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2019 MAZDA CX-9 BEST LARGE UTILITY VEHICLE IN CANADA FOR 2019 DEPARTMENTS The Perth Citizens’ Band, practising at the 4 Feedback town hall, is the oldest of its kind in Canada. Below: prolific director 5 The Rant Indira Samarasekera Cracking down on corruption isn’t just the right thing to do; it also boosts the economy

11 The Exchange Step into champion home builder Peter Gilgan’s luxury apartment for a martini or two, and he’ll tell you how to tackle housing affordability

14 Panorama Watch out, Dollarama. ents Oomomo, a “100-yen” Japanese retailer, has arrived in Canada, and more chains are following nt AY WR

FEATURES ARDEN S; OM TT

REP 22 Stay tuned for the next 38 Castaways BO AY episode of Kelly Bennett Magna International is shutting down an aluminum casting plant in co Netflix’s B.C.-born chief marketing VUONG; JOHN/D 18 Trichur officer had the world’s best Perth, Ontario, in June, and neither TIE

AND The Trudeau advertising job. So why is he walking management nor workers want

CHRIS government wants banks away at age 47? /By Alec Scott to talk about it. /By Charles Wilkins UGHN to put more women on SHA

MIDDLE boards and in top jobs. It’s 2019. Where BY Why just banks? are all the women? Pioneering female GAZINE WILLMS;

MA 19 McGugan directors open up on IAN P SS Monster Beverage is how far they have come, TO ; the best-performing and how very much TS BUSINE

TIS major stock this century. further Canada needs ON AR T How do you spot other to go to achieve true category killers like that? boardroom equality. USIVE REPOR CL R /By Steve Brearton, Dawn FO

Y 48 Last Word Calleja and Joanna Pachner Naomi Azrieli, scion ZEMPEL/EX USIVEL of billionaire developer Y CL

EX and philanthropist David EMIL T Azrieli, on building a SHO legacy and how to use VER OOMING it generously CO GR

JUNE 2019 / REPORT ON BUSINESS 3 Publisher PHILLIP CRAWLEY Send us your thoughts at [email protected], Editor-in-Chief, The Globe and Mail tweet us @robmagca and follow us on Instagram @rob_magazine DAVID WALMSLEY June 2019, Volume 35, No.10 Managing Director, Business and Financial Products Editorial Feedback Editor, Report on Business GARTH THOMAS DEREK DECLOET Report on Business magazine is published Assistant Editor DAWN CALLEJA 10 times a year by The Globe and Mail Inc., THE RANT ON TAXATION | The largest Senior Editor JOHN DALY 351 King Street E., Toronto M5A 0N1. bill the Droolers will receive will be the Copy Editor LISA FIELDING, MICHAEL Telephone 416-585-5000. costs of climate change, compounded BARCLAY Letters to the Editor: by the relative inability of their THE RANT | Research CATHERINE DOWLING, [email protected]. generation to use cheap fossil fuels to The youth ANNA-KAISA WALKER The next issue will be on June 28. power their economies and perform Copyright 2019, The Globe and Mail. of today will Art Indexed in the Canadian Periodical Index. the multitude of tasks that are Art Director DOMENIC MACRI presently enjoyed. —Rick Munroe live with Associate Art Director Advertising Offices expectations of BRENNAN HIGGINBOTHAM Head Office, The Globe and Mail, Director of Photography 351 King Street E., Toronto M5A 0N1 services that as CLARE VANDER MEERSCH Telephone 416-585-5111 or toll-free McGUGAN ON SUBSIDIES | There is quite 1-866-999-9237 a bit of evidence that you get a better and a child I could Contributors Branch Offices more resilient economy when governments only dream of. STEVE BREARTON, TREVOR COLE, Montreal 514-982-3050 don’t subsidize businesses. Unfortunately, SARAH EFRON, TIM KILADZE, IAN Vancouver 604-685-0308 governments at all levels have convinced These modern MCGUGAN, JOANNA PACHNER, JUDITH Calgary 403-245-4987 themselves they need to be seen to be doing PEREIRA, RITA TRICHUR, LUIS MORA Email: [email protected] things to “grow the economy.” —George O. standards don’t Advertising United States and countries outside of come for free. Chief Revenue Officer, VP Advertising North America: AJR Media Group, —Rich Schlosser ANDREW SAUNDERS 212-426-5932, ajrmediagroup@ Managing Director, Creative Studios globeandmail.com and Ad Innovation Publications mail registration No. 7418. TRICHUR ON THE CMHC | Given a price limit of $480,000, I do not TRACY DAY The publisher accepts no responsibility see how this helps in Toronto or Vancouver. The interest-free Senior Manager, Special Products for unsolicited manuscripts, ANDREA D’ANDRADE CMHC loan probably replaces loans from the Royal Bank of Mom transparencies or other material. Printed Product Manager in Canada by Transcontinental Printing and Dad, in some cases. The whole concept of encouraging first- RYAN HYSTEAD Inc. Prepress by DMDigital+1. time buyers to take on significant debt to buy into an overheated Production Report on Business magazine is electronically market is just the opposite to the advice you would get from your Managing Director, Print Production available through subscription to Factiva.com from Factiva, parents or financial advisers. —waynes2 SALLY PIRRI Production Co-ordinator at factiva.com/factiva or 416-306-2003. ISABELLE CABRAL tgam.ca/r

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Cumberland Private Wealth Management Inc. Toronto | Calgary | Kingston Partner with us by visiting cumberlandprivatewealth.com or call 1 800 929 8296 ILLUSTRATION DANIEL ZENDER he co a he on peop their penalties this month lucr Th Much mp e to Ca un at ld le suc an elimina na at de me wa abou iv y’ dian ce rs of e s s in , to ss fir piec “b mor the t od a co st depended ro their te sle e ntr fo ught this e d. wo of ra than w act Bu ex y an wa rld of a int perienc or t bigg s 30 infr ex tha has on o the of porting ye a fe er astructur kno t rising co ar re run doe suit es st s d Grease wing ag in a of case. fo sn simp Asian co o, emer doing r e ’t wh wh untries so ” deal me le er en ging long mar busines ex e an I tha the pl wa ke and mar go on ana t t. s bribes wo ve Th s. int ke the Th tion politicians’ To uld ts. rnmen e ervie e da suc fuel Ra fo Of ha ha y, r d stains ce te wing ve nt despit fa to of n, ts ss iling mar ful the go bribery and re busines . e ke pea bidder Eve to ke stif d co y win te his ry fe to rpor d s r tha - , t at vows tinct tion, in yo chang co of wo it ions ’s rruption u’ a dealing rl lar re har d, lack endemic ed. JUNE to pl should ge yo d anning st u Th of sw to 20 amp , with still 19 leg re at e se / h fa mar bribery al REPOR st e on fa of ct ou of op sa it ce ka the re doing t fi fe ev T homeg the mains bl cial trying gu ON de er y and ar BUSINE pr lit ve busines being co ds. tle ospect loping tha a rrup- ro dis- SS has wn t if 5 s vious ur ha at go ow lo te most sho ta the to fa in co in te cap mazyv bribes ous sec en fa ur co wo quir polic speed Bu or ac ba nomic been on or being to on ing tion, infla sc dr the can aging political pub it SNC 6 ring, ing r we d vo Plent Ot We It Th ke JUNE rm our ta e eds still ce al cy ve ve uld mor rr Ca untles this t impr n y bribery ur rl an mor ab ’s to ma co of ws co l lic tha damag lve s ting ss -La re r ed la ta oper rnments d ed e done e— hurting In na e ’r and ge amount co ou benefits le re re y 20 f a co of gr ta me pa rpor ws ha e. sour y damag to ad glob pub . wa ric e to sort Wo at, go d in t’ te e y distrust va dian ze port 19 of nsider ckling ce tr ove of SNC ad tha mp Last be wh other Other in id s co and not ve pub ds pr rna at ve squeez ba than inst of s h ag / ods lin ge ro not nt to e ge its lic e rl REPOR or at has al ce sts, e. as les annuall t co oducti an small at st of ck man eous on been up -t re car t st other tional inflicts d co ions ner the st lic af ta -La e as wa s, in or abilit ntr of y Sept oler a s gr pr permits of tha ems Ru fo wh thr firms it beha ye fo ab la amp Bank, re ex on fa mp enf lking ve ses ke to than long d re busines T s ficials co tc at e mar earned ojects, ease. r tions re ir acts, va ar y ducing busines and le ON tha perts ss in t and at stment, pu ough ep in ve ou hdog poor ing earmar anc the ntr va anies or pa ign sment s sho y ha ga ember fr go pa ians ou y. viour lin ro BUSINE 20 vo so the la fr tat t ke ce t half st om at in pl yments ve acts. ve her insist re ve so e And ri incr ex om t wh te om pr rts co 15 bribery lve ws demand with ts ment sa much ve Th ants ions, an sums and co va st $1 s Tr appr al in r . ev Ca cust tr eng call peg rnments ev co co the mp lit y in tha s str e to , stments SS ich amped, d, ls. abr bidding untries: ke ansp act ancient fo so of long trillion , e re its of easing the idenc enting mpeti- tle bribes na mmit as of wh in haunt at oper- aging anies t. dam- ed r s seri- local hun- d wing ly scar- of oa hug pod ho oms oad ec pr da tha na the has egy im- Bu the the has the fig re ing ar fo ich er- ar- its ch its o- to e- w it t- e e e a r - - - - t t . 100 sco in fo or Tr Ac pr CO crucial sco Corrup In we La ruption dering tion Denmar pr Ja Half ab thanks of Pe and pa st including 40 80 60 90 RE 50 20 30 70 10 Tu ansp r ganiz pa al One Tu 180 ove osecu co ve va GIME, le tr rties. cleaning the b re re rk RR sub Zimb wa rk rd the n obr and stig of ey scandals belo fr Ja ey of ar ment, co ar tion or ing per to and UP st at om co rts FULL DEMOCRACY to to e me is enc bribery in ge un pr an te as, ab ion AU co Zimb k, suppor the no at w engineering ce Do untry to co TION a vo ts Pe ze tial (Oper aning trie obe we of TO as ar y untry’ China, such do or 50 long iv fr nsider pr pr glob fr up a ro as rc In e fe ze lv CR ee ab ed eedoms irr na s oduc is s CPI Sp abus ep te ominent on lit (highly kno nder and ing we a AT DEMOCR ting egularitie ns and co elections its unc has le al doing -running rna Ca tions tions CO Ca and at ain, ed string Eur tle sco the IC ve s nsider an es ge es nada wn ion house nada of te India,

FLAWED DEMOCRACY tional, fa major RE he st a s. ls ove RR re ts ti-c under or inde of and an rrit ir opean HYBRID mone GIME, at co Inde alth of Ir ex as of a AC elections a co civil ed Ca ex ge ODE orrup annual s. e orie nothing of rrup is CPI eland re ha public co functioning 41 x. bet Y ecu Oper y ts be mp x an oil co amined, is anti-c r ve political Mex d with re me democr liber nstruc- (C s. sc sco a y Wa t) at nsider te AU DEMOCR Un S Br tion a mar lo CPI such ti anies, and PI)—tha No giant aning or laun- ing to r da se re ação Ta w , DEMOCR THORIT va ba ve tie azil, and sh). ic HYBRID REGIME Ta and ion job ed. or- 10 sco full ct iw le of ta or fa sic co to s. k- ed st iw o, s, as acie ve or 0 ir ganiz an 22 ther set go ther rrup re an AC politic democr a pr ls elections (v co ARIAN t ve is FULL of s. —it oblems Y ge of ery giv e e rrup , rnmen tion co at Th 81 me ts politic es s al nsider ion AC cle e a aning tion acie is a AUTOCRATIC REGIME CPI , an in t. Y but al ) ed s go sco pa ther we ve a rt re FLA rnanc akne icip e of ar WED at 63 e sses gu Sw te BBC US$3 bo imp prison fa Mar ident Pa house re a 19 and Ro 20 ti his Alan wh cases le tion. a pr the to ants of skuldugg indict Africa. 10 ecu scheme Br co house the ma co va the te cians, cal e ion. fr ve six deal ve or 44, Th Fo Other Br ficials ther rpri ee amed rious 0 azil’ esidents up 17 x, untries ulo duc ilt ya arr de en is to pr s pa Wa co lica scandal. l ce , ” -y azilian deals ga rmer l last ma y Ecua le e Gar s It of of serv rs .5 the Michel est edec illicit ses Du ear Ode ed polic untry’ lo s rties cians, with in its ing ad mansion. including to ar s alian ed pl U. au te arr fo In te of or str bor aw both y fix billion. so and major Ode cia mit e ye up ery rg bribes ea te tc multina d unded him lea , S. and ed petr thorities prison dor ga Br not kids near br est es er ba te estruck. et in still in ll h at wa audacious Pe ar der e pa ar and st co killed Ju niz and te azil d pr tw s politicians echt with sor s br ex of ch Shell, e all Th co rm—spent Te . nk arri ’s La ochemical a at in s sena ha co ru yments d e pr at to stic nstruction osecu s scandal ly echt, o fi ed pl te Eni vic mp Br mer er do in ey e-c under re in to and tin bef alone osecu and ve Among nv cials, co vian te 400-p ye Disg the a near sc his ve nded SA ay US$800 azil’ tional s, himself crime 20 e e-pr e Br e-popping. rm. ze ex anies to re lea ar pl nnection or ict ontr SpA, d . achie ing or America other wh ad and Dep to included to 16 rs other co chang co s eleg us n azilian e at ly ra , s ding ed. to e it to of ex esident pr rs . fa viser Ode lus to look mor in emer ose then rd in mp ex ha “I , It olled ce a re his lef r Br fo 26 r those artment ecu a its bu ve ve esident indict ve miscr disper alian ant t to thir Bu ve in po be million a tr aching fo d 19 fi r under ask t ex politi- an e gr br mak politi- e politi- t ntur d stig home ld sa alleg s lik ne CEO act pr April rmer pr -y yo CEO ti t been fo we their ging with than and- ecu- echt tha y and d and São and one em, nd- ve en- the the go ear os- es- e r oil nd he ed In es of in e- of a- r- s- e, a a a s t - t ,

