an issues management strategy.

However, talking about amorphous ideas like culture, acceptance, respect, and inclusion is a lot more challenging. Messy even. But it’s also necessary. Making gender equity a priority means being more than just performative — it means challenging the idea that equity means parity alone.

To be clear, on the parity front Canada is nowhere near perfect. We appear to do relatively well, ranking in the top 20 of the World Economic Forum’s Global Gender Gap Index as one example.¹ However, our efforts to bridge the gender gap remain very much a work in progress. In January, a Globe and Mail investigative series called “The Power Gap” grabbed the attention of Canadian public and private sector companies.² It found that across publicly owned corporations, governments, municipalities, and universities, there were “dramatically” more men in high-paying jobs, on executive teams, and leading organizations.

But this was only part of that story. Another key finding in the series was that women face other challenging barriers to success. Reporter Robyn Doolittle relays the story of a female fundraiser who was punished for speaking up against a male executive who was bullying her. She speaks of a scientist who was refused research funding but was asked to appear in promotional materials for her organization because they wanted to appear “more inclusive”. Doolittle also tells the story of an administrator whose boss revoked a promotion because he was frustrated she was pregnant.

A lack of women in leadership roles may be partly corrected with parity. But the roots of the other barriers are cultural and structural in nature. The people within these institutions committed the acts, but the culture and structures within these institutions allowed them to happen.

That’s the problem with talking about parity alone — it gives institutions an “out”. A company might say it is meeting its obligations because it has equal numbers of men and women in certain positions. But what if these women are being paid less than their male counterparts?  What if they are being given less challenging or lucrative projects? Or they are being sidelined when it’s time to lead the company presentations? Public-facing numbers rarely account for these types of details.

That is exactly why parity policies need to be accompanied by real cultural and structural changes too. Behind the numbers, marketing slogans, and exceptional success stories, are less obvious but equally high barriers that need to be challenged. And that requires organizations to take a long, hard, introspective look at themselves — something that can be awkward, uncomfortable, or even risky to do.

But if organizations did this important work, what kinds of barriers might they find?

There are a litany of possibilities, and every organization will be different, but they might find that their existing human resources structures don’t encourage — or worse, foster fear — of speaking out when inequity is experienced or identified. Higher-ranking employees may be given the benefit of the doubt when concerns are raised. Colleagues may be type casted as “squeaky wheels” for coming forward. Colleagues may bring forward an issue but be told to address it themselves.

With high-intensity workplaces, there may be an expectation that employees stay late at the office, come in on weekends or take limited time off. But this kind of flexibility is usually only an option for those employees who don’t have children, family members with complex needs, or other responsibilities during their off hours. A lack of flexibility – whether in terms of when work is completed during the day, or where this work can be accomplished – can be a very real obstacle for caretakers, a significant number of whom are women.

Like many Canadian institutions, an organization may also find that pay equity is a concern. Statistics Canada reports that women are, on average, earning about 0.89 cents for every dollar a man earns.³ Some cases are more dire than others.⁴ As one example, a recent look into Canada’s largest law practices revealed that female equity partners are earning 25 per cent less — around $200,000 — than their male colleagues. A lack of transparency on salaries and a lack of clarity on performance targets both contribute to the gap. But culture also appears to be a factor — through her work, Robyn Doolittle found numerous studies that revealed that women tend to be judged more negatively when they try to negotiate their own salaries.

An in-depth look at an organization’s workplace culture might also reveal that its leadership has tended to prefer certain characteristics, ways of acting, ways of speaking, or even certain people, over others. The easiest, but by no means only, example is that of an “old boys club” that encourages or even promotes the stereotypical behaviour of one specific group. At best, long-engrained cultural norms like these can make people feel like outsiders. At worst, they can create environments where harassment and bullying can fester unchecked.

These are only four short examples, but you may have noticed that parity isn’t the magic bullet solution to any of the problems identified — cultural and structural changes are. The good thing is that making cultural and structural change — while impacting women and BIPOC individuals most positively — actually benefits everyone. We can all get behind a human resources process that acts when a concern is raised. COVID-19 has proven we can all get behind more flexible work times and spaces. Addressing pay equity ensures a level playing field and embracing a more open culture allows all of us to present our truest selves at the office.

Change requires concerted effort and time, but embracing it can improve an organization’s standing, from staff retention, to morale, to financial performance. None of this work is easy, but it’s worth it. This year, when we think about International Women’s Day, we should commit to change where it matters most and challenge ourselves to start thinking beyond the numbers.

[1] http://www3.weforum.org/docs/WEF_GGGR_2020.pdf[2] https://www.theglobeandmail.com/canada/article-power-gap/[3] https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410034002[4] https://www.theglobeandmail.com/canada/article-female-partners-earn-less-than-male-colleagues-at-big-law-firm/

FOR MANY DECADES, there has been a clarion call for designers around the world to put their methods, design thinking, and strategic foresight, to use in addressing the biggest problems facing our societies. Designers have applied their skills to create products, services and systems that are environmentally sustainable, support economic participation at all levels of society, and are inclusive and respectful of different needs and cultures. Now, as we consider the profound inequities laid bare by COVID-19 and the world we want to build post-pandemic, there is a crucial role for design.

