The survey asked C-Suite executives about the state of the Canadian economy, support for government deficits and stimulus, policies to promote growth, and climate change initiatives. Key findings include: - Executives expect moderate growth for the US but a weaker outlook for Canada. Low commodity prices have hurt many companies. - Most support infrastructure spending and deficits but want additional policies like skills training or tax cuts. Resources executives want policies supporting their sectors. - Companies have responded to economic conditions by cutting jobs, capital spending, and expenses. - There is support for reducing fossil fuel reliance but divisions over carbon pricing and timelines for phasing out fossil fuels.

1. The 42nd Quarterly C-Suite Survey:
Government Stimulus, Carbon Pricing, The
Impact of the Low Dollar and Market
Conditions on Business
March 28th, 2016
Sponsored by:
Published and
broadcast by:

2. 2222
Introduction
 Methodology: telephone interviews with 161 C-Suite executives from
ROB1000 companies between February 18th and March 14th, 2016.
 This quarter’s survey asked the C-Suite about:
 The state of the Canadian economy
 Support for federal government deficits, stimulus
 Policies that could promote growth, productivity
 Support for climate change initiatives, carbon pricing & phasing out fossil
fuels
 The effects of the weak Canadian Dollar and low commodity prices
 Changes companies have made to their business plans
 Cuts to staffing, capital spending

3. 3
Key Findings - Summary
 There is little expectation of a US recession. Yet the Canadian economic outlook remains
weak in comparison to the outlook for the US.
 While the low dollar has helped most companies, low commodities and energy prices have hurt more.
 Most in the C-Suite say market conditions are forcing them to change strategic/corporate plans.
 37% have reduced their staffing levels and many more have cut capital and operating expenditures.
 Most in the C-Suite support the federal government’s plan to run deficits and fund
infrastructure.
 However, few strongly support the plan to run deficits; and executives whose companies
and sectors are hurting most are in fact less supportive of the government’s approach.
 Resources executives are far more focused on commodities prices as well as any policies that support
access to markets for energy, pipelines, regulations around mining and exploration. Accordingly
those that do not expect the economy to grow in 2016 are less likely to support the government’s
approach to deficits.
 Those who do believe the economy will grow are more supportive of deficits and stimulus. Many may
be dissatisfied with the sluggish economic growth forecast for Canada while being more confident in
the capacity of governments to support deficits. They may also be more likely than those in oil & gas
to see stimulus as something that could assist economic conditions from their perspective.

4. 4
Key Findings - Summary
 Infrastructure spending remains a top of mind priority for many in the C-Suite. Yet
many want to see something more if government is introducing measures to boost
economic growth. They want to see a combination of:
 Infrastructure along with…
 Skills/training initiatives
 Tax cuts/reform
 Support for innovation/R&D, or
 Access to markets for resources.
 Most in the C-Suite support commitments to reduce the reliance on fossil fuels and
invest in clean technologies that can reduce carbon emissions.
 The C-Suite is deeply divided over whether aggressive carbon pricing policies or a
targeted phase-out fossil fuels are appropriate.
 Nearly half do not believe the economy can support phasing out carbon by 2100.

5. 5
Low Commodity & Oil Prices’
Impact on Business
 Most companies - 65% - have been negatively impacted by falling commodity
and energy prices.
 This includes a majority in the financial or services sectors as well as resources
companies.
 Most companies have either changed their strategic or corporate plans because
of market conditions or are likely to do so.
 45% have done so.
 14% are likely to do so.
 Nearly four in ten have cut personnel and a third have cut capital spending.
One in five have done both.
 28% have cut operational or other expenditures.
 33% have reduced capital spending.
 37% said they have cut personnel.
 Roughly half of those layoffs are with Alberta companies. Most ROB1000
companies in Alberta have cut capital spending and cut