SOURCE TRANSPARENCY INTERNATIONAL AND THE ECONOMIST INTELLIGENCE UNIT PHOTOGRAPH DAVE CHAN/THE GLOBE AND MAIL ad with might pl fr la pur tic in capit er wh A tion 20 ery fo the suming riousl of than-st ya oper tha fo Or tries st should go elimina in Mar doing, oil vision because lose dog ended million shor co re tr a go luck of a der co bribes edl fo ws handful emmed om ol ve Although Th So Ete fe r ab r tir ay go wning mp the ve mp va the -y ve ga y co er giants t er suit rmer so co nder tr ch stment might did ly ear-old of e pa it’ billions rnmen od nt ement books. gr e on a rnments e at nis str , much te Jo mpetition. an tha anies making oub loot Ne rpor alleg y oil long inc to mor s wo tha fo up ag in ying ellar although , oup ev st ion a na te and y their a ong st fo and co a at har s. xic oil r t op ther the es hug bet d. ga 20 co ha omes, en art uld fi le. if t than co r of re to ion ro ha at e mp edl it t dis eld. ga on pr the er Bu abou d and of p minist ntr and 11 ve trying. mor enf to pl claims ce tide such anti-bribery nv re te co then ya ions of Ni Who will in ve lands. Making books disc deal e in be to ined osecu bet y thr lica ans, r gr t gr sour fo iv the sua ficials. running the denied and olled stl ict lt unde or ge and pot lic job tha doled Ca Th incr signed e healthier y see ing ow t De r de af co Shell also ough we y, ce pr ed rians to ove cases US$1 of er enc te pa mak Ec de fuel wo na t t ex ential kno ce e vo the of uld co and tion the esident th, ment ve . eased Ni doesn other en d, onl pa by it turn ve the mone yments. go onomic da s clusi /Brian fa bridging ting r it politicians e. rl Fo ou rpor an lopment’ ev to es .1 y’r high a ge learned rt time-c loped ws at of ce Eur Dan with ve the ther d y their co on of ar to A and r t y 44 Ni billion er both co rev re ria of US$ e has to no a least rnment char helping bribery ve domes- co ? e untries ’t o wr fo alleg y wa senior at opean ge Good- to chunk wo er co Milner to co nv being Th Ete not mean e risk laun- re their brib- nsid- enue their else- les ions co ong pr will Th rian tc ugh Co 20 of rd run on- un- per ar the en- ge the the ign rth ey ed be te n- h- o- o- in in s- f- s. 0 y e e s s - - , “Ov wo run co co re of achie go mor O’L thr Wo and set als ough ea men “t tu e fa mp me my er ve est ry than fo men. ll by shor r rns has them, te his ost gr nd 90% 50 anie ow er TV 1 4 in t. fr to one ve co th while wo om ha ” se st mp and ta ed rk. t s mode rg anie ve ve 2006 19 sp Un Mr from things men in ets 90s ea nt . s it ” Wo st ur ed ke to so “T e r nde St “The 2014, ca at ftw ac wa member “Ins needs Consider ended Ju se wo Man Mas cu in at pi a rf rv Ke Wi st es ar uld te ta “w er sa omer ul, y ck an e stin ad, sin I busine he to lis chus 3 se ca ed ea en a s quisition d e vin se pa we jus learned ts s. ce of lt to Good tr apprenticeship the ha s ll et cit O’L h- t on the epr sses arr ng to 2009 ts the s y sho bu ea China est mom at ue ap “Soci in Cu CBC Chine Trudeau en ry’ fe ze So a but phone Yo media fa il w, O’Leary cust his ed . pe -in pc der pa il din s eu u In cial her bec ak mo and als the and ss 5 offi ha ar se Te -ch al six r Ap al es g” s, enger media ve o aler ed st us husb Liber ec aus le ce ” daugh her —e at sc ro eek O’L me ev suc visi onom to ril, es tr on to ts e andals ach and daugh act als en re ea the dr ces fo handle hims ca months. di ni O’Le te on spond “If ABC agged ry ’ r t y. n y in pa gaf r borr ckn sf ev a ” JUNE .” in ’s . omer sa of no spend ve I 20 giv giv $40 fo loc than ca dona Bu Be ra mor fe te ul Re ckaged ery als fe ary elf, Dr ys. st der ce t one ’s r. To mp owe a fo Shark t immedia must am member s only off will 20 men Kno e ca deluge Sh busine re ag with in tions “T o $2 al ro aigns than yo 19 wa to od of wa ndida d a e dr he 20 ha Cons ons ar 5, wing nt 2 ins in o t, / enough Unit Ta th the opping al e e 000 REPOR s China. . buck 17 s much O’L k blue co a o. $500 , s ss ta nk of te e on ’ te , th the so jar Ta .” erv ed mo O’L Den nt a u of 10 /J ea ly ha I’ s online in to me the e —run e he m one ly . ohn da ” T ca nk at Airline ba ve ry vir st million “I to ea ,0 co out Ca he rd be of their ON ’s cr in iv n’ st al 00 sa ca impor fr ry mput rk ac ve has nada eat e st -n in t ad st Da men fiv BUSINE of ys. video or om rry giv by le ra quir ill st in s os ow e der si ly th lin ader the ck so e ed nk people so fligh e a two er deb buz ta t ed e s, de n ed e mor cial wa liciting s. e nt in. of SS ship z ts t? up .” ” s e . 7 SPONSOR CONTENT SPONSOR CONTENT

“Sun Life has a strong focus talk about the importance on fostering talent across the of tenacity and resilience. In organization. It’s a champion doing so, I’m being authentic for diversity and inclusion, to my story and my role as a which allows its employees ROWENA CHAN MARIE-CHANTAL CÔTÉ leader.” to be authentic and provide What she likes most about a diverse perspective,” says her career at Sun Life are the Côté, vice-president of market innovative spirit, collaborative WHY THESE development, Group Benefits work environment and working at Sun Life. Her previous roles alongside other passionate have been in the technology colleagues. unit, the project management She has four pieces of office, client experience and advice for women entering digital solutions. the workforce today: “Always What she’s most proud of be your authentic self; be is moving up and around a lifelong learner; aim for LEADERS the organization without excellence, not perfection; compromising her values. and find work-life harmony Côté’s next goal is to become because work-life balance a key thought leader in the VÉRONIQUE DORVAL suggests a trade-off, which transformation of the group doesn’t have to be the case.” benefits business in Canada, while continuing to be a As chief marketing officer for CHOOSE strong advocate for diversity Canada, Samantha O’Neill and inclusion. helps to drive the organization’s Her advice for women goal of helping its clients seeking to advance their achieve lifetime financial SUN LIFE careers is to be authentic. “I security and live healthier became a better leader when lives. “This sense of purpose is I focused more on who I am the foundation of our culture,” versus who I thought people says O’Neill. Five leaders share what Rowena Chan is fulfilling her passion for driving wanted me to be.” O’Neill is most fulfilled on transformational change in her new role as president the job when doing work that KATE NAZAR SAMANTHA O’NEILL drew them to the of Sun Life Financial Distributors (Canada) Inc. “This What Véronique Dorval she’s passionate about, with recent career move is the biggest goal I’ve achieved in enjoys most about working great people, and making an organization and offer my career to date,” says Chan. at Sun Life is the company’s impact. “This has guided every She was drawn to the organization, in part, for its deeply felt purpose to make decision I have made in my advice to women entering ongoing commitment to attracting and retaining a difference in people’s lives career, and it has led me to advisors who reflect the diverse clientele and and the commitment her and collaborative, much like When Kate Nazar was some great places.” the workforce today communities where the organization does business. colleagues demonstrate to the organization. “I like to first diagnosed with late-stage She also takes pride in “More than a third of our advisors are women, and we make this happen every day. understand the root causes of ovarian cancer in May 2003, helping colleagues develop continue to hire new female advisors to better reflect “I work with a great mix of a problem. When we explore her goal was to return to a their careers. “I believe that our clients and society as a whole.” highly experienced people solutions, I believe in the role that she felt was both if you invest in developing SUN LIFE IS ON A MISSION TO HELP its employees Chan also does her part to make Sun Life a fun and from within the industry power of the team to explore meaningful and impactful. your people and creating great push boundaries, seize opportunities and realize challenging place to work. “I have a high expectation and new-to-the-industry multiple perspectives and get “I was able to achieve just opportunities for them, they their goals, with particular emphasis on developing of myself and my team, yet I still take a fairly casual colleagues who bring a fresh to the best answer.” that. Every day since, I’m will repay you with great work. and promoting female leaders. The company’s roster approach and don’t take myself too seriously.” perspective to the work we Her advice to women in the able to make a difference So far, that has probably been shows women hold 34 per cent of vice-president Her advice for women entering the workforce today: do,” Dorval says. workforce is to “believe in and that’s incredibly my secret to success.” or more senior roles and 47 per cent of assistant “Be confident, be visible, and don’t be afraid to take risks. “There’s also a great culture yourself and take risks. Build rewarding.” says Nazar, O’Neill encourages women vice-president or director roles. The Sun Life board Believe in yourself, and have some fun along the way. “ of recognition. Colleagues take your support. Find mentors vice-president of strategy in the workforce to abandon is committed to increasing the number of women in the time to show appreciation who will guide and energise and market development, the notion of “having it all” board and management positions, believing it’s not Marie-Chantal Côté has worked for more than to their peers for the valuable you, colleagues who will push Group Retirement Services and instead focus on doing just the responsible thing to do but also better reflects 20 years at Sun Life, in various roles, which is a work they do.” you to learn and do better; and at Sun Life.“Now, I take the your best at work and at home. its clients and communities. Here’s some perspective testament to her abilities and the organization’s Dorval describes her friends who help you see the opportunity whenever possible “The truth is you can be a great from five female leaders at Sun Life: attention to developing its people. leadership style as analytical bright side on difficult days.” to share my journey and mom and have a great career.”

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Data collection and analytics types of analytics we perform. are transforming industries, We talk about data de-identifi- from healthcare to telecom- cation and aggregation being munications to marketing to used to ensure that data isn’t infrastructure. For companies linked to individual customers. both big and small, using and Also, we are one of the only analyzing data has enormous private sector companies to potential to improve efficiency put our privacy management and drive innovation. At the program framework online. same time, people are becoming more and more concerned Kingsmill: Public perception is about privacy, the security of more important than ever be- their data and how it’s being fore and I think there needs to used. be more education and aware- Sylvia Kingsmill is a partner ness about the privacy risks at at KPMG in Canada, and the the end user level – it’s their firm’s National Digital Privacy data after all. One market trend and Information Management ‘THE PRIVACY DIALOGUE I’ve seen is the uptake in com- leader. Pamela Snively is chief panies undergoing voluntary data and trust officer at Telus HAS RADICALLY CHANGED’ privacy risk assessments and Communications Inc. The certifications at both the con- two leaders came together to Experts discuss the opportunities of harnessing ceptual and design stages of discuss how companies can data while protecting customer privacy their products. The law does not harness the power of data to evolve quickly enough to keep fuel innovation, yet still protect pace with emerging tech and as the privacy of their customers. public sector about privacy ing robust security safeguards, a result, we are seeing industry rights. But in the private sector, testing and monitoring, and groups collaborating at both the How have discussions privacy just wasn’t a topic a strong access controls to mini- national and international levels around privacy changed from decade ago the way it is today. mize who gets access to what to develop privacy-by-design five or 10 years ago? I think the recent scandals and why, even for anonymized and ethics standards. Sylvia Kingsmill: The privacy involving Facebook and Cam- datasets to protect against the conversation has taken a dif- bridge Analytica have made risk of re-identification. How do telcos build trust ferent tone - it’s no longer just consumers acutely aware that with the customer? about compliance in terms of data could be used in ways we Snively: If you don’t need to Snively: I think that starts what must be done to meet hadn’t imagined, in ways that collect it, don’t collect it. And internally. At Telus, we made baseline legal requirements. could impact our autonomy as if you do need it for a purpose, sure that we created a culture The conversation is moving individuals and our democracy. make sure you’re deleting it among our own employees for towards a privacy-engineering And I think the dialogue around as soon as possible after it’s them to understand how critical approach in terms of how privacy has radically changed as served that purpose. At Telus, it is for customers to trust in privacy can be operationalized a result. We’re now talking a lot for instance, we don’t collect us. Yo u need to think of privacy through technology. Protecting more about data use and not the contents of text messages. from the perspective of, “Will privacy is not just about having just about data security. Technologically, we would be my customer be disappointed a legal policy in place that no capable of doing that easily. But in us if they were to hear about one can really understand and What are the biggest risk we don’t have a business need this? Would they be shocked by signing a Confidentiality Agree- factors that companies face to do it and it would be highly this use of their data?” ment. It’s about ‘privacy by when it comes to data? invasive. There needs to be design’ thinking, as advocated Kingsmill: The common risks more education and discussion Kingsmill: Yo u’ve got to prac- by former Ontario Privacy Com- we see across most organiza- about appropriate data usage in tice what you preach. The legal missioner Ann Cavoukian, to tions is the over-collection and the public space. rules of engagement are just a stay ahead of the risk. retention of data, the lack of a starting point; there should be Companies that want to trans- data governance framework to Do companies have a a code of conduct, tone from form digitally are competing enable organizations to better responsibility to be more the top and data practices that on trust when it comes to their leverage their data assets, transparent with data? demonstrate a true commit- customer’s data, differentiating and even far worse, assuming Snively: Absolutely. I think ment to privacy that can easily themselves with a privacy-first that anonymized data is more we can all do a better job and be reflected in a street-friendly, mindset to deliver a better, secure or won’t attract regula- certainly Telus has been very transparent privacy policy. Trans- more dynamic and seamless tory scrutiny. These risks can be focused on that over the last parency equates trust. customer experience. managed with a more holistic couple of years. One example data protection approach, which is we put more information This content was produced by Globe Content Studio. The Globe’s Pamela Snively: I think we’ve includes a strong accountability on our website about how we editorial department was not always been concerned in the model in addition to implement- perform data analytics and the involved in its creation. PHOTOGRAPHS LORELLA ZANETTI go ve Ma rnmen Ca In nada’ the t me wo s mo ster an uld st time jus pr t olific , ge he t ’s out home of mo by Th e of Tr ving Ex evor the builder change the Ma way Cole tt , am Pe so te y he be r Gilgan, house ca yo n nd build re wishe al mor esta s e te the hous es . $31 re suit li Fo ride arri billionair At I mar bu specula bu sell home Ac market What ye health Wha is and co of old onl In (MAM), Ma re gi A the his to eag co of “I and opens bu means ce and He to industrial-siz pric pur per ving por t’ ve sidential as bicy iling ar incided mp ur the Ma re the ye ying t fa million. tuall 6 s y tt pour er tw 1. ve re Gilg chas e e he it ke s desir Gilg we s te ct, six to ga p. sonall str t’ am rs shin Seasons JUNE wa ’s is Th lica the tt ach ag fo d o to s go dly wh hip north. y t. m. cling ont has le it’ the your ar vie y, am a ong a being dif in set ting e e re s home. y o’ r an position. Th o s an ta t a s tit ne me y tions, e 20 e e I ile on mor fo clock, As tw of ce deli is o joint Canada pric Incr of I’m the fe w y ’s ne lk time with tle priorities. think y 43r ne fo Pe no ey 19 home anium hea under w a as ac tha Ho nt tha re set sense o his Ca lif a ad of wh with abou w r va / w e te e tr in ve Ho home lef mar d long a we martinis, cident nt es I’v REPOR home eases e. 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72 2019 out of step with inflation generally, 7 686,

including inflation in wages. (2) 29

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stress test? (3) 5 372

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usefulness. Look, there’s always 7, 42 98 1,2 36 1,2 been risk when you buy a house. 40 2 3, 1,8 39 38 6 6

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that when you go to renew the 7 1, 311, 5, 09 5, 29 712 096 29 29 99 8, mortgage, it’s going to be higher. 28 27 38 6, 3, 26 2, 0 9 ,5 24

