Canadians Want Capitalism Reformed and Demand that Businesses Step Up on Fairness and Sustainability

Half of Canadians see issues of fairness—related to wealth inequality and inequitable treatment—as the biggest challenge facing our world today, according to a new research report by the Canadian Centre for the Purpose of the Corporation (CCPC) in partnership with Navigator.

Issues of fairness and sustainability top of mind for Canadians

Wealth inequality and inequitable treatment/discrimination ranked first and third, respectively, in terms of which issues Canadians most often chose as the most significant challenge facing the world. These two issues were collectively mentioned by half of respondents. Environmental/climate challenges occupied the second position and were referenced by 25% of respondents.

These findings are particularly striking considering that the economy and health care have usually been top of mind issues for Canadians. It is highly significant that issues related to fairness came out so strongly in this survey of Canadians’ opinions.

“What is even more remarkable about this finding is that in the midst of a global pandemic and with much uncertainty facing the world economy, Canadians are largely focused on inequality, inequity, and the environment rather than solely concerned about health care or the economy,” said CCPC CEO Brian Gallant.

Canadians recognize the vital role of businesses in the economy but demand they do more to address top challenges

Businesses and corporations are definitely seen to be important contributors to the economy – which is the fourth most frequently named challenge. They are not seen, however; to be contributing enough to address the three most frequently named challenges of wealth inequality, environment/climate change, and inequitable treatment/discrimination.

The overwhelming majority (81%) of Canadians recognize that business and corporations play a vital role in the economy by creating jobs, fostering innovation and providing essential goods and services. With that said, the majority of Canadians (55%) believe capitalism should be reformed so that it is more inclusive, fairer and more sustainable. Less than half (48%) indicate that business is “a force of good within society.”

Immense pressure on businesses to do more for society and stakeholders

There is pressure stemming from Canadians’ expectations that businesses step up and do more for society and stakeholders.

Although the majority (62%) of Canadians agree that if corporations in Canada do better, Canadians do better, more than three-quarters (78%) think Canadian businesses should contribute more to the betterment of society.

“The significant pressure on businesses to do more for the betterment of society creates a delicate situation for them as they still need to generate profits, outperform quarterly targets, and create value for shareholders,” remarked CCPC Vice President and Director of Research, André Pratte. “Nevertheless the pressure is very real, and it cannot be ignored.”

When asked about the purpose of the corporation, 84% of respondents prefer the “stakeholder model”, whereby businesses take into account the interests of all stakeholders (e.g. communities in which they operate, their employees, their retirees, consumers, governments) on par with those of shareholders. Only 16% of Canadians agreed with the traditional “shareholder model” of business, where firms’ only concern is the satisfaction of their shareholders.

Less than half (39%) of Canadians assess that businesses are heeding the call to adhere to the stakeholder approach and two-thirds (65%) of Canadians believe Canadian businesses and corporations prioritize profits for their shareholders over the well-being of their stakeholders.

There are potential rewards for businesses ‘stepping up’, and serious risks if they don’t

The research suggests that businesses doing more for stakeholders will be rewarded by their employees and prospective employees. The majority of Canadians (56%) state they are personally willing to accept a lower salary to work for a business which espouses the “stakeholder model”.

Conversely, if businesses do not step up, they collectively face the risk that change will be thrust upon them. In fact, a significant majority (65%) of Canadians are calling on government to force businesses and corporations to put environmental and stakeholder considerations on par with profits or shareholder return while making decisions. Two-thirds of Canadians agree that if we’re going to overcome climate change (69%) and inequalities (66%), governments in Canada need to get tougher with Canadian businesses and corporations through laws, regulations, and taxes.

“There is a dominant view among Canadians that the economic system must be reformed to be more inclusive, fairer, and more sustainable,” added CCPC Vice President Tasha Kheiriddin. “A majority also want governments to force businesses to address these issues, through additional regulation and taxes. To avoid this result, firms should consider proactively taking steps to tackle social challenges.”

This survey is the first report published by the Canadian Centre for the Purpose of the Corporation in partnership with Navigator. Other research focused on deepening businesses’ understanding of the new pressures they face will follow during the fall and winter.

About the Research

The survey was conducted among a national proportional sample of 3,000 Canadians, age 16 or older.

The study was conducted using an online methodology and was fielded from July 6 to 11, 2020. Respondents were able to complete the survey in the language of their choice: English or French.

Quotas were instituted for region, age and gender to ensure the sample reflects the characteristics of the Canadian population based on recent Statistics Canada data. Further, weights were applied to ensure the educational level of respondents reflects Statistics Canada data.

Statistical margins of error are not applicable to online polls. However, The margin of error for a strict probability sample for a sample of this size would be ±1.8%, 19 times out of 20. All survey samples and polls may be subject to multiple sources of error, including, but not limited to, sampling error, coverage error and measurement error. Responses may not add up to 100% due to rounding.

About the Canadian Centre for the Purpose of the Corporation

The Canadian Centre for the Purpose of the Corporation is a ground-breaking initiative of Navigator, Canada’s leading high-stakes public strategy and communications firm. The Centre’s team of experts in policy, governance, business, communications, law, and social responsibility help equip Canadian businesses and organizations with insights, tools, and support as they work to redefine and strengthen both the scope of their purpose and the contributions they make more broadly to society.

Building on the findings of its first proprietary research study, the Centre will release regular analysis and guidance for business based around the expectations of Canadians. It will use these insights to design tailor-made strategic solutions for businesses and organizations to define, advance, and implement their purpose.

More information about the Canadian Centre for the Purpose of the Corporation can be found on its website or on LinkedIn.

Aussi disponible en français.

For further information or to request an interview: Michael Stock, Consultant, mstock@navltd.com.