In every facet of our world, the current crisis has revealed these kinds of human needs, from the precarity facing too many of our neighbours to the undervalued contributions of our front-line workers.  In the world of business, organizations are addressing societal issues through a renewed focus on corporate purpose and a greater role in the challenges we all face.  It is time for the public and private sectors to put the power of design to work in addressing these issues with input from and collaboration with the communities that they serve.

“At its best, design focuses on the needs of users and engages them in the process of defining problems and testing solutions. Fundamentally, design is linked to purpose, as both are concerned with the motives for decision-making and its wider effects on communities and individuals.”

Design is the intentional, creative, and technical practice of translating human needs into practical solutions. It is also stakeholder driven and forward thinking, accounting not just for the needs and uses of today, but also those of the future. At its best, design focuses on the needs of users and engages them in the process of defining problems and testing solutions. Fundamentally, design is linked to purpose, as both are concerned with the motives for decision-making and its wider effects on communities and individuals.

For example, designers from Black, Indigenous and racialized communities are bringing their life experience and sensibilities to creating designs that are inclusive and meaningful to businesses, consumers and communities.  OCAD University undertook a Black cluster hire of five additional faculty in 2020 under the leadership of Dean Dori Tunstall, the world’s first Black female design dean, allowing it to more effectively teach and research inclusive design. The university has also built its Indigenous design capacity. During Black History Month this year, the prestigious College Art Association and the Advertising and Design Club of Canada are exploring the contributions and methods of Black designers.

We need not look very far to find examples of design “in action,” being used to address the issues of today. Recently, the leadership of the European Union has embraced the “New European Bauhaus movement,” which is focused on encouraging designers to use their craft in the interests of a more equal, resilient and sustainable Europe post-COVID. This movement intends to combine thoughtful design with sustainability, balance function with beauty, and bring together entrepreneurs and creators to address climate change through large-scale solutions in buildings, transportation and resource-efficient digital innovation.

There are other examples to which we may turn. Movements like the New Bauhaus borrow assumptions from Bruce Mau’s 24 Principles for Designing Massive Change, which emphasize generosity, social inclusion, and environmental awareness. Mau’s work underlines the transformative nature of conscientious design and its potential to improve quality of life and address major challenges.

Aside from these applications, there is no escaping the role that transforming our physical spaces will play in our COVID recovery. We simply cannot allow “business as usual” to dominate our response. “Business as usual” thinking has gotten us where we are today. It will take bold thinking to reconsider the way we prioritize the use of space and how we share it.

When it comes to corporate purpose, design can support organizations as they reorient themselves in a new world — first and foremost through the design thinking process and tool kit. Design thinking brings together a diverse set of stakeholders and sources to ideate solutions. Needs are identified, problems framed and solved. It supports creative brainstorming processes drawing from talent at all levels within an organization, at times from both within and outside, and ideally representing multidisciplinary knowledge and perspectives: exactly the inputs needed for meaningful consideration of purpose.

Using a set of techniques ranging from observation and data gathering, to sketching and brainstorming, participants identify issues and opportunities to create multiple strategies. They establish prototypes that can be tested, eliminated, or enhanced in a rapid process, gathering, and integrating feedback from stakeholders. The goal is one of continuous improvement in a context of constantly changing conditions. Inclusive design and generous design are integrated into the process to ensure needs and voices of diverse individuals and groups are addressed to define needs, questions, goals, and outcomes.

While these approaches clearly apply to technical innovation, they are equally viable to organizational innovation. Design thinking helps groups understand if they are asking the right questions for their context and problem. Design thinking encourages participants to exercise empathy, that is to imagine situations from different points of view. Design thinking can result in solutions that address economic disparities and inequity while opening up access to talent, and new markets.

What’s more, we’ve already seen design thinking employed across the private sector, to great effect. IBM has adopted Design Thinking in a dramatic reworking of its strategy as it pivoted towards service design and delivery of AI driven business systems, a shift that improved return on investments. The Mayo Clinic applies design thinking to understand how patients experience health care, examining the user experience in detail and then placing doctors and designers together to sound out their approach to care, prototype and then launch a revitalized patient-centric care journey.

As we consider the changes to our world and the role for the private sector in it, business and policy leaders must consider the applications of design and design thinking. These applications are made all the more important by COVID-19, when companies and entire sectors face the need for creative strategies that can both manage through the crisis and find opportunities for post-COVID innovation.  Design and its constituent tools can be used to stimulate creativity, innovation, and contextual awareness as our society and our businesses consider the future and their place within it.

AS COVID-19 CONTINUES to pose a threat to Canadians, the various approvals of vaccines in countries around the world offer a glimmer of hope that we will eventually leave this pandemic behind. While we can see a faint light at the end of the COVID-19 tunnel, we are only just beginning to grapple with the other issues 2020 laid to bare, including inequities related to race and income; an increasingly toxic and divided political environment; and, as we saw with the devastating fires in Australia, the rising threat of climate change.