I think the stress test was put in 23 23 23 38 22 1, 199 place partly because of concern 9, 17 about levels of debt, but also as 16 the federal government’s way of slowing this runaway inflation. Are you concerned about debt? I am. I would like to believe that PE YT SK NL BC AB NS NT CA as long as we have reasonable NB QC ON MB restrictions, reasonable credit valuations and so forth, at the end of the day, Canadians are 2. Home the environment. And you may what’s going on and the fact that responsible people. They’ll know prices across not know much about me, but they or their children can’t afford the country when they’re up to here. I don’t (see chart I can tell you I’m very much an to buy a house. think a central authority should above). advocate for the environment. That all of this land isn’t available. be telling them what to do. So would you protect the Correct, sir. See that height of 3. Under the Twenty years ago in Toronto, the stress test Greenbelt? land right out there? [He points price-to-income ratio for a two- instituted I would protect nature. to a long ridge of land to the income household and an average in January You’re making a distinction north.] That’s the Oak Ridges 2018, home was 4.5. Now, it’s double prospective between nature and the Greenbelt? Moraine. Do you know how that. Would you agree there’s an mortgage Two or three more of these [he it came to be? I do. Glaciers holders need affordability crisis? to prove gestures at his martini], and it scraped across thousands of Strongly agree. If you want to lay they can would be crystal clear. I believe miles, and when they melted, blame anywhere for why some afford their modern science should be they deposited remnants of gravel payments if young people today are struggling the interest applied to evaluating, without tens to hundreds of feet deep. to buy a house, you can smack it rate were politics, without rhetoric, without So that land we’re looking at is right onto government policy. two points emotion. Let’s recognize the role really a great big pile of gravel. higher You’re not in favour of government than their this regional economy has, and Gravel is porous. Those are the intervention. negotiated let’s responsibly—and I mean sources of our river systems. I I’m in favour of the opposite. rate or the responsible to all stakeholders, get it. I respect it. But I’m saying, Bank of Which is? Canada’s including Mother Nature—use shouldn’t there be room for Get the hell out of the way and five-year science, rather than rhetoric. modern soil science, building let us bring more product to the rate. Most politicians don’t want to give science, engineering science to market. Economics 101, lesson scientists the power to make these be able to demonstrate that a one: supply, demand. That’s decisions. particular development can be the problem. In Metropolitan I’m not sure scientists should done without polluting? Toronto and the Greater Golden make the decision. They should Broadly speaking, more people are Horseshoe area, where there has opine on what’s reasonable. moving into the city. What’s the been great job growth leading Do you feel the Greenbelt is future of the suburbs? to great population growth, the unreasonable? I see the future as really bright. ability to keep pace with that You have to start with first The more aspirational people has been massively curtailed in principles. What is it that society are about home ownership, the the past 20 years. The largest wants to preserve? Give society more inclined they are to live in component cost of a home is the the trade-offs, and let society the suburbs. As it becomes an land, because the province has tell us—society broadly, not a increasingly important part of put so many limitations on supply. fringe group. Let’s give the silent defining who they are or what Now, it gets sticky. Because most majority a voice. The silent they want for themselves, they of the limitations on supply are majority, I think, is starting to will strive that way. Sometimes under the auspices of protecting make the connection between that’s the more executive-type

12 JUNE 2019 / REPORT ON BUSINESS this month

4. Larry given, and it has brought me Nicholson, immense gratification in my life. the recently retired CEO You’re the first billionaire I’ve had of the fifth- a chance to ask about this: Do you largest home worry about wealth disparity? builder in the U.S., is the One might say, if you want to be new chair. cynical, “Why are you so wealthy? Former Aimia Why do you need all this money?” CEO Rupert Duchesne is You need all this money in order a director. to grow industries and capital, 5. Gilgan’s and continue to support the net worth economy. You can’t run a business is roughly without having a balance sheet. $4.4 billion, according to It’s like, 20,000 people work for person or a new Canadian. They children and my grandchildren Forbes. this business, and would they are willing to do whatever it are custodians of that money, all have jobs without it? I’m not 6. The Gilgan takes—to live, as many of our and we use it wisely. We use it for Foundation’s sure. A lot of what we do is create ancestors did, two or three good things, including growth of giving opportunities for others. families in a house to afford it. the businesses and doing good includes: What do you say to people who Let’s talk about MAM. You once things for society. Part of that is $10 are frustrated that the benefits of said, “There is an element of having a variety of asset classes. MILLION society are beyond their reach? timing in this business.” Why is There’s certainly some money Do you know what our income St. Joseph’s the time right for MAM? set aside for a startup in an area Health Centre tax rate is in Ontario? Like, the The time is right in the evolution of passion of mine specifically, (2017) combined federal and provincial of the whole organization. Ten which is the intersection of tax rate? Once you get past or 12 years ago, I said, I want this sustainability and technology. $30 100,000 bucks or something, it’s home-building business to thrive You’ve talked in the past about the MILLION 54%. And with the other 46%, beyond Peter Gilgan. The only fact that your kids aren’t involved you pay GST on everything you way to do that would be to start in your business. St. Michael’s buy. We have a massive taxation to conduct ourselves somewhat They’re not involved in the Hospital regime here in Canada. akin to the discipline of a public home-building business. (2014) So you don’t agree with Bill Gates company. They’re involved in our family and Warren Buffett and Ray Dalio So you brought in the board. (4) office, and they have become $40 and other billionaires, who say Yes, sir. So the business is set increasingly involved in some of MILLION they want to pay more tax? up in a manner where Peter the investment activities. I’ve got I’d like to see our taxes being Gilgan is not nearly as needed. a son studying to be a doctor. I used more efficiently—how’s Sick Kids Another element is the adage say, “Do what you want to do, not Hospital that? Look, when I was riding about not putting all your eggs what Daddy wants you to do.” (2012) my bicycle on Sunday morning, in one basket. That’s a truism But is the creation of MAM at least I rode down Bay Street. And on I have not ascribed to for the in part a way to address this need $15 every goddamn corner, there MILLION past 40 years, and it is now time to have your kids involved? is a guy sleeping. Do you think to do it. Our 10-year plan in That’s a very insightful question. Ryerson that doesn’t bother me? Yes, Canada has only modest growth. Wow. [He looks away.] How University’s that bothers me. Is that my We don’t currently believe the honest do I want to be about that? Athletic responsibility? Not directly. One Centre (2011) opportunities exist, based on the Hell, yeah! Hell, yeah! If I’ve got individual or one family can’t do risk profile of legislation, for us to a kid who doesn’t like mud and $10 everything. And you’ve got to invest more in Canada. It makes sticks, but he likes the idea that he MILLION know there’s so much inefficiency no goddamn sense. We would could be involved in something Oakville in what we do with our taxation. need to see different signals from around sustainability? Absolutely. Trafalgar What happens with all that government before we would You are a big-time philanthropist. Memorial money, man? Where the hell does Hospital want to be more aggressive in The last figure I saw was $175 (2010) it all go? So let’s raise taxes so the growing our business in Canada. million. It’s probably more now. government can become more So what are you going to do with Yes, sir. And you’re going to see inefficient? I don’t think so. MAM? a big announcement in June. It’s What am I going to do with the gonna be pretty impressive. (6) Trevor Cole is the award- money I have been fortunate Should Canada’s wealthy do more winning author of five books, including The Whisky King, enough to make? (5) My intention than they’re doing right now? a non-fiction account of is that it is intergenerational I would say yes. I can say I have Canada’s most infamous money—that myself and my never missed one dollar I’ve mobster bootlegger.

JUNE 2019 / REPORT ON BUSINESS 13 Panorama Yen for style

here’s not much connecting face masks to 1 fried-egg moulds to boxes of Pocky. But 80% under the trendy umbrella of Japanese design, Portion of Oomomo just about anything sells—cheaply—at the shoppers who brightly lit, colour-coded Oomomo store in are women, Toronto. Majority-owned by Vancouver’s making cosmetics Fairchild Group, Oomomo debuted in second only Edmonton in 2017; it now has two stores in to food in Alberta, two in B.C. and this one, open since terms of sales December. So far, it’s the largest, at 13,000 square feet (a few thousand more than a typical Dollarama), though a store in nearby 500 Number of Markham is expected to top 21,000 when it stores Toyko- opens in June. By 2022, Oomomo expects to based Miniso have 20 stores across the country. plans for Canada by It’s one of several “100-yen” retailers to hit 2021 Canada, including Daiso (with 5,050 stores globally but just one in North America, in Humans Richmond, B.C.) and Miniso, a Chinese- have created owned retailer with Japanese designs and 50 Canadian outlets. They’re thriving (even 8 as Dollarama, with 1,225 stores, struggles) BILLION 4 selling exclusive Japanese brands and an TONNES elevated experience. of plastic since “People are looking for affordable items, large-scale production yet they want better quality,” says Mimi Lam, began in the who manages Oomomo Toronto. “If you want 1950s quality, you’ll come to us, not Dollarama.” Oomomo carries a rainbow’s array of more Canada recycles than 22,000 products. Most sell for $2, though just 9% of its you’ll find $11 face masks and $8 jewellery plastic, with stands on prominent display. 3.2 So how does this vast assortment fit with MILLION that other Japanese trend, the decluttering TONNES craze? “When you come here, you realize ending up as there are a lot of things you don’t need—but garbage in 2016 kind of need,” says Lam, pointing to a wall of plastic organizers. “We offer ways to help VUONG minimize your lifestyle.” /Matt O’Grady TIE CHRIS 1 Oil catch sheets, $2 | 2 Silicone fried-egg shaper, $2 | 3 Mitsui Norinchu Nitto Tea-Amazake, $8 | 4 Wasabi-flavoured KitKat, $15 | 5 Moko APH GR

Moko Mokolet 7 candy, $7.50 | 6 Dehumidifier sheet, $2 | 7 Foaming TO net with case, $2 | 8 Double-folded eyelid tape, $2 | 9 Kracie Popin Cookin

7 PHO Doughnut DIY candy kit, $6.50

14 JUNE 2019 / REPORT ON BUSINESS 2 3

5 6

8 9

JUNE 2019 / REPORT ON BUSINESS 15 SPONSOR CONTENT

MACKENZIE ATTEMPTS TO ‘MOVE THE

NEEDLE’ ON Kristi AshcroftPrerna Chandak GENDER EQUITY “Women sometimes get in the but was concerned about how way of their own success, often others would perceive her unintentionally,” Chandak qualifications, given her time Female executives encouraged by progress, CEO’s says. “Part of it is not being out of the workplace. “That was commitment to diversity vocal enough, [not] accepting a big insecurity,” she says. compliments or [not] speaking Ashcroft says women need to their accomplishments. It all to “reframe” their skill sets to comes down to mindset.” draw not just on past work ex- Women account for more than including Mackenzie, where Chandak speaks from experi- perience, but also what they do half of the entry-level positions chief executive officer Barry ence, having suffered from outside the workplace. “Women at banks and insurance compa- McInerney has stated publicly “imposter syndrome” – a feeling should ask themselves: ‘What nies in North America. that diversity is a top priority at inadequacy, common among skills do I have or am I building However, the same research the firm. women, despite obvious quali- that are transferable?’ I give a from McKinsey & Co. shows In late 2017, the organization fications and career success. lot of credit to Mackenzie for fewer than one-in-five women launched the Mackenzie Global Having advocates around her, being open to and recognizing hold management positions Leadership Impact ETF, which both male and female, helped what else I had to offer,” she in the financial services sector, invests in companies that pro- her overcome any doubts about says. which is a concern as compa- mote gender diversity and lead- her abilities, she says, and em- nies aim to increase diversity in ership. The organization also powered her to put forward her FINANCIAL SERVICES the executive ranks. launched “Mackenzie Together: own ideas on the job. AS A PLACE FOR WOMEN A lack of female role mod- Championing Women’s Worth,” “Too often women close TO THRIVE els, concerns about work-life a platform created to solidify themselves to opportunities balance and too few sponsor- its commitment to the issue when they should embrace Both Chandak and Ashcroft ships programs are cited for the of gender diversity, and was them, no matter how daunting encourage women to see the dearth of women in board and the founding sponsor of The they may seem at first,” she says. financial services industry as a management positions. Women’s Collection, Canada’s place where they can grow and first technology-driven, female- WOMEN NEED TO ‘REFRAME’ thrive. TIME FOR A CULTURAL SHIFT focused financial literacy and THEIR SKILL SETS While the industry still needs investment platform. to achieve greater gender For many firms in the financial “It’s one thing to talk about For Kristi Ashcroft, a vice- equity, particularly in the services business, achieving diversity internally, but when president and senior invest- executive suite, both women gender diversity requires a cul- the commitment is made ment director with Mackenzie’s are encouraged by the progress tural shift, starting with ridding publicly, it adds credibility,” says fixed-income team, a risk – and that has been made since they the sector of its long-standing Chandak, who has an under- opportunity – was leaving the started their careers in financial reputation of being an “old graduate degree in finance and industry for a decade to raise services. boys’ club.” economics from the University her three sons. “There are so many differ- The industry is evolving, “but of Windsor and an MBA from “It was very daunting for me ent careers in this industry,” we still have a way to go,” says IE Business School in Spain. to come back,” says Ashcroft, Ashcroft says. “Not only is it Prerna Chandak,vice-president who has an economics degree exciting, but it can be lucrative of product and strategy for WOMEN NEED TO STEP UP, from Princeton University and empowering for women. exchange-traded funds at TAKE RISKS and worked for many years Chart your own path. Be bold Mackenzie Financial Corp. for investment banks in New and be patient as we hopefully Chandak, who worked for While there are many built-in York and London before tak- continue to move the needle.” • various Canadian financial barriers for women in the working a break and then joining services companies before place that need to be broken Mackenzie in Toronto in the fall joining Mackenzie in early down, Chandak says women of 2015. This content was produced by Globe Content Studio. The Globe’s editorial 2017, says some companies must also take responsibility Ashcroft was confident she department was not involved in its are further along than others, for advancing their careers. had the skills to return to work creation. BETTER TOGETHER.

