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Business leaders should proceed with caution on public debates

Business leaders in the C-suite who think they should be speaking out on important issues should proceed with extreme caution. Based on our public opinion research, it appears Canadians aren’t sure what they want to hear.

To be clear, we live in a democracy, and everyone is entitled to offer opinions. The voice of the private sector can bring many valuable perspectives to discussions, but wise leaders will be wary of the potential pitfalls.

There is a distinct story in Canada about who the trusted voices are on matters such as diversity, inclusion, other aspects of social equity, or issues such as climate change. Context and national values are very important to trust, and it would be a mistake to assume Canada is the same as the United States or other democracies. Trust Canada to be different.

CEO advocacy is viewed by some as a natural extension of Corporate Social Responsibility (CSR) efforts in an organization. In some governance circles, boards are expected to consider many stakeholders beyond shareholders. A report published in 2022 by the Institute of Corporate Directors of Canada states that boards must recruit a new kind of CEO “to deliver results to relevant stakeholders.”

While taking public positions can connect to reputation and trust, it also brings definite risks.

For the distinct Canadian context, it is important to know that trust in business is generally lower than trust in other institutions. This is particularly true for large corporations, which are trusted by barely one-fifth of all Canadians. Corporations are not on higher ground than government or NGOs.

Our newest research reveals a complex and contradictory playing field among Canadian audiences. Corporate leaders can take positions, but finding win-win scenarios will be harder than expected.

In our January 2024 survey, we asked Canadians if CEOs should speak out on “important issues such as climate change, racism and social equity” regularly, in rare instances or not at all. Approximately half of those sampled said CEOs should speak out in rare instances, or never. The other half, at 49 per cent, said regularly, down from 57 per cent in 2022. This year’s decline in support for speaking out regularly occurred in all age groups.

We also find varying expectations for CEOs when we examine different topics. Not surprisingly, three-quarters of Canadians support CEOs opining on economic growth and prosperity, while only a third want to hear from business leaders on international conflicts. These preferences are timely and important to know in the context of today’s global tensions.

Interestingly, when compared to the free enterprise economy of our southern neighbour, fewer Americans, at 41 per cent, think business leaders should take positions regularly. When we consider how many business executives do speak out in the United States, it is a fair question to ask if they considered whether people wanted to hear from them.

Canadians and Americans also have different on specific topics. When asked if they think business leaders should occasionally take a stance on climate change, 66 per cent of Canadians said yes compared to 55 per cent of Americans. Additionally, 61 per cent of Canadians would be open to hearing from business on healthcare issues, compared to 49 per cent of Americans. This makes speaking out even more complicated for CEOs who oversee companies operating on both sides of the border.

In Canada, it is important for organizations to know there are differences by age group. Among Gen Z, fully 61 per cent want CEOs to speak out regularly, compared to just 48 per cent of boomers. Understanding audiences is crucial.

The question of speaking out on issues becomes even thornier when we ask Canadians to choose which audience CEOs should consult most when deciding how, or if, to speak out for positive social change. In a striking lack of consensus, 44 per cent chose the general public, 25 per cent chose customers, 14 per cent chose employees and only eight per cent chose shareholders. Nine per cent did not know.

These results highlight the quagmire of speaking out. Fewer than half of Canadians want it to happen regularly and there is no consensus on which audiences to consider or which topics to address. For a corporate CEO, shareholders and employees would be logical audiences to start, but they are lowest on the list for Canadians. We have a major breakdown in expectations between how corporate leaders operate and what the public expects.

So here is our advice to business leaders: proceed carefully. Identify the audiences and topics that matter most to your organization’s success and the community’s well being. If contemplating a public position, listen carefully and consider your full spectrum of stakeholders and their opinions.

Consider your own credibility, as well. Walk the talk and lead by example. We live in a highly transparent world and people are watching. If you advocate externally but don’t deliver internally, no one will trust you. Thoughtful CEOs may want to choose issues that connect to their own business, such as a publisher speaking out against banning books.

Live by your values and make sure they are known. When decisions and policies are linked to values, people are more likely to understand and trust, even if they disagree with a particular decision. In our nine years of research, “having values similar to my own” is consistently identified by Canadians as a top driver of their trust in brands and organizations.

What does all this mean? On the positive side, if a corporate leader has views to share on the economy and prosperity, they are on safe ground. If a company is announcing positive investments and job creation, they will be received warmly.

On the other hand, moving outside this zone of expertise will be complicated and risky. Values are shifting in Canada from older generations to younger, with different expectations accordingly. CEOs should not abandon the stage. Only with listening, analysis and preparation can they understand the benefits and risks and speak with a positive impact.

Bruce MacLellan is the chair of Proof Strategies Inc.