It would be reasonable to assume that Canadians’ concerns regarding climate change have taken a back seat to ones more directly tied to COVID-19, such as healthcare and the economy. However, according to a recent survey by the Canadian Centre for the Purpose of the Corporation (CCPC), Canadians perceive climate change as a greater challenge than both of those issues.

It’s not a challenge that will be solved in legislatures and thinktanks alone. It requires a shift in thinking from big business and institutional investors. We are seeing exactly that.

“Accusing a company of greenwashing, the practice where unsubstantiated claims are made to make an organization appear greener than it is, has become a powerful rhetorical device that has, fairly or not, been leveled against virtually every corporate sustainability effort.”

Canadian equity giant Brookfield Asset Management formed a US$100-billion fund focused on combatting climate change, spearheaded by Former Bank of England and Bank of Canada Governor, Mark Carney. Net inflows into Canadian exchange-traded funds (ETFs) that track companies focused on environmental, social and governance (ESG) factors grew to $740 million, an amount that far exceeds the $142 million invested last year and the $200 million invested in 2018, excluding seed capital. In the United States, $4.2 trillion of assets under management incorporated climate change specific criteria—a 40 per cent increase from 2018 and by far the largest number in absolute terms compared to any other ESG category.

There is no doubt that there has been a substantial shift in corporate mindsets and strategies in favour of sustainable investing. What remains less clear for ESG-conscious investors is how to differentiate between legitimate corporate sustainability efforts and greenwashing.

Accusing a company of greenwashing, the practice where unsubstantiated claims are made to make an organization appear greener than it is, has become a powerful rhetorical device that has, fairly or not, been leveled against virtually every corporate sustainability effort.

When the everyday person thinks about large, multinational corporations and the environment, their key reference points are the most well-known cases where corporations mislead the public about their environmental efforts and standards (think the BP oil spill). As a result, the baseline assumption for many is that any environmental effort touted by a large company is likely a PR stunt and will not have a real impact. For companies with genuine commitments to fighting climate change, overcoming this baseline assumption is a challenge.

“Greenwashing” has held onto its rhetorical power, even as private emission-reduction initiatives significantly improve, in large part due to flaws in the systems that regulate how companies report and enforce their emission-reduction efforts. Lack of transparency, standards and clear enforcement mechanisms in sustainable finance have enabled bad actors to take advantage of the system, further discrediting corporate sustainability efforts.

A clear example of this is the carbon offset market. A carbon offset is a credit for emissions reductions given to one party that can be sold to another party to compensate for its emissions. An offset can take many shapes and forms, such as financing a wind turbine generator or restoring a section of a tropical forest. Major companies such as Amazon, Delta, Disney, and countless others buy carbon offsets to help offset their net emissions. It is estimated that carbon offset projects cover 359 million tons of CO2 a year, more than France’s annual emissions. The carbon offset market is likely to grow even more due to the over 170 companies who have pledged to become carbon neutral by 2050.

Carney and other proponents view carbon offsetting as simple and relatively cost-effective way for individuals, corporations, and governments to offset emissions and believe it’s a critical component of the climate solution. Conversely, critics view purchasing carbon offsets as greenwashing because they, in their minds, provide an easy way for companies to look like they are fighting climate change without actually reducing the emissions they produce.

These criticisms stem in large part from bad actors who have taken advantage of a lack of uniform standards and enforcement mechanisms, making the line between what is a legitimate corporate sustainability effort and greenwashing extremely blurry. Different offset programs have different standards and best practices. This makes them difficult to uphold and opens them up to fraudulent activity and interest rate-style manipulation. For instance, there are multiple cases of businesses in China and other countries who have deliberately increased their greenhouse gas emissions for the sole purpose of getting paid to reduce them.

More common, though, are examples of companies, both knowingly and unknowingly, inflating the level of environmental impact carbon offsets.  GreenTrees, the largest carbon reforestation project in North America, pays landowners to plant trees on their croplands, calculates the carbon absorbed as a result, and then sells credit for the carbon reductions to large corporations. GreenTrees has been accused of taking credit for trees that were already planted or would have been planted anyways. If true, not only would this mean that its emission reductions claimed are inflated, but also those of the corporations who bought credits from GreenTrees. Furthermore, for investors who purchased shares of these companies as part of an ESG investing strategy, the environmental impact of these investments would likely be far less than they believe.

GreenTrees is one of many examples that illustrate how a lack of uniform standards and regulatory oversight hurts the legitimacy of the offsets market. Corporations and investors can somewhat mitigate the risk of purchasing offsets with inflated emission reduction claims by consulting with auditors or standards groups like The Gold Standard or Green-e. However, this alone won’t solve the carbon offset market’s credibility issues.

Regulators, corporate executives and large investors must work together to set universal standards, terms, verification processes and disclosure policies for selling and purchasing carbon credits. Unless proper standards and enforcement mechanisms are established, greenwashing claims will continue to be legitimized and investors and corporations will lose confidence in the effectiveness of carbon offsets, removing a critical tool that has real potential to help corporations and policymakers to meet aggressive climate-change targets.