At Mackenzie Investments, we believe in the power of equality. The divides we bridge and the barriers we shatter become our legacy for the next generation. It changes outcomes for girls and for women and ultimately creates a better future for all of us. Together, we have the courage and vision to make the difference. Learn more at mackenzieinvestments.com isn’t enough to improve women’s representation in leadership roles. In 2017, women comprised 37.6% of the Rita Trichur senior managers and 58.3% of the workforce at the country’s six largest banks, excluding subsidiaries, according to the Promises, promises Canadian Bankers Association (CBA), an industry lobby group. But it’s unknown Disclosure isn’t enough. To improve their records how many worked in a profit-and-loss on diversity, companies have to hire more women executives, (P&L) capacity versus back-office jobs. pay them more and be quicker about it At the board level, meanwhile, an average of just 36% of director roles at the Big Six were filled by women. t takes big ovaries to do Shem- That’s actually better than many other ara Wikramanayake’s job. Not There’s no dearth industries, such as technology, mining or only is she the mother of two of female talent energy, but the prospect of a Canadian teenagers, she’s the first woman within Canadian female bank CEO still seems very remote. to lead Australian investment Compared with banks in other countries, bank Macquarie Group. Since companies. the Big Six look positively passé. The being named CEO last year, the 57-year-old The main obstacle CEOs of three of Israel’s five largest banks has spoken out about the lack of women’s to women’s are women: Rakefet Russak-Aminoach leadership in finance. She says companies at Bank Leumi, Lilach Asher-Topilsky of need to be more flexible with women and advancement Israel Discount Bank and First Interna- men so both can better balance their per- continues to be tional Bank of Israel’s Smadar Barber-Tsa- sonal and professional goals. cliquish, male- dik. In Australia, Wikramanayake is the “I married late, in my late 30s, and had second woman to run a major bank after children then. And my husband elected dominated Gail Kelly, who was CEO of Westpac from to be the one who became primary carer corporate cultures 2008 to 2015. in our family,” Wikramanayake said in a If Ottawa is serious about moving the bank video commemorating International needle on diversity, it should require com- Women’s Day. “That’s made for a lot of panies in all federally regulated indus- interesting role modelling.” % OF SENIOR MANAGEMENT tries, such as telecom and transportation, Alas, Wikramanayake’s experience re- POSITIONS HELD BY WOMEN to adopt term and age limits for directors. mains an exception rather than the rule AT CANADIAN BANKS Board renewal not only creates openings for women in banking. In Canada, the 37.6% for new candidates, but it also prevents Trudeau government wants banks to be 30% directors from getting too cozy with man- more transparent about their policies to agement, says the Canadian Gender and increase diversity on boards and in senior 15.8% Good Governance Alliance. Companies management—or so it said in a single should also disclose how many women are throwaway line in its budget in March. employed in P&L roles and their average 2.6% Big whoop. It’s already clear the new pay compared with male peers. requirements will do nothing to dismantle 1987 1995 2005 2017 Institutional investors, such as big pen- the organizational and cultural barriers WOMEN’S PAY AT CANADIAN sion funds, should also push companies to that hinder women’s ascent on Bay Street. BANKS IN THE U.K. tie executive compensation to promoting For starters, banks won’t be required to (MEDIAN COMPARED TO MEN, diversity and press them to close the gen- MANDATORY DISCLOSURE, 2018) go above and beyond the disclosure rules der pay gap through the use of quotas, if RBC TD that already apply to other industries. necessary. Ye s, quotas—because they’re Instead, banks must align their practices more powerful than disclosure alone. with measures in the Canada Business 71% 50% There’s no dearth of female talent within Corporations Act. That law, which was Canadian companies. The main obstacle amended about a year ago, requires com- to women’s advancement continues to be panies to give shareholders details about BMO SCOTIA cliquish, male-dominated corporate cul- their diversity policies or explain their tures. If Wikramanayake, a woman of Sri decision to withhold such information. Lankan heritage, can reach the upper ech-

68% 65% MORA But the big banks already make such elons of Australia’s business community, disclosures to investors, and the federal surely Canada can do better. LUIS banking regulator has separate guidelines covering board composition and senior Rita Trichur is the financial services editor with The Globe and Mail. You can reach her at management changes. Disclosure simply [email protected] or on Twitter @RitaTrichur PHOTOGRAPH

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Susan Howson, director and portfolio manager, Mackie Research Capital Corp. TAKING Can having adult children in charge of their parents’ investments be awkward for an advisor? CONTROL Children may say, “You have mom in 70 per cent equities at 80 years of age. That is not appropriate.” OF AGING Well, it is because your mother wanted to build an estate. Your mother was aware of inflation and wanted to stay ahead of it and PARENTS’ was very comfortable with this asset mix. The reality is Alzheim- er’s disease is not a death notice. NEEDS The parent can live well into their 90s with increased financial ex- penses – and a good advisor will AS THE POPULATION CONTINUES TO have planned for that. AGE, ADULT CHILDREN NEED TO PLAY Where should people start in A CRITICAL ROLE IN HANDLING THEIR getting a power of attorney for ELDERLY PARENTS’ FINANCIAL AND health and finances, updating or HEALTH-RELATED NEEDS creating a will and finding long- term care? I had a perfect case a year ago. The daughter lived out west. More and more middle-aged Ca- forget things they would usually of attorney?” At that point, they Mom decided she needed to nadians are making the difficult remember, such as anniversary usually start to talk about their move into a retirement home. transition to becoming caregiv- dates and names of close friends. children. By then, I have a sense The daughter helped with ers for their elderly parents, who For children who visit their whom in the family or which the move and it became quite require an increasing amount of parents, look to see if their house friend may call me. evident the mother had not been attention. is not as clean as it usually is, if managing well. The daughter For people in this position, the their mail is unopened or unpaid How do you handle the delicate called me for a meeting and challenges can be significant, bills are piling up and if their situations in which you have an because they were both there, I says Susan Howson, director and clothing has holes in it or is dirty. elderly client in physical and could share the finances – that portfolio manager at Toronto- If the parents drive, look to see if mental decline? there was sufficient money and based Mackie Research Capital the car has dings and scratches It can be difficult because ev- how it was being managed. Then, Corp. on it. eryone can have an off day. But I when it really became time to Namely, the financial stakes know my clients, how they sound, trigger the power of attorney, the are increasing as costly diseases What steps should adult children respond, so I listen to things daughter was quite aware of how such as Alzheimer’s are on the take if they see a decline in their that may appear to be off and everything was managed. That rise, the price of long-term care parent’s physical or mental health? make the appropriate judgment was ideal. continues to increase and public They should let their parent’s fi- call. If there’s something that’s or private health plans don’t nancial advisor know. They need bothering me, I’ll communicate How have you changed your busi- cover many drugs and therapies. to monitor the situation and see with that client’s trusted contact ness model to deal with rising Ms. Howson discusses the how bad it is. This situation can person, let them know something number of elderly clients? evolving needs of the aging be tricky because you need to doesn’t seem quite right and ask I have repositioned most of my demographic and the role that bring in a doctor to determine them to check it out. clients into discretionary man- families play in the process, as el- what level the parent is at – and aged, fee-based accounts. This derly parents require more help trying to get a parent to go to the In cases in which adult children structure acts as an insurance in financial and health-related doctor can be difficult. are suddenly in charge of an el- policy as clients get older. We matters. derly parent’s care and finances, set up a conversation to discuss Canadians are generally reluctant what issues tend to come up? their requirements. I then man- What are the first warning signs to talk about their finances. Is it Sometimes, children go to their age their money accordingly to adult children should look for any different with the elderly? parent’s advisor and say, “We ensure they have the income that they may need to “step up” People in that age group don’t have the power of attorney and they need and don’t have to make and become more involved in talk about money – particularly we are going to take over the decisions as to buying or selling their parents’ day-to-day affairs? with their families. Generally, the finances.” The problem is they securities. This takes that pres- There can be definite signs. If the children have absolutely no idea have no history, they have no sure away from them and also children are out of town and talk about the extent of their parents’ sense of how the money has been means that if they become ill or to their parents on the phone, finances. Where the conversation managed for the parent – and not capable of managing their they should listen for things such starts for me is when I ask, “Do they are looking at everything money, there is no immediate as repetition and if the parents you have you a will and a power from their own point of view. pressure for the family to do so.

This content was produced by Globe Content Studio. The Globe’s editorial department was not involved in its creation.

22 JUNE 20 19 / REPOR T ON BUSINE SS

PHOTOGRAPH PHOTOGRAPH St Ne and tfl helped ix ’s Bennet tuned Ca by nadian tr Alec ans ay fo Sc Ke fo chie rm ot t the f mark | st of ne pho re et aming to ing r gr aphs offi episode lly gian ce by r t had the in Shaughn to xt one a po of we and Th the rhous en John to he p e t decided job of s original in the to JUNE wa busine co 20 nt lk 19 en aw / REPOR ss t. ay T ON BUSINE SS 23 This started out as a story about a small-town boy who made good, of how Kelly Bennett, born and raised on Vancouver Island, landed what is argu- ably one of the top advertising jobs in the world, or at least in Hollywood, as Netflix’s chief marketing As befits a company that straddles the worlds of officer, with an estimated annual budget nudging $3 billion. technology and entertainment, Netflix has offices When Bennett joined the streaming company in 2012, it was on in both Silicon Valley and Los Angeles—a campus the brink of its second great transformation. Five years earlier, it had in Los Gatos, a posh town south of San Francisco, pivoted from mailing out DVDs to streaming films and TV shows. and a studio and 14-floor office tower on Sunset Now, it was moving from streaming content produced by others to Boulevard in Hollywood. The latter is a storied making its own. Through a combination of data, killer content and, site—a former farm purchased in 1919 by the actual Warner brothers. The world’s first talkie, yes, smart marketing, Netflix quickly changed what we watched The Jazz Singer, was made here, and so were the and how we watched it—much to the chagrin of traditional studios, hit silent films starring the dog Rin-Tin-Tin. movie-theatre chains and cable companies—and became an inex- The relics on display in Netflix’s lobby evoke tricable part of pop culture, first in North and Latin America, and much more recent productions. A replica of the then globally. In January 2016, Netflix began, overnight, to stream marble chair that features so centrally in its first in 190 nations—every major market except China. Since then, it has original series, House of Cards, sits in one corner, just waiting for visitors to perch on it and take self- gone from 25 million subscribers to roughly 150 million, and now ies (though in the wake of sexual assault accusa- has a market valuation of $150 billion (all currency in U.S. dollars). tions against its long-time star Kevin Spacey, no According to Reed Hastings, Netflix’s co- one is doing so). On a glass table sits a bowl of can- founder, chair and CEO, Bennett—whom he has dies whose wrappers feature the five guys from called his “chief emotion officer”—has played an Queer Eye. An entire wall is covered in redwoods invaluable role in driving that growth. He and his that I recognize as a setting from the movie Bird marketing team of 1,000 spread across the globe Box, starring Sandra Bullock. At first, I mistake the have helped persuade viewers, via billboards, ads, images for wallpaper, but then a butterfly flutters emails and social media, not just to not tune in among the trees; it turns out the wall isn’t a wall to shows like House of Cards, Orange Is the New at all but a giant LED screen. So much is not quite Black and Stranger Things, and movies like Roma, what it appears here. but to sign up for a monthly subscription in order It’s early February, the day after the Super Bowl, to do so. And his team has done it in 20 languages. and outside the fog is burning off a hillside to But here comes the plot twist: About a month reveal the white block letters of the Hollywood after I travelled to Los Angeles to meet Bennett sign. It’s 9:30 a.m., and Bennett is presiding over for the first time, I got a call from a Netflix spokes- the first of his Monday meetings with the 12 peo- person. Bennett, he said, had decided to “retire” at ple who oversee Netflix marketing in the Ameri- the age of 47 (leaving behind a $6.2-million salary) cas, Europe, the Middle East and Africa. (He’ll sit once Hastings has found a suitable replacement through another such meeting later that evening or, in any event, by December. Officially, Bennett with the team in charge of Asia and the Far East.) was stepping down to “be a better husband and Bennett himself is jet-lagged, having just father.” But were there other factors at play? He’s returned from visiting Netflix offices in London not the first high-profile Netflix executive to leave and Amsterdam. But he shows few signs of weari- in the past year (long-time chief financial officer ness. He’s wearing a black shirt and pants on a David Wells announced he was stepping down trim frame, and his dark hair is moulded into a this past August). And there has certainly been Tintin tuft on top. His voice is his most distinctive tension at Netflix between the entertainment side feature, though—it’s a radio voice, and his accent of the business and the data-driven tech side— is Canadian with some British and Los Angeles tension that has, from time to time, crept into Ben- on top, though it somehow never sounds preten- nett’s relationship with Hastings. The CEO has tious, the way some mixed-up, mid-Atlantic ones been known to downplay the importance of mar- can. He’s careful in what he says, private, his face keting, going so far as to say that he foresees a day friendly but hard to read. when Netflix’s algorithm (the one that fills your Bennett runs a tight, cheerful meeting, asking personalized home page with suggestions of what open-ended questions, passing on his thoughts to watch, with varying degrees of success) is so about promotional campaigns they’re running precise, the company won’t even need to advertise around the world. The previous night’s football its movies and TV shows. game gets a passing mention. Bennett’s crew is And so this story became one not just about how far more interested in the ads—specifically rival a one-time hockey jock from Nanaimo hit it big, HBO’s partnership with Bud Lite to produce a spot but also about why he’d walk away from it all. promoting its flagship series Game of Thrones,

24 JUNE 2019 / REPORT ON BUSINESS complete with jousters and a fire-breathing dragon that swoops in to torch the spectators. The flashy ad was starkly different from Netflix’s own Super Bowl offering, for Richard Attenborough’s new series, Our Planet. It starts with an orangutan and her baby, the baby’s eyes staring straight at viewers before giving way to animals in their endangered habitats—whales, polar bears, electric-green toads—en route to the game-related tag-line: “We’re all on one team.” It’s a moving spot, with stunning images. But was it too quiet amid the noise generated by the other Super Bowl ads? “We tend to zig where others zag,” Bennett says. They move on to discuss some upcoming promotional campaigns—here, “Rene” and “Jake” are Russo and Gyllenhaal, the co-stars of the upcoming Netflix horror flick Velvet Buzzsaw. Bennett’s question with respect to the talent is always, “Will they work for us?” (In both cases, the answer is yes.) The meeting’s mix conveys the job’s variety. Bennett manages employees across seven offices globally, creating advertising across a bewilder- ing array of media: traditional commercials, bill- Bennett worked on his brother’s wall, stuck full of pins to mark all the boards, digital interactives, social media, email. On ad campaigns for places he wanted to go. “You had this sense that he The Matrix and the top of all that, the team is responsible for the over- Harry Potter franchise was going to get there,” says Shane. “He was always all Netflix brand, right down to the logo (a new ver- for Warner Brothers the first kid to try something—the first to have a sion of which Bennett’s team had launched over in London before skateboard, the first with whatever new trend.” the weekend, eliciting a terse, “Good job, dude” moving to Los Young Kelly was TV- and movie-mad, pro- Angeles, where from Hastings for Stephen Bruno, a former HBO he caught the eye nouncing these rarely heard words: “I just loved exec and Bennett’s global marketing chief, who of Netflix’s CEO Canadian television.” (He was a particular fan was in charge of the project). of The Beachcombers, which was filmed in Gib- While he sweats through the meeting’s small sons, B.C., just across the Strait of Georgia from stuff, Bennett says he always tries to keep one Nanaimo.) But when it came time for university, larger concept in mind. “I call it the brand bank. Bennett opted to study business at Simon Fraser As a business, every interaction we have with our in Vancouver. His family had no money to help members or consumers that is generally positive with tuition, so he worked nights and weekends at is a deposit in the brand bank. If you open your a Save-On-Foods supermarket to pay the bills. “I TV and the brand loads, that’s a little deposit. You was putting in 40 to 60 hours a week at work and find a show that you like—a deposit; a show you carrying a full course load,” says Bennett. “I didn’t love, that you binge on, like Stranger Things, do have the university experience some of my class- two seasons in a weekend? That’s wads of cash.” mates did.” He also couldn’t afford to accept low- He won’t name names, but Bennett says many or non-paying internships, which handicapped tech and social media companies work on trying him when it came time to apply for jobs post-grad- to burnish their reputations only when things go uation. “Through these internships, people were wrong. “But by then,” he says, “it’s too late.” landing interviews at places where they told me I didn’t have the experience. Well, how was I going to get that?” When a job came up at the Save-On head office in Langley, B.C., Bennett put in his resumé. “I TS

TIS knew everything about that company,” he says.

