Canadian business leaders support ‘stakeholder capitalism’, but implementing its principles remains a daunting challenge
TORONTO, September 26, 2022 /CNW/ – A majority of Canadian business leaders agree with the principles of “stakeholder capitalism,” the view that corporations exist not just to benefit shareholders, but also have duties to their other stakeholders – employees, customers, suppliers, environment and the communities where they operate. That’s the key finding of a groundbreaking survey released today by the Canadian Center for Social Purposes (CCPC), a research initiative of Navigator.
About 500 senior executives and 3,000 Canadians, 40% of whom hold shares in Canadian public companies, were interviewed by polling firm Discover for this “purpose index” survey.
Among business leaders, 63% agree that the purpose of a business should be to benefit all of its stakeholders, and 59% believe that when a business considers the interests of all its stakeholders, it ensures its profitability and long-term sustainability. 61% believe a business should have its customers as its main priority, and 58% agree that it’s important for a business to have a strong purpose, but even more important that that purpose be genuine.
However, while Canadian business leaders subscribe to the main principles of reasoned capitalism, they are less enthusiastic about some of the concrete measures proposed to implement these principles. For example, only 46% of them agree that a company should report annually on its ESG performance “as rigorously as its financial performance”, 42% believe that a company should have the environment as a main priority, and 37% believe that a company should take a stand in social and political debates if such involvement is demanded by its stakeholders.
“Canadian senior executives seem to be ambivalent about the social vocation of companies,” comments André Pratte, Executive Chairman of the SPCC. Many of them understand that the old vision of for-profit companies is outdated, but they are unsure of the new model that should replace it.”
Surprisingly, Canadians in general are less enthusiastic about stakeholder capitalism than business leaders. For the first time, CCPC and Discover have calculated a “Purpose Index” (PI), based on the level of agreement with 20 statements describing purposeful capitalism and corporations. CEOs score a relatively low PI of 48.1%, while Canadians who are shareholders score 45.7% and Canadians who own no shares score just 42%.
“This study challenges several assumptions about the depth of commitment to the purpose of the company,” said Dr. André Turcotte, research director of Discover. It is unique because we examine the rationale from the perspective of Canadians, individual shareholders and business leaders. Additionally, we’ve built the survey so we can replicate it over time or for any business interested in knowing how it’s perceived.”
The full report is available at https://navltd.com/insights/ccpc/purpose-index-2022/.
SOURCE Canadian Center for Society Purposes
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