Globe and MailCanadian CEOs view their companies as world class: poll
By RICHARD BLOOM
Wednesday, January 21, 2004 - Page B1
Barry Heck, president and chief executive officer of Westaim Corp., says his company "absolutely" has what it takes to go up against the world.
Indeed, Mr. Heck is among the vast majority of Canadian CEOs who say their companies have "what it takes" to compete on the global stage,
According to this year's KPMG/Ipsos-Reid Canada's Most Respected Corporations survey, provided exclusively to The Globe and Mail, 87 per cent of CEOs say they have what it takes to compete in a global marketplace -- with 39 per cent saying they "strongly agree" and 48 per cent saying they "somewhat agree." The results are part of the ninth annual Canada's Most Respected Corporations Survey, sponsored by KPMG and conducted by Ipsos-Reid.
The poll, which surveyed 255 corporate leaders, identifies the most respected company and chief executive officer in the country from among their peers, and provides an outlook on economic and business conditions in Corporate Canada.
"You've got four in 10 saying they could really step up to the plate and play in the World Series while you've got another group of people saying if they ever got drafted, they'd eventually be there," said John Wright, senior vice-president at Ipsos-Reid in Toronto.
However, there remains prudence alongside the executives' confidence, the report noted, as about 71 per cent of those surveyed said they also agreed with the statement that "it is more important for my company to solidify in its current market than to expand into new markets."
But for Mr. Heck's firm, the decision of whether to compete globally wasn't much of a decision at all.
Westaim -- a unique hybrid of divisions that develop and sell pharmaceutical products, and also develop low-cost flat-panel display screens -- has been working in recent years to secure partnerships with a handful of companies in Europe and Asia to market its products.
He added that within the sectors that Westaim competes, companies either operate globally or they die.
"Under any scenario, we are forced to compete on a global scale. So for us to succeed, it's crucial that we be able to compete globally," Mr. Heck said.
Bill Dillabough, managing partner of markets with KPMG, said the results of the poll are "good news" -- noting that CEO confidence can be viewed as a bullish harbinger for the Canadian economy as a whole.
"It is encouraging to see that Canadian CEOs view their companies as world-class competitors -- but their optimism is balanced with common sense. The fact that the CEOs' priorities vary so little from last year's survey demonstrates that Canadian business leaders have a realistic and grounded approach for these economic times," he said.
He later added: "They make decisions that affect our economy. . . . And we know that when people are optimistic, they spend more money."
Mr. Dillabough said the recent rise of the Canadian dollar -- which rose more than 20 per cent in 2003 against the U.S. greenback, and has since continued to climb -- may have played an important role in the survey's results.
"One of the good things about the Canadian dollar's rise is that you're able to invest more," he said. "So, if you look at replacing capital and equipment, it becomes cheaper, especially if it's foreign made. If these people are going to do that, it makes Canada more productive down the road. Those are very positive things, and if these [CEOs] are positive about it, they will spend the money."
In addition to that question on confidence and global expansion, CEOs were asked to list their top priorities for 2004. Not surprisingly, 95 per cent said ensuring their company's long-term financial health was their key objective -- down three percentage points from last year's study.
CEOs' other priorities included: increasing productivity and improving performance; attracting and retaining high-calibre employees; customer loyalty growth; ensuring trust from shareholders; and improving corporate governance, among others.
Mr. Heck, who did not participate in the Ipsos-Reid study, shared many of those priorities. But for him, creating a safe, fun and challenging workplace for his staff also was high on his list of priorities.
"We want to be a company where people feel engaged, intellectually and personally. . . . You have to enjoy what you're doing, so we strive hard to achieve that," he said.
Shares of Westaim, traded on the Toronto Stock Exchange, touched an intraday 52-week high of $4.97 yesterday.
They closed at $4.88, up 18 cents or 4 per cent. They have been as low as $1.60 over the past 12 months.
Other results of the multipart survey, reported this week in The Globe and Mail, found that Royal Bank of Canada is the country's most respected corporation for the second year in a row. RBC has won the title four times during the poll's nine-year history.
(Bombardier Inc. has also won four times while Nortel Networks Corp. soared to the top in 2000.)
Calgary-based carrier WestJet Airlines Inc. posted one of the most impressive performances, soaring to the No. 2 spot over all from seventh last year and 147th two years ago.
Also, Paul Tellier, CEO of plane and train maker Bombardier Inc., was named Canada's most respected business chief for the second year running.
Mr. Tellier, who is just completing his first year as top troubleshooter at Bombardier after being recruited away from Canadian National Railway Co., handily won.
About the survey
These are findings of the ninth annual Canada's Most Respected Corporations Survey, sponsored by KPMG, conducted by Ipsos-Reid and provided exclusively to The Globe and Mail. Conducted between August and November 2003, the survey involve3d a randomly selected sample of 255 of Canada's leading chief executive officers. It identifies the most respected company and chief executive from among their peers, and provides an outlook on economic and business conditions in corporate Canada. A full breakdown of the ratings can be found at https://www.ipsosreid.com and https://www.mostrespected.ca. The series, as it rolls out this week, will also be available at https://www.globeandmail.com/business.