AR “I’d bagged groceries, done merchandising in the By Bennett’s telling, if someone—anyone, really— store, been an unofficial shop steward with the USIVE

CL had spotted his potential, he might have stayed in union. I knew what motivated their staff.” If he’d Canada. gotten the job, Bennett might have ended up track- His grandfather was a lumberjack, his mom ing his brother’s career (Shane manages several ZEMPEL/EX

Y a letter carrier and his dad a fireman. “Nanaimo London Drugs stores in B.C.’s Okanagan Valley). was a place where you knew everyone, with a real But they turned him down. EMIL working-class pride,” says Bennett’s older brother, To dull the pain of rejection, Kelly went to visit Shane. Kelly was a hockey player with worldly a friend in London, England. “I planned on staying OOMING ambitions: Shane remembers a map that hung on a couple of weeks,” he says, “but I stayed 13 years, GR

JUNE 2019 / REPORT ON BUSINESS 25 mostly because I met a girl on my first day there.” (She’s now NETFLIX SPENDING ON ORIGINAL CONTENT ( HBO) his wife of 20 years, Dominique, $15 with whom he has three chil- NETFLIX MARKETING BUDGET dren.) Despite his lack of expe- ) rience, Bennett landed a suc- S. 10 cession of jobs in advertising, a U. field he took to at once. “Nobody 5 cared if I had experience, and I had a sense that it was my call- (BILLIONS ing, that this was something I 0 17 16 19 could be really good at,” he says. 18 20 20 20 His North American pick-me 20 attitude helped. At one job, in the London office of a U.S. agency, NETFLIX HOURS OF whenever an executive would ORIGINAL CONTENT 2,000 ( HBO) ask for help, “Here’s me, this 25-year-old saying, ‘I can,’” says 1,500 Bennett. “What I didn’t realize was that in a British workplace, 1,000 nobody will ever put their hand up and say, ‘I’m good at this.’ 500 They wait to be tapped.” He also wasn’t shy about div- 0 17 16 ing into new things. In 1997, that 18 20 20 meant the Internet. “There was 20 this new digital thing coming that interested me,” he says, add- NUMBER OF NETFLIX SUBSCRIBERS ( AMAZON HULU) ing that it wasn’t all that differ- 150 ent from offline marketing: “You still have to be a great storyteller 100 and figure out how to motivate ) humans to do certain things.” His social media cred got him 50 hired in 2003 at Warner Brothers’ (MILLIONS London office, where he worked 0 on the digital side of campaigns 17 16 19 for the The Hangover, The 18 20 20 20 20 Matrix and the Harry Potter series. The franchise Netflix originals about a boy wizard was just rolling out, and Ben- (top to bottom): the 1980s-set thriller nett’s team became an early adopter of Facebook, Stranger Things building what was, at one time, the most liked and (2016); 13 Reasons followed property on the relatively new social net- Why, which sparked work. The content on Facebook served up what an outcry over its portrayal of teen fanzines once did and more: a constantly refreshed suicide (2017); The To this day, Netflix bears the imprint of its two feed of behind-the-scenes tidbits, images of the Chilling Adventures strikingly different founders: the computer-sci- stars, the latest trailers, links to behind-the-scenes of Sabrina (2018); ence nerd Reed Hastings and the self-proclaimed stories and to online communities of fans—mostly and the superhero junk-mail king Marc Randolph. series The Umbrella teens, obsessing together. Academy (2019) Randolph came from a family of marketers. With each sequel, audiences grew instead of His great-uncle, Edward Bernays, was a pioneer declined, according to Bennett. The challenge in advertising, using the theories of another Ran- on the marketing side was to continue selling the dolph relative, Sigmund Freud, to persuade peo- films to fans as they grew older (along with Harry ple to buy everything from Lucky Strike cigarettes and his friends, who go from 11 to 17 over the course (targeting women by portraying the act of smok- of the series), and as the tone of each installment ing as a feminist rebellion) to bananas (appealing got darker and more mature. “We tried to realize to North Americans by photographing celebrities J.K. Rowling’s vision in the campaigns.” All told, eating them). the eight Harry Potter films have grossed nearly Hastings, meanwhile, has innovation in his $8 billion worldwide. blood: One of his East Coast forebears contrib- In 2010, Warner Brothers moved Bennett to Los uted to breakthroughs that led to the invention of Angeles, where he caught Hastings’s attention. As radar, the atomic bomb and GPS, working from a Hastings puts it, “Kelly came on my radar because lab attached to his New York-area mansion. of the incredible campaigns he’d done for some of “In its DNA, Netflix had an equal measure the biggest blockbusters at Warner.” of consumer insight—Randolph’s knowledge

26 JUNE 2019 / REPORT ON BUSINESS How Netflix took on Blockbuster, brought streaming to the world and became an integral part of pop culture

1997 Netflix launches 2002 Netflix’s IPO 2010 Blockbuster files 2016 Netflix 2017 Netflix 2019 With Disney in a strip mall in Scotts brings in $82.5 million for bankruptcy. Netflix announces its intention subscribers in the U.S. and Apple set to Valley, California, expands to Canada, to expand into 130 surpass those paying launch new streaming mailing DVDs to 2003 Netflix hits one its first international countries—minus for cable services, Netflix customers. It abolishes million subscribers market China, North Korea commits a reported the late fees charged and Russian-occupied $19 billion to produce by video stores, most 2006 Amazon 2011 Hastings Crimea original shows and an notably Blockbuster, introduces a video- proposes to shunt DVD- anticipated $2.9 billion then valued at $4.6 on-demand service. watching customers to to market them billion Netflix offers $1 a separate company, million to anyone Qwikster, but backs 1999 Netflix raises $30 who can improve its down after an outcry; million and starts its movie-recommending its share price $400 NETFLIX’S STOCK PRICE (NASDAQ) subscription service, algorithm, Cinematch. plummets. Netflix where members pay a The prize goes to AT&T starts streaming in monthly fee to access Labs Latin America and the 300 rentals. Hastings takes Caribbean over as CEO 2007 Netflix delivers its billionth DVD and 2012 Netflix enters 2000 Hastings starts streaming online northern Europe 200 offers to sell Netflix to Blockbuster for 2008 Streaming 2013 Netflix begins $50 million, an offer company Hulu opens streaming its first 100 Blockbuster declines for business major original production, House of Cards, a show for 0 which it outbid HBO 2013 2014 2015 2016 2017 2018 2019 and sense of empathy—and Hastings’s expertise At around the time Bennett came on board, on the engineering side,” says Gina Keating, the Netflix bid $100 million for the rights to House author of Netflixed: The Epic Battle for America’s of Cards, which starred Spacey as a climbing, Eyeballs. “Both were equal—the yin and yang of corrupt politician in Washington, D.C. Netflix the company, the art and the science.” believed the show was a sure thing, based on the Randolph takes credit for two of Netflix’s copious data it had collected from its subscribers: greatest early insights: first, that movie renters Fans of the original British version of the series, wanted a greater selection than any one bricks- then streaming on Netflix, also liked movies star- and-mortar store could provide, and second, that ring Spacey and projects created by the project’s they were thoroughly sick of paying late fees at producer-director, David Fincher. The company the local Blockbuster. He and Hastings charged was so sure it had a winner that Bennett’s team a monthly subscription fee to customers to rent crafted an early email to Netflix members that DVDs via mail (an innovation Randolph takes full confidently posted the title of the show and the credit for), choosing movies from a personalized message “Coming Soon”—just enough to intrigue web page geared to their movie tastes (an idea for the target audience, nothing more. which he shares credit with Hastings). Although Hastings has called Bennett his chief Hastings, who has a master’s from Stanford, cre- emotion officer, the ads produced on his watch ated the underlying algorithm, Cinematch, that have been notable more for their ingenuity and now powers the entire company. When Randolph playfulness than their appeals to feeling. A televi- left in 2002, Hastings took sole charge, relent- sion spot for House of Cards in the run-up to the lessly trying to perfect Cinematch’s accuracy in 2016 presidential election starred Spacey, then suggesting shows that customers will actually at the height of his popularity, and mimicked an want to watch. When he wasn’t satisfied it was actual presidential campaign ad: “This message doing the best job it could, he offered a $1-million approved by Frank Underwood.” (His charac- prize to any data scientists who could improve the ter has since been killed off following the sexual accuracy with which it gauged viewer tastes; the assault allegations.) prize was won by a team led out of AT&T Labs. A recent ad for The Santa Clarita Diet—starring But as the company moved toward producing its Drew Barrymore as a suburban zombie mom— own content, Hastings knew he needed marketing starts off like a promo for a new weight-loss muscle. Enter Kelly Bennett. “We knew our future regimen but takes a gruesome turn: Barrymore was increasingly global and increasingly depen- happily eating human flesh from a bowl, blood dent on creating our own programming,” Hast- trickling down her chin. To advertise its stand-up ings says. “That meant we needed a CMO who comedy offerings, it put up billboards around L.A. could take on these twin challenges of introducing stating simply, “Netflix is a joke.” As Bennett says, new markets to Netflix and then getting our mem- “People thought, ‘Who’s trolling Netflix?’” bers excited about shows and films they hadn’t yet On the social side, the challenge is to think heard of.” small. “Now, we say, How do you sum up your

JUNE 2019 / REPORT ON BUSINESS 27 campaign in a tweet?’” says Ben- the old-fashioned way. And so Netflix went to nett. “If you can be really precise where the viewers were, taking over an hour of about the story, you know you’re traditional television to air an episode from its onto something. In 20 years, ’80s-themed horror series Stranger Things, com- we’ve gone from a 30-second “We’ve gone plete with retro-style ads and newscasts to fill the commercial being the ultimate from a 30-second full hour. That strategy gave Netflix a subscription thing, or the single-page maga- boost and won an award for creativity at Cannes. zine ad, to making an Instagram commercial being It has also helped that Netflix is spending big to story that’s five seconds long. the ultimate produce shows outside the United States, includ- But it can reach 10, 50, 100 times ing in Canada, where it reportedly has about 6.7 more people in a moment than a thing to making million subscribers. This past winter, Netflix physical printed ad or TV spot an Instagram announced its intention to establish 250,000 ever could.” story that’s five square feet of studio space in Toronto and invest The social strategy also in- $500 million (Canadian) in production north of volves reacting to whatever’s seconds long. the border by 2022. It’s spending similar sums to happening online. Take Bird But it can reach produce work in many other markets. But even Box, set in a dystopian future this has risks for its image: “Locals are getting where demons visit Earth; to restive about this American company coming in, look on them is death, so the 10, buying up all the great artists and content,” Keat- characters wander about blind- ing says. “I don’t think Netflix has any bad will, but folded. After its release, a meme just by being there, they change the market.” arose on social media that had 50, While Netflix is certainly the leader in stream- people walking around blind- ing, it’s still only capturing about 10% of screen folded in what they called the time in the U.S. And it’s in for a fight. Disney is Bird Box Challenge. The Netflix 100 getting set to launch its own streaming service in response was deft and speedy: November (it already has a stake in Netflix rival “Can’t believe I have to say this, times more people Hulu, which has 25 million subscribers). So is but: PLEASE DO NOT HURT in a moment Apple. Amazon, meanwhile, has been bulking up YOURSELVES WITH THIS its Prime offerings. That’s in addition to competi- BIRD BOX CHALLENGE. We than a TV spot tion from the likes of YouTube, HBO, traditional don’t know how this started, and ever could” cable companies and the remaining movie stu- we appreciate the love, but Boy dios, MGM among them. and Girl [two of the film’s char- So far, Netflix’s defence against the coming acters] have just one wish for 2019 and it is that you onslaught seems to be to appeal to just about not end up in the hospital due to memes.” everyone. “Our members are super-diverse— “We’ve developed a strong voice on social everything from a parent who has pre-K kids, to media,” says Bennett. young teens, to adults, to sophisticated elites who To date, he’s had a princely budget to go at these want to watch the hundred movies they need to challenges—it has grown from $1 billion in 2017 to see before they die, to people who love documen- a reported $2.9 billion for this year —but he bris- taries—we have all these different audiences,” tles at the suggestion that it’s bloated. “The mar- says Bennett. “We want to be the pre-eminent des- keting spend may seem like a rather large number, tination for filmmaking and series.” but when you break it down, market by market, Ad Week writer Jason Lynch believes this is around the world, across 20 to 30-plus languages, Netflix’s strength: “It wants to be all things to all it’s quite manageable—if you look at how other people and provide a never-ending stream of new entertainment companies spend on a title-by-title content in pretty much every genre you can think basis.” Indeed, the marketing budget for Aveng- of, so its subscribers will have no need to seek out ers: Endgame was reportedly around $200 million any of its rivals.” (with the movie generating $2.5 billion in its first two weeks). The Wall Street Journal has estimated HBO spent $20 million to promote the final season of Game of Thrones. The biggest challenge for Bennett has been selling Netflix abroad. “In a traditional business, you Bennett, however, won’t be around to fight the expand market by market,” Bennett says. “You do streaming war. deep market studies, lots of testing about whether When he announced his decision to retire in there’s viability. We had done a lot of that in prior March—walking away with $19 million in Netflix expansions. But this time, we learned about the stock—he said he wanted to spend more time with markets after the launch.” his family and “to contribute more to my commu- Netflix’s uptake in Latin America’s biggest mar- nity.” He immediately decamped to the High Sier- ket, Brazil, was initially below expectations. For ras, in Yosemite National Park, with Dominique one thing, broadband Internet wasn’t widespread, and their kids (aged 11 to 17) to wrap his head which meant subscribers couldn’t stream shows. around the implications of his decision. Many were still watching local television shows A few weeks later, after his return from the

28 JUNE 2019 / REPORT ON BUSINESS woods, we spoke again. So, what does the next epi- the company that might explain Bennett’s will- sode in the Kelly Bennett show look like? “Given ingness to depart. Hastings has said publicly that that I’ve achieved really everything I set out to one day, he wants to spend nothing on marketing, achieve professionally, it’s time for me to refocus,” letting Cinematch do all the work steering view- he told me. He has already accepted a seat on the ers from one binge-watch to the next. (Indeed, board of the German e-fashion giant Zalando, and reports have been circulating in the trade press he hopes to join the boards of a few non-profits, that Bennett’s team is being disbanded once he particularly ones with environmental and educa- departs—a rumour Netflix denies—and Stephen tional missions. He even mused about teaching Bruno has already quit to become MGM’s chief a marketing class at a local college. Though he’s marketing officer.) The algorithm is something of lectured in the past at Oxford and Stanford, and an in-house god at Netflix. But for his part, Ben- could probably land a more prestigious teaching nett told me in our first interview: “I don’t think gig, he’d prefer to join the sort of place where kids it’s realistic to imagine that we could ever get without much money—kids like he once was— totally out of marketing.” would study. Post-announcement, he’s more plainspoken: As for politics, Bennett has been known to give “A n algorithm will never really understand the messaging advice to Barack Obama. So will he human connection to movies, the universal truths be offering help to any of the candidates in the in them,” he says. “A lgorithms are not evolved yet upcoming 2020 presidential campaign? “No. No to predict why people like the things they like.” interest,” is his curt reply. He’s not leaving one He ends our interview with a summary of the hurly-burly to dive right into another. thoughts that visited him in Yosemite: “Something Looking back on his seven years at Netflix, Ben- that big reminds you of your place in the world. nett says it has changed the way he thinks about There’s great beauty, great adventure. Being with marketing, perhaps aided by Hastings and his your family in a place like that reminds you that Cinematch algorithm: “When I started, I thought there’s more to life than just your career.” advertising was 90% art—great creative, great After some time away from this game, will the images, great trailers, great storytelling—and 10% marketer in Bennett beckon him back? For now, analytical. Now, I think it’s 60% art, 40% science.” his answer is no. But time can alter our views. That could be a friendly nod to his data-driven What looks like static wallpaper one moment can soon-to-be-former boss. But a longtime Netflix morph, with the flapping of a butterfly’s wings, observer confirms there has been tension within into something different, less fixed, the next. Congratulations to these recent appointees

Matthew Hunt John Gorman Denis Dubois Jean-David Tardif Phillip Crawley, Publisher to Partner, Toronto to President and to Chair of the Board to President and & CEO of The Globe and Bennett Jones LLP CEO CANATICS Chief Operating The Canadian Officer Mail, extends best wishes to Nuclear Association Cascades the following individuals who were recently featured in the Report on Business Section of The Globe and Mail newspaper. Congratulations on your new appointments.

