Economy And Political Stability Have Canadian Directors Concerned
The latest Institute of Corporate Directors’ Director Lens survey conducted by Environics Research shows that board directors have declining confidence in Canada’s economy and political stability, but see governance and inclusion as competitive economic advantages for the country.
Among the results, the survey shows that:
- Of those surveyed, only 28% believe the economy will improve in the next 2-5 years – a significant decline from last year’s findings of 52%
- Only 29% believe that the global economy will improve in the next 2-5 years, compared to 43% a year ago
- Forty percent believe that the global economy will worsen in the next 2-5 years
- Forty-five percent expressed concern over Canada’s domestic political stability over the next 2-5 years, believing it will worsen over that time period, compared to 25% a year ago
Of those surveyed, only 28% believe the economy will improve in the next 2-5 years
Read the survey here.
“Directors are concerned about both the Canadian and the global economic environments,” said Rahul Bhardwaj, President and CEO of the ICD. “Persisting trade uncertainty and protectionism, unpredictable political decisions driven by nationalism and populism, as well as new provincial governments in certain parts of the country, are just some of the factors driving this lack of confidence.”
Directors see Canada’s inclusiveness and tolerance, as well as governance, as key competitive advantages; more work needs to be done on Canada’s business climate
The ICD survey also shows that 76 percent of directors view Canada’s inclusive and tolerant society as a key driver of our ability to compete on the international stage. Further, 71 percent feel that Canada’s governance makes us more globally competitive. Respondents identified perceived weaknesses that serve as a drag on Canada’s competitiveness, including business taxation, R&D innovation and regulatory enforcement.
“It is clear that directors recognize that Canada has some core assets such as inclusiveness, tolerance and good governance. These important cultural qualities help us attract the best and the brightest, and will drive the knowledge economy going forward,” said Bhardwaj. “While recent initiatives to address capital investment should be helpful, it’s also critical for our future prosperity that we leverage our cultural strengths and continue focusing on Canada’s business climate.”
Some – not all – human capital issues are on the radar for directors
The results also show that directors are mindful of some of the issues impacting the well-being and productivity of those who work at their firms. For example, 71 percent have either developed or discussed developing a strategy to address workplace health and wellness, including mental health. By contrast, issues related to the legalization of cannabis (47%), an aging population and its impact on the workplace (48%), and rising income inequality (31%) are less likely to be discussed as strategic issues.
“While directors have yet to address certain human capital matters that will demand greater attention moving forward, they are recognizing the importance of developing strategies that support the wellness of their employees,” said Bhardwaj. “This is crucial to supporting a positive corporate culture, creating a high-performing workforce, and ultimately, strengthening the Canadian economy.”
About the survey
This survey was conducted by Environics Research with 604 board directors between September 15 and October 19, 2018, yielding a response rate of 4.7 percent overall. A sample of this size produces results that can be considered accurate to within +/4.0 percentage points, 19 times out of 20.
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