Michael John Coté David Bacon John West Stephen C. Ruschak to President to Senior to Senior Advisor to Chief Executive To make arrangements for an Appointment DCM Vice President Norton Rose Officer Notice, please call 1-800-387-9012 and Chief Financial Fulbright The Guarantee Officer Company of or email [email protected] Extendicare North America View all appointment notices online at www.globeandmail.com/appointments JUNE 2019 to to ou and fe C- and co the Bu lea glas look Me we pa smashed By 30 Wher JUNE By male mp rit suit t co finall t der re 20 no n and 19 bo wh s look a speak / It y JO at rpor REPOR still DA ce supposed anies. ANNA w, male es ’s ship WN ar e in ST at T busines ex y ON CA iling PA EV 2019 ar dr fe BUSINE LLEJ CHNER E of ar co bring at BREAR thr domina it clusi A male e ooms with SS ound: positions. e Ca rpor all will TO We all ough . N and Ca y— na ve the s equalit na ex to lea ta at ta dian lea and te re da to e ke ke ecu da the ha wo ding ached der ta fi a ve nd ti men y s— ve s ?

PHOTOGRAPH PHOTOGRAPH Is Chair need re and Th ev caps limits. ab ne if financ and lots needs. and long ye quot not a join an fe their if ent independent or sa bo and tha bit male bo bo In y, ne alua ar le w ar ad is e t ering abelle nec “W of tha kno as ex s; them. er re ar ar wa d? re sue Ca as, to sp of dir opting of member to e. ses af ds ds ting quir perienc al wo In Is co ac I e ge dir help na l. t Ca es bu co ect wl te I’ an hope means need is ne Bo the es opened we nsider sing Fr t sa d men da, nadian ect r t nst edg sue e enough y their or be w thr anc tha ril ar and te re on dif mor co by offi at pho Is we or dir antl te ge s ds y and eab chnologies co this e ve is abelle ough ar re t, fe e, CP mor tha mp s El nur thr re ed on ce og still to ect dir Pa rpor ev yo bo might ry e. e fr Courville wo re ys legisla up y le gu gr Rail’ trust in cap cific [long eshing t ra an ough to wo e Af eryw the ev nt u e ar ect or surprised e aphed fr Courville in uldn te Ca Bouvier lar lots we phies at ar at y oft d be ol . te s ont skills men ab rm or Bo IT lgary he Railw e e ly need 12 ve, r re tha tion -time en, her an le s no ’t of all, ad — ar and n’ be t to ds t e ay “A ny country that adopts a quota system forces board renewal, because otherwise, you can’t get enough new director openings”

director’s] expertise not be many female qualified women for at the table.” Okay, the candidates who can fit. the boards on which I person can stay on as an You need to build in serve. Canada has lots of adviser, but they can no some flexibility in terms associations that promote longer serve on some key of candidate criteria and female directors. I committees. Fifteen or then, through a solid personally maintain a 20 years on a board is too onboarding process, list of potential female long. Any country that invest in the people candidates, and when adopts a quota system who join your board. I’m asked to join a board forces board renewal, Each of us builds our but can’t do it, I pass because otherwise, you own credibility in the on my list. And female can’t get enough new board arena. I have board members really do director openings to been very coherent in serve as role models. If meet those quotas. how I focus my board you want to have more Board chairs and work: in regulated, women on your board, nominating committees capital-intensive, appoint a woman as also need to be careful B2B companies, often chair of your nominating when creating job unionized. I’m an committee. We have descriptions for new engineer and a lawyer, our own networks directors. If you say and I understand those of interesting female something narrow like, industries. colleagues, and when the “sitting CEO in the same I’ve never had any board is diversified, it industry,” there may difficulty finding really sends a message.

BOARDS BY THE NUMBERS Based on data compiled by the Rotman School of Management on 289 companies on the S&P/TSX Composite Index

Percentage of female 2008 9.8% 122 2008 directors on S&P/TSX S&P/TSX 2013 2013 Composite Composite 13.1% 88 boards with no boards female directors 2018 24% 6 2018

ONE 31.8% Canadian boards by number of female TWO 27.6% directors (2018) THREE 21.8% Percentage FOUR 8.4% 62% MALE of newly appointed directors on FIVE+ 7.9% 38% FEMALE Canadian boards in 2018 NONE 2.5% 13% VISIBLE MINORITY

32 JUNE 2019 / REPORT ON BUSINESS Kathleen Taylor

Chair of Royal Bank of Canada and former CEO of Four Seasons Hotels & Resorts

I’ve been on this journey from the first roundtable on “comply or explain” legislation, where we thought we had found the secret formula for making big things happen. That has turned out not to be the case. The slow pace of change on both gender and non-gender diversity on boards has been a surprise. Having said that, we’re starting to see the institutional investor community bring their voices to the fore, and I think that will prove to be a watershed moment. When we launched comply and explain, someone told me board diversity was “not really on our agenda.” There’s been a sea change in that view, because major institutions have come to the table and said: “Diversity of gender, background and experience brings huge value to the corporation, and now we’re going to use our voting power to institute some changes.” CPPIB, BlackRock, the list goes on—if you have no women on the board, it means you’re not taking diversity seriously, and we’ll vote against your governance chair. And next year, we will engage more directly. Before we start looking at quotas, I’d like us to focus on targets. What gets measured gets done, but we don’t actually say what we’re going to achieve. We say it about sales targets or earnings-per-share growth—how about measuring the most important asset, which is people? Some say targets are the same as quotas. They’re not. Quotas are rules. Targets are aspirational. We set reasonable milestones to get there. Look at the 30% Club and the impact it has had overseas. When the idea took hold, everyone moved toward it. It gives everybody a road map.

Kathleen Taylor photographed by Geneviève Caron at the Royal Bank’s headquarters in downtown Toronto

JUNE 2019 / REPORT ON BUSINESS 33 CAROLINE CODSI COGECO COMMUNICATIONS 57.1% Companies with the Founder and president of Women highest percentage SAPUTO INC. 50% in Governance, dedicated to of female increasing female representation directors SIENNA SENIOR LIVING 50% in the corporate sphere (2018)

LAURENTIAN BANK OF CANADA 45.5% Why aren’t women moving up? Let me start with the reasons that belong EXTENDICARE INC. to women. Women underestimate 44.4% 40% VALENER INC. themselves. They don’t talk about CP RAIL their achievements, or ask for pay 44.4% 40% TRANSALTA CORP. increases and promotions. A guy will CIBC say, “I’ll wing it at the meeting,” and 43.8% 30% ATCO GROUP a woman will say, “I need to read all night.” This is why, when you add 30% INDIGO BOOKS & MUSIC women to the mix, you bring up the boardroom’s depth—because the 25% LUNDIN MINING men around the table are like, “She’s done her homework.” Percentage 24% S&P/TSX COMPOSITE AVERAGE As for organizations, they need to of female directors at understand they shouldn’t be doing LINAMAR CORP. 16.7% select companies with a female CEO 10% PERPETUAL ENERGY

COMMUNICATIONS SERVICES 33.2% Percentage of women UTILITIES 31.7% on boards by sector CONSUMER STAPLES 30.6% in Canada

HEALTH CARE 27.9%

FINANCIALS 27.8%

INDUSTRIALS 27.7%

REAL ESTATE 23.1% this to please women. They should 40.8% FRANCE MATERIALS be doing this because they want to 20.5% make money. When you’re Reitmans 35.8% ITALY and you have 11,000 employees, CONSUMER DISCRETIONARY 19% 80% of them women, and maybe 33.7% FINLAND 95% of your clients are women, you ENERGY 18.6% don’t think a woman would help 28.7% AUSTRALIA your strategy? After all these years, IT 17% Reitmans ended up adding one 26.8% UNITED KINGDOM woman to its board. AVERAGE 24% As for the government, I’m pro- CANADA legislation. Not because I want an 25.8% easy way in—I’m as competitive NETHERLANDS as the next girl—but because it’s 22.1% not happening naturally. European countries that have imposed quotas 21.7% UNITED STATES for women on corporate boards have hit those targets. But here in 21.3% SWITZERLAND supposedly progressive Canada, among all publicly traded companies, GERMANY 20.9% Women’s global according to data from the Canadian representation INDIA Securities Administration, we have 13.8% on boards by 14% of board seats held by women. country (2017) There are 211 publicly traded 5.3% JAPAN companies that have no women at all. Their excuse is they can’t find qualified women. But if they had 80.5% MALE EXECUTIVES no choice, of course they’d find Gender representation among executives at publicly traded Canadian firms competent women. My line is, “When 19.5% FEMALE EXECUTIVES you legislate, you find women. When you don’t legislate, you find excuses.”

34 JUNE 2019 / REPORT ON BUSINESS MAKING CONNECTIONS

We look at 24 female directors to see where they intersect and list their other corporate directorships (many of them also sit on the boards of charitable or non-profit organizations)

Monique Leroux Maureen Kemptson Darkes AIR INVESTISSEMENT QUÉBEC (CHAIR), ENBRIDGE INC., CN RAIL CANADA ALIMENTATION COUCHE-TARD, FIERA HOLDINGS, S&P GLOBAL

BANK OF MONTREAL Kathleen Taylor Elyse Allan (RBC CHAIR) BCE INC.

Sophie Brochu Maryse Bertrand ÉNERGIR BROOKFIELD ASSET METRO INC., GILDAN ACTIVEWEAR MANAGEMENT

Lorraine Heather Mitchelmore Munroe-Blum CIBC TRANS MOUNTAIN CGI INC. CORP.

CP RAIL

Karen Sheriff Annette Verschuren WESTJET AIRLINES CANADIAN NATURAL RESOURCES, CPPIB LIBERTY MUTUAL INSURANCE

GEORGE Katherine Lee Isabelle Courville WESTON LTD. COLLIERS INTERNATIONAL

NATIONAL BANK Isabelle Marcoux OF CANADA TRANSCONTINENTAL (CHAIR), Una Power ROGERS COMMUNICATIONS, POWER CORP. TECK RESOURCES NUTRIEN LTD.

Benita Warmbold Jane Peverett METHANEX PUBLIC SECTOR PENSION CAPITAL INVESTMENT POWER CORP. BOARD

Indira Samarasekera Jill Denham MAGNA INTERNATIONAL, MORNEAU SHEPELL (CHAIR), STELCO HOLDINGS ROYAL BANK OF CANADA MUNICH RE CANADA, KINAXIS

Miranda Hubbs SAPUTO Martine Turcotte IMPERIAL OIL EMPIRE CO.

SCOTIABANK

Barbara Stymiest Karen Kinsley BLACKBERRY, SUN LIFE INSURANCE SNC-LAVALIN

TC ENERGY Maura Clark CORP. Alice Laberge FORTIS INC. RUSSEL METALS

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WHEN MAGNA SHUTS DOWN THE GRENVILLE CASTINGS PLANT IN PERTH, ONTARIO, HUNDREDS OF WORKERS WILL LOSE THEIR JOBS. WHAT HAPPENS WHEN A TOWN LOSES ITS LARGEST EMPLOYER?

BY CHARLES WILKINS

PHOTOGRAPHS BY IAN WILLMS

JUNE 2019 / REPORT ON BUSINESS 39 Les Peters (previous page), who has worked at Grenville Castings for more than two decades, at his home workshop. Mayor John Fenik (left) has presided over Perth’s town hall since 2006 and was first elected as a councillor in 1997. The Tay River meanders through town (right). Another quiet night in Perth (far right)

foundry called Grenville Castings—“a real descent-into-hell sort of place,” as one employee puts it—located in a non- descript industrial park on the south side of town. Many of the plant’s 380 full-time non-unionized employees have survived for years there, under working conditions that include 12-hour shifts, unbearable noise, objectionable fumes, and interior temperatures that in sum- John Fenik was a teenager, during the 1970s, he worked mer can soar to 60°C and in winter drop nights at The London Free Press, stacking freshly printed to the freezing point, because the plant’s newspapers for distribution across the region at 5 a.m. industrial doors have been opened to It was a job he recalls with whimsical, almost mystic, dispel the heat from contraptions that fondness, because, for a couple of hours between his include vast masonry-lined “melters” in leaving work at sunrise on Saturday mornings and the which aluminum ingots the size of La-Z- point at which carriers plopped the newspapers on sub- Boys are liquefied at more than 700°C. scribers’ doorsteps, he alone in London knew what was From a metaphorical point of view, it happening in the community and in the world. “I loved may also help to know that the plant is it,” he said recently. “For a little period every morning, I one of the ugliest structures not just in felt I had this special knowledge and power.” the industrial park or in the town but, Nearly 50 years later, as he ate lunch on June 18, 2018, quite possibly, in Creation—a great Fenik, who is now the mayor of Perth, Ontario, got a barn of a place, clad in phlegm-coloured phone call that induced that same quixotic feeling, a pri- metal, topped by a forest of belching vate foretaste of what was about to transpire out there in the wide world or, ventilation stacks, and barnacled by more accurately, in the microcosmic world that is the town of Perth (popula- rusted appurtenances and a sheet-plas- tion 6,000), approximately 80 kilometres southwest of Ottawa. tic lean-to for resident smokers. The lot Whereas his boyhood clairvoyance had felt good, the current version was of it is surrounded by makeshift parking shocking and demoralizing. “When I hung up the phone, I was frustrated; spaces, Atco trailers, bunkers of scrap was angry. Immediately, I was thinking of things I should have asked or said.” metal and rumbling 18-wheelers whose Fenik’s unexpected call that day came from a man he identifies only as “a engines run constantly, adding to the senior executive” at Magna International, the hugely profitable Canadian- low-level toxicity that seems to surround based auto-parts maker—a company that operates some 439 facilities in 28 the building. The place has no grounds countries on five continents, the lot of them producing $53 billion in annual and has an all-but-morbid shortage of sales and nearly $3 billion in profits. windows, which perhaps more than any “They have all this wealth, all this success, all these reasons to be magnani- other factor suggests a neglect of what it mous about their place in the world,” says Fenik. And yet the message he got means to bring human beings together that day represented for Fenik what he later described as “this huge social under livable circumstances. and economic impropriety—to me a kind of major ethical crime.” The plant manufactures, among other To understand that alleged crime, one must first know that Perth’s biggest things, framing components and differ- private employer in recent years has been an old-style aluminum auto-parts ential housings for the likes of General

40 JUNE 2019 / REPORT ON BUSINESS Motors and Tesla. The work has been on their way to Perth, and that at 4:30 they would be addressing Grenville’s described as “a sort of a black magic.” workforce to let them know Magna was shutting the plant down for good.” But the phrase does not fully honour And the company would be skedaddling from a town that had treated it with the resident magicians, because low- more dignity and generosity than Magna was now treating the town. pressure aluminum casting—a process Fenik immediately summoned his executive team to the War Room—oth- few understand and even fewer can per- erwise known as the Sunshine Room—of Perth’s historic town hall on Gore form—combines old-world alchemy, Street; it is a room whose eccentric presences include not only the ghosts of metallurgical voodoo, near-masochistic the Scottish colonialists who built the town and of town councils past but self-punishment and hints of fine art on also of Perth’s annual Santa Claus parade, in the form of half a dozen large a level that sculptor Henry Moore would papier mâché heads that sit at the edge of a loft, peeking over the work area almost certainly have appreciated. like escapees from a Lewis Carroll nightmare. Besides which, it is perilously danger- “I called Magna back,” says Fenik, “racking my brains over whether or ous. A few drops of water in the melting not there was something we, as an administration, could do in the way of furnace can, in an instant, create a kind water costs or tax incentives, whatever, in order to save the jobs.” The mayor of hydrogen bomb with the power to acknowledges he was furious that he and his council had not been included in blow the roof off a place like Grenville the conversation to shutter the place. “I mean, we put a tremendous amount Castings. When a Bic lighter recently of effort and expense into underwriting these companies, in terms of making ended up in a melting furnace, it created a life, a culture, recreational opportunities for the workers and management, an explosion that, had things gone max- and their families.” badly, could have maimed half a dozen But Magna wasn’t budging, and Fenik says that as the afternoon wore on, workers. Machinists and operators are “the inevitability of it all became increasingly oppressive.” frequently required to service moulds operating at 800°C without even shutting them down, and employees say they What does a town of 6,000 do to give itself a fighting chance on have often ended up in the local emer- a globalized map in restless economic times, on a puny budget, gency ward suffering various traumas almost all of which is swallowed by mundanities such as polic- and contusions. ing, garbage pickup, and water and sewage treatment? How does it For anyone who has not guessed, survive trade wars and climate change and once-faithful industries Grenville Castings is owned by a divi- that have decided to trash their citizenship—and with it, just about sion of Magna International. And it is everything else they apparently once honoured in a community? not the physical ugliness of the plant On a day this past January, Fenik was in his office in Perth’s town that has been an issue in Perth in recent hall, contemplating that very riddle, discussing his town’s assets, months (although it might have been, hopes and challenges—which, these days, point about equally to given that Perth is considered one of the the future and the past. He is amused to hear that an online forum prettiest towns in Canada and is not par- has been debating whether residents of Perth should be called “Perthites,” tial to squalor). The issue, rather, is the “Perthlings” or “Pertherts.” socio-economic ugliness that, on the day Under any name, such residents are likely to agree with the mayor that, Fenik got his phone call, lurched out of despite a persistent deterioration of the manufacturing base, their town the factory and up Gore Street into town. remains a resilient, even extraordinary, place to live. In its attempt to tran- “What the Magna guy told me,” says scend economic vulnerability, in recent years Perth has also transformed Fenik, “was that company officials were itself into one of Canada’s most popular and accommodating places to die.

JUNE 2019 / REPORT ON BUSINESS 41 Les Peters (left) at his home 20 kilometres outside of Perth. Aluminum castings gone wrong await pickup so they can be shredded and remelted (right). Michael Groulx (far right), a 27-year- old operator at Grenville, will be out of work come June, when the plant shuts down

at the Perth plant. “I came home from work that afternoon and announced to my wife that this was the best job I could ever hope to have. Friendly owners. Great management. If you produced your quota of parts by Friday noon, they brought in lunch for everybody and sent you home for the rest of the day.” It was in 2000, during a major retool- ing to produce parts for a U.S. pow- Statistics show that 40% of the citizenry are superannuated seniors whose ertrain maker named American Axle, presence has fuelled Perth’s carefully orchestrated emergence as a “full-ser- that the wheels began to wobble. Lack vice” retirement community: health services, funeral services, cemeteries. of capital to purchase state-of-the-art Ironically, the town’s unofficial motto, “A ged to Perfection,” applies less to equipment for the new initiative neces- its human population than to the disproportionate amount of 19th-century sitated the sale of the company to what cut limestone in its architecture and the fact that virtually every downtown the employee calls a “bigger corpora- intersection doubles as a living diorama of Perth’s 200-year-old roots. tion,” which in turn sold to a consor- “We’re very definitely about history,” says Fenik. Which, in the wake of tium, which sold to another corporation. closures at factories such as Grenville Castings—and at Yarntex and Interna- “There were so many owners in that era, tional Scissors and Heritage Silversmiths and Brown Shoes—has become a you couldn’t name them all. Then came kind of survival strategy unto itself. History as tourism. History as commod- the crash in 2008, and the plant’s Ameri- ity. History as psycho-cultural elevator music for the long, slow descent of can owner entered Chapter 11 bank- the retirees. The joke goes that while nearby Smiths Falls is selling “stoned” ruptcy. And the company was bought (its magnificent new cannabis company, Canopy Growth, occupies the aban- out again.” doned Hershey chocolate factory), Perth is still selling stone. A mould operator recalls that by the But it is selling that stone with the same sort of passion that it once made time Magna International came on the and sold scissors and yarn and shoes. The words “heritage” and “legacy” scene in 2011, “things had reached a point bloom like petunias in the town bumph. Even the local plaza, a model of where some of us had the feeling they up-to-the-minute mediocrity, has been revivified as the horsey-sounding weren’t going to make it,” the employee “Perth Mews.” Ye olde municipality hosts a music festival, a maple festival says. “The plant got congested to the and a college program in heritage carpentry. The Perth Citizens’ Band, the point of chaos—one machine on top oldest of its kind in Canada, has been around since the mid-1800s, shortly of another, I guess to increase produc- after Scottish masons arrived with their chisels and hammers to reinvent the tion. The real problem, though, was that dwellings their forebears had abandoned during the Highland Clearances. headquarters never properly worked However, in a small-town economy, nothing can quite replace the secu- with our people. They just told us what rity that comes with factories cranking out goods around the clock, gener- we had to do. We’d do it, and it would ating wages and taxes and support jobs. And community life. And the idea mess up. And we’d get behind. And the of a future (even an unsustainable tomorrow is a tomorrow). Such was the pressure to produce would build. Oh, it bonhomie around Grenville Castings when its Toronto owner, Tritec Corp., was fierce. GM’s not going to sit around expanded it from Merrickville to Smiths Falls in 1992, and on to Perth in waiting for parts from Perth.” 1994. “I remember my first day on the job that year,” says a senior employee These days, thousands of finished

42 JUNE 2019 / REPORT ON BUSINESS parts are spread like Tinkertoys in giant jobs they are encouraging their castoffs to find. bins or on skids across every available The plan was that Magna would keep the plant open for a year—not for square metre of the company’s outdoor the employees but for the company, which had contracts to fill. Meanwhile, space as they await shipping. The under- Magna offered modest severance pay: one week’s wages for each year of ser- current of turmoil in the plant is perhaps vice, plus what Magna calls a “seniority-driven” bonus. “But we have to work best captured in the fact that Grenville to the bitter end to get that. We can’t leave a day early, even for another job. has had eight general managers in the And we have to shut up. No yapping to the media. Which means you,” said eight years since Magna bought it—and one worker to an inquisitive magazine writer. at some points has experienced as much A Magna representative confirmed in April that the company’s policy on as 70% turnover in personnel. severance eligibility is that workers “must remain in good standing.” As for the additional seniority payment, Magna said there is a “general confidentiality obligation” imposed upon eligible workers, but said there is “no specific predictably, the meeting reference regarding speaking to the media.” between Magna and the During the weeks that followed the announcement, a hundred or so work- plant workers on that fate- ers, mostly those without much seniority and therefore expecting little in the ful day in June 2018 rapidly way of severance, quit and took jobs elsewhere. The departees were replaced disintegrated into anger and by temporary workers bussed in from Toronto and Ottawa—some of them recrimination. A normally conspicuously unhip to Grenville’s life-or-death safety standards. “The rules soft-spoken senior employee were explained to them meticulously in English,” says one worker. “But some is said to have screamed from of them didn’t speak English. I saw one guy come into the plant with a can of the floor, “I’ve given my life pop and set it down near one of the big aluminum melters. In the old days, to this goddamn operation... he would have been fired immediately. It’s the equivalent of setting a box of and here I am being told that TNT on top of a wood stove. But nobody on the floor said a thing.” Magna I’m not needed anymore, that I’m dispos- declined to comment on the incident. able.” Others accused Magna of ruining As for the company-imposed silence, most of the employees obediently Grenville with its ineptitude and greed. lost their tongues. Those inclined to talk have sounded off anonymously “We’ve worked our asses off every day, about deteriorating plant conditions and eviscerated company-employee in this heat, in this terrible f—ing envi- relations. One worker speculated that when Magna bought the foundry, the ronment,” hollered one employee, “and company’s idea was to have its own technologists and engineers learn and this is our thanks.” perfect the plant’s “magic” and transport it to somewhere it could be done Within minutes, the meeting was shut more cheaply. “We had people from Poland in here studying what we were down for fear it would disintegrate into doing. Then there were people from China,” says a veteran machinist. “But violence, and the employees went home it’s not something you can pass on in a matter of weeks or even months. to ponder the stunning new narrative of In fact, in all these years, the people who’ve been observing and working their lives. In effect, it was a tale told by with us have really never figured it out! And Magna still doesn’t get it.” The an idiot. Magna, which claimed it “cared machinist explained that he and the operators used to design their own cast- deeply” for its employees, promised to ing moulds—fiddle with them until they were perfect. “We knew what we help them find jobs, plan for their futures were doing. Then Magna took that away from us, implying we were incom- and write resumés—this backed by an petent. Now we get these moulds from all over Ontario and the U.S., suppos- economy in which companies such as edly professionally designed, and they’re not right! They don’t work.” Magna are busily killing precisely the As a result, the employee says, the quality control has been “awful” for the

JUNE 2019 / REPORT ON BUSINESS 43 Janet Girdwood (left) works at a local chocolate shop and has seen other shutdowns decimate jobs in her community. The Perth Citizens’ Band (right), formed in 1852, rehearses at the town hall. Victor Saikaly (far right) dishes up lunch at his namesake diner, which he runs with his son, Keith. Mr. Victor’s Diner will lose a considerable chunk of its business when Grenville shuts down

jurisdictions. In other words, says Mayor Fenik, “to places where shipping is cheap, property is all but worth- less, taxes are not an issue, environmental standards barely exist, and you can’t live on the wages. Places like Mexico. Like China. Like parts of the United States of America.” While Magna refuses to say where it will be making its castings from here on, it has been oper- past few years. “Five years ago, it would have taken us a week or more to fill ating in all of those countries for years. the 53-foot scrap Dumpster at the plant’s south door,” says the worker. “Now When the company declared it would we fill it eight times a week!” be “rolling out” its severance package, Historically, Magna’s inclination has been to say nothing to the public one employee complained, “You’d think about plant closures. But when informed of the reported chaos at Grenville, by the way they talk we were gonna have company representatives agreed to speak to Report on Business in the hopes some major avalanche of money coming of lending perspective to the reports from employees. But they would do at us when, in fact, if you’re like me and so for reference only, not for attribution. In that mode, they explained that have only been there nine or 10 years, it’ll the creation of excess scrap—which, incidentally, is shredded and recycled be, like, $8,000 or something—hardly through the melters—is an inevitable result of the introduction of new enough to prolong the agony.” machines and processes, and increased production. (“Yeah, and bad tools Magna is adamant the closure of Gren- and faulty moulds,” counters one casting technician.) They declined to com- ville is not related to aluminum tariffs ment specifically on the eight-fold increase in scrap. imposed by the U.S. But they are quick to In the same vein, Magna said it had no intention of moving the plant when acknowledge it is “tough times all over” it bought it. There was even hope for an expansion, when Magna bought an in the auto industry. GM, for example, is adjacent soccer field owned by the town. But to this day, it is used for soccer. in the process of cutting 2,300 jobs from Otherwise, Magna’s communications since the announcement have been its Oshawa, Ontario, operation. “Mind a kind of drift, an Orwellian seepage, that might be read, indirectly, as a you, it’s exciting times too,” said a Magna condemnation of the very kind of capitalism the company has practised on rep, whose company has invested heav- Grenville Castings. It might be read less generously as a menu of brazen ily in producing a kit that will convert corporate euphemisms for the New Age. The company claims, for example, conventional cars to self-driving mod- to harbour “a great empathy and concern” for its workers. “I guess there’s els. But as The Guardian columnist John some respect there,” says an employee. “Unfortunately, they don’t respect us Harris asked: How long will cars as we nearly as much as they respect their investors and their need to make money know them even exist? The supposition no matter what the human cost.” is that the future of transportation lies As for the reason for the closure, Magna insists “commoditization” is the less in privately driven autos (on which major culprit, which in market-speak means auto parts such as those made some cities have already imposed selec- in Perth are interchangeable with similar parts made using similar processes tive bans) and more in high-speed mass by any number of companies—and must thereby be sold competitively. “No transit, like light rail, which is in fact a value can be added,” says a Magna rep. “A nyone can make them.” projected centrepiece of Fenik’s vision Which is why, of course, the company must decamp for lower-cost for the future of Perth.

44 JUNE 2019 / REPORT ON BUSINESS this free-for-all of non- be vulnerable to the shifting industrial climate. “We wouldn’t be able to help attributed commentary, him either, if he should lose his job,” Les shrugs. Tracy, a medical secretary, one Grenville employee, has contributed heartily to the family finances, but she is now disabled by ill- a 52-year-old machinist ness and has been in and out of the hospital in Ottawa for the past two years. named Les Peters, spoke Her current regimen of 12 medications is covered largely by Les’s company fearlessly, openly and on drug plan—which is, of course, about to lapse. “I look at my pills,” she says, the record about the effects “and I think, Okay, maybe I can do without one or two of them. I could take of the plant closure on the chance.” him and his family. Peters Tracy says what bugs her as much as “the big things” is the way the impend- lives with his wife, Tracy, ing shortfall grinds away at the sort of grace notes that give margins and plau- and their 24-year-old son on a wooded sibility to a life. “I get asked if I can contribute a toonie to a local charity, and I acreage in the verdant Brooke Valley, say, ‘Well, no, I’m sorry, no, I can’t. Not today.’ Do you know how utterly shitty 20 kilometres west of Perth, where his and deprived that makes you feel?” ancestors put down roots in 1813. Les is For years, Les has saved money by joining with neighbours to cut firewood, a soft-spoken, self-described obsessive- for example, or to raise buildings or shovel snow—basically to get the ben- compulsive, who began work at the efit of shared or exchanged labour. He is, among other things, a talented (if plant in 1994, and for much of the past uncertified) automobile mechanic and has dreamed for a decade of running 25 years he has used his skills as a tool a modest repair and machining facility out of the barn-sized shop he built in and die maker to construct parts for the the trees, on the high ground, behind the family home. He does occasional plant’s machinery and otherwise keep repairs on neighbours’ vehicles and farm machinery. “But I’m not quite at the the machines running. He has applied point where I can go it alone,” he says. “It’d be a pretty limited income at this his wages, which today sit at just over stage. I feel I should probably hold a job for a few more years.” The problem $30 an hour—roughly $63,000 a year—to is to find a job—one that suits his skills and temperament. “It’s not easy at buying the land where the family lives, my age. Plus, I’m not keen to leave the valley. I just feel I’m a little too old to to paying the mortgage on their unas- abandon everything we’ve built here.” suming house, raising two children, tak- Les’s situation at work these days is even less sanguine than it is at home. ing modest vacations and keeping a suc- As a devoted and highly skilled machinist and an intuitive mechanic, he is cession of what Les calls “decent used constantly called upon to fix machines, make parts, solve problems—this, in vehicles.” He and Tracy have no savings an environment that is increasingly hectic as the plant stumbles toward the to speak of, and Les’s severance pay is finish line. “Even before I’m through the door,” he says, “I have people asking likely to max out somewhere just above me to help them do this or that—in addition to the long list of other jobs I $30,000, minus deductions. can’t ignore.” This has him worried—partly for his The subject infuriates Tracy. “I keep telling him he mustn’t do it; he has own sake, but more so for the sake of to guard his health, to tell these people that he’ll put them on a list and help those around him. For one thing, he says, them if he has time. He’s been loyal and committed to this company for he will be unable to help his 21-year-old decades, and he’ll be loyal to the last minute. And why?” daughter repay the $60,000 she owes Tracy leans toward her interviewer and says quietly: “Les has worked sooo in student loans. His son works at a hard.” Her words fall somewhere between endearment and condemnation. machine shop called Bell’s Machining, “The guy is exhausted with the stress.” Welding & Hydraulics, which does occa- “I can’t say no,” responds Les, whose old-world allegiance is to co-opera- sional contracts for Grenville and could tion and community—perhaps too often at the expense of self.

JUNE 2019 / REPORT ON BUSINESS 45 Les and Tracy Peters, and for many Grenville employees, the months of the handful of small factories—an since last June have been rendered all the more galling by the fact that electrical components plant, a wire fac- Magna’s founder, Frank Stronach, and his daughter, Belinda, engaged tory, an adhesives manufacturer owned in a business spat so boisterously public, and involving so many bil- by 3M—that are holding their ground in lions of dollars, as to make the TV serial Schitt’s Creek (a satire on Perth. His dream, he says, is a high-speed small-town facsimiles of the Stronachs) look like an enactment of light-rail system that would deliver com- the most boring statutes of the Old Testament. “Their fight isn’t even muters from Perth to Ottawa in 40 min- about Magna,” says Les. “It’s about their other company, the Stronach utes and to Toronto in two hours. Group.” But it is nonetheless a reminder to Grenville employees that For Perthlings such as Les Peters, the as they fight to save their $900-a-month mortgages and find minimum-wage future these days has more to do with jobs, their struggles have made a few people (to use the words of a dissident quietly contemplating the survival of his Grenville administrator) “insanely, even brainlessly, rich.” family and of toughing out his final days Some employees were irked in a different way when, in mid-February 2019, at the plant. the British rock star Sting, who was performing his musical The Last Ship in “I’ll keep givin’ ’er to the end,” he says. Toronto, volunteered to perform it in Oshawa, in support of the unionized “I’m not angry, just very frustrated and employees being put out of work at the GM plant. The production chronicles exhausted over the way things have gone. the closing of the shipyard in Sting’s home of Wallsend, England, during the And I guess, in a sense, I’m relieved that 1980s and the catastrophic consequences for the city’s residents. “I love Sting, it’s over. To tell the truth, I was relieved and we don’t begrudge them the support,” says one veteran Grenville worker, the day Magna announced the plant was “but in a way, hearing about such things just makes you feel smaller and more finished. With all that was happening, I helpless, because of course Sting’s not going to perform in support of a crappy just couldn’t see how it could go on— little non-union plant like ours. Why should some guy we don’t even know couldn’t see how I, myself, could go on recognize us when we’re not even recognized by our own company?” in that environment.” Meanwhile, of course, hundreds of local residents have made it their busi- Tracy Peters is not so forgiving. “If ness, their concern, their survival, to recognize the importance of Grenville you happen to mention me in the story,” and its employees—to understand the blow that will be dealt to the commu- she says as she listens to her husband, nity when the castings plant is gone. “They say six jobs are affected for every “would you kindly refer to me as ‘Les’s primary job that gets smoked,” says Keith Saikaly, who, with his dad, owns embittered wife, Tracy?’” Mr. Victor’s Diner, within a hundred metres of Grenville Castings. “A nd, of On a morning in early spring, a Gren- course, the city loses taxes, and the landlords lose tenants and the stores ville floor manager who identifies him- lose customers.” Mr. Victor’s will itself lose some 25% of its clientele. “There self only as “George” sits in Mr. Victor’s are mornings when I deliver as many as 50 takeout breakfasts to the plant,” Diner after leading a company work- says Saikaly, who anticipates rough days ahead, but feels he and his dad will shop in the X-raying of castings, a pro- weather them somehow, with adjustments. cess whereby flaws can be detected in Janet Girdwood works the counter at Perth Chocolate Works on Wilson the metal. It is part of Magna’s attempt Street. But she was once employed at the Rideau Regional Centre, a mega- to prepare Grenville’s employees, or at institution for people with developmental challenges, in Smiths Falls. When least a few of them, for opportunities of the centre closed about a dozen years ago, more than 800 regional residents the sort Magna is about to snuff out for- were put out of work. “This was around when the Hershey plant closed,” she ever in Perth. “Most of us will turn up says. “A lot of Perth people worked at each place. Oh, it was a disaster. These somewhere,” says George. “I may look sorts of things affect schools, community programs, real estate. Members of like a foundry worker, but my main love my family had a health-food store in Smiths Falls. It was over very quickly is astrophysics. Who knows? Maybe for them. And, of course, new businesses won’t come. The money is leaving.” Magna will head off into space, and I’ll Girdwood’s 22-year-old daughter, Cal, recently opened Koolz Vapes in apply for a job out there.” Perth, many of whose customers work at Grenville. “These people are work- The more likely scenario is that Magna ing stressed,” says Janet. “A nd when that happens, they have more accidents; will continue its migration to countries their sense of community deteriorates; there’s a more destructive energy such as Mexico, China and India. “Con- around them. Grenville is a very tough place to work at the best of times.” trary to what you might think,” says one All of which circles back to the question of how a town survives, both Magna administrator, “I’m sorry we’re socially and economically—to issues such as the promotion of Perth as a leaving Perth.” retirement haven and the repackaging of the town’s history as a consumer A year ago, most of the local workers item. The problem with the former, as Saikaly points out, “is that the selling felt much the same way. These days, as of retirement is as economically unstable as the manufacturing of car parts.” one employee puts it, “We’re just bloody For one thing, the cohort of baby boomers on which retirement communities glad to see them off.” feast will not be around forever. And old folks on fixed incomes are unable to create growth. Plus, young people, unless they are in health services, are Editor’s Note: In the hours before this story went inclined to move away from a town devoted to long, comfortable dying. to press, Les Peters revealed that he had left Gren- It is for all of these reasons that Mayor Fenik, while deeply appreciative of ville Castings and taken a job alongside his son, the town’s past, would be happy to make a little more of selling the future— Riley, at Bell’s Machining, which makes firewood particularly to the town’s youth. In that regard, he and his council have been processing equipment just a few hundred metres integral in bringing state-of-the-art fibre optics and communications tech- from Grenville Castings. He will receive his sever- nology to Perth, and have facilitated the renewal of Algonquin College’s ance pay from Magna and hold on to his benefits 350-student campus on the edge of town. Fenik is also an avid proponent until the plant closes in June.

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FEATURED JOURNALIST The July Portugal River Cruise begins in the city of Porto, famous for ERIC REGULY its Porthouses, vibrant restaurant scene, and breathtaking views

Eric Reguly is the European Bureau Chief for The Globe and Mail. Based in Rome, he’s covered economic, ﬁ nancial and geopolitical stories including the euro zone crisis, the bank bailouts, the rise and fall of Russia’s oligarchs, the Arab Spring, the migrant crisis and the rise of European populism. Reguly is one of The Globe’s journalists who will be on board the upcoming Portugal River Cruise in July. Learn more at GlobeandMailCruises.com

You were on The Globe’s in my European career and performance of the Pope’s stopped for a day in Lisbon. All French River Cruise last year how austerity, populism, own choir. Last year, in France, I remember was the Tower of and you are on board again political fragmentation and the we had a spectacular dinner Belém, the fortiﬁed tower on this year for the Portugal one. migration crisis have turned in the medieval Gothic papal the water that was built in the From your experience, what the continent on its head. palace in Avignon. I can’t wait 1500s, and the delicious food. makes them so special? to see what unique access the The river boats are small and What are your favourite Portugal cruise organizers will Is there a spot you are intimate − but absolutely memories from the have in store for us. Whatever most excited to visit on the sumptuous − and everyone previous cruises? they are, I guarantee they Portugal cruise? gets to know one other pretty My favourite memories are of will be remarkable, once-in-a I am looking forward most to fast. In last year’s French river the exclusive access to some lifetime experiences. Also, the seeing Porto. I am no fan of cruise, I found the guests of Europe’s greatest artistic meals on both cruises were modern architecture and the friendly, enthusiastic and and historical treasures that knock-out delicious and always city seems to have preserved curious − truly engaged and were arranged by the cruise varied. its historic centre exceed- opinionated Globe and Mail organizers. A decade ago, ingly well. From the photos, readers, many of who have in the Mediterranean cruise, Have you been to Portugal I love the colours - especially fascinating careers and all we had the Sistine Chapel, before or any of the spots on the burnt yellow and reds. whom share a great interest in the Vatican Museums, this River Cruise? Of course, I am also looking in history, architecture and to ourselves − it’s normally The last time I was in Portu- forward to downing a glass or cuisine. It was a delight yak- packed and noisy. If that were gal was in the 1970s, when I three of the famous Porto forti- king away with them and they not a rare luxury in itself, we was a kid. Our transAtlantic ﬁ ed wines. Will it be bad form seemed genuinely interested were also treated to a special ship from Naples to Halifax to drink them at breakfast?

DOURO RIVER – JULY 31-AUGUST 7, 2019

Behind-the-scenes perspective, exclusive luxury experiences—all on board our privately chartered river cruise. For more information, please visit GlobeandMailCruises.com set institu called being to - - 48 - - - - ac is and list yo of My her home sorts being Ye ther Our My Th I I I not co CE ung wo gr re us us t, ting ening JUNE da e BA e wh he aliz Da ew unting dad kids—in as rk older yo of O Na wa the deserv ab mom. d er tion, Fr , wa at 20 ed up vid unger ed a up of and wa tr le s agile me: wa to 19 societ I ag most s ne summer the a the to in s br co / a bu Azrieli. fo the s edies then number REPOR lar She ve es “Shu ot a fe do uld born r X. me t fo pa ve r Azrieli ge minist her pr omi fun the a y peop unda a something ev rticular My ry lif do to go opert r T wa and t question s in y ON than entuall wa up thing e wa t . help Danc fo ne pa of s le Sometimes 19 of a tion, BUSINE s ve ad r bef and rm, mast Fo ve y re ar ye 22 born dignit my lif , ry ve manag peop La to ound nts our r or ar unda . er y e. tr tha be He ev ntur int SS fa s of e do er st because we ad . He we with ago, ther en tha Vo aca quiet y. t ’s le me ent survi Wo . itional nt me. I Bu es Azrieli tion. ement Eve re and wa co actualiz lun ha t demic tha ’s ba rd and wh became on a bef t to nsider s d I fo I ve ry re de ck te t became ex wo ld we learned to en sho Sc or meant r al one fa d my —wh ve er ce to a to find e the uld mil pur est my we ion e . sec lopment wing ptionall ed he school pu Sc tw has tha a at y, re suits. wa sa ich, da ond. some thing. it. go t of o I ienc a e a with t him y wo wa cap d sist libr wh r, co t lot. cap Eve de to I and to and ” sn and men. mp y will al at e acit er arian. the ba in ve a acit Fo ry Ca supporti ’t ner dis s I st I an lanc ha an al loper r finished kne human not y. na te we ay y. him, Ne abilit wa y. d d It ll da. -a re e, I all w ’s yo ve ys t- did up ve r. u, y until because seriousl co mean ha my majorit us to wo peop as can in under am scienc Th ------support. ye is re my we Th Fo Mo I Ca I is sear sumed the t, mbina d lo alw the $85 the rl launched. ve da fa r int e nada chang pa to ve st d my le nine ther co ervie thr ry ay st d onl br ch million e, with lar rticular err of the ar y and just nti y, s ain. pa so int I tion ea I of and punche ge y fo our e . w wa co and e or on am Ho nu Wa re financiall thinking d I r er has tha st wh the the did uld Some wa nt ce nts 10 tha at ar of the ar est locaust He fo ve rr ly ev I’v been ed t, at nturies, ion ea chit wo and sn en it disor danc unda , co t ry ed ery fo s let e it side he wa go s to and ’t abo Buf co r me rl of of edit pa wa of in ectur enc me still es yo abou be cr s d. ye y. e me tion der we tha ss educa imp also ve of scienc fe didn s ed ea to and ung thr ar a our te is iona al tt alth ha mor and its te t ba . doct e, wo my t wa ll act not in ough Yo is and ve er their d ve ’t martial ag in ck yo we tion co te rk co Ca ys wa u e ove mak e br ry scientists, ha ed or, a music as ndens u. to in can or abou Bill nnect ight ev bet other na lot s ev int ve sumed leg /Int r to wa bu something ge lef e ery les da. ge erything te er do to their Ga a ed. arts. go acy ner t in s t t ervie s, ner r big and I ed est incr one to da We do has. te Re a br to wa int do al in an lot y s philanthr to ed at ad . it’ ain deal ro be w the I sn o and, Gi easing gr at of mor ions, ymor te mor s wa used ots in medicine. of by ’t ant we ge ving oft se re rms the called arts. of to nting scientific e go Kris e—and ner sear specificall ve in en at do wh $80 p e. it. to fir od tha of n Pledg the tg in op ous. ty . har Mo Ed st Th ch, and ich danc am. ho Ni in to million t ma Wo y, uca pr wishes pool. d re e ca Bu I a—a w the bet and wa making If e. st og to th uds don va /r e the tion yo t ay y, Bu s ve te st ra ge or I tr u ’t r y ry ms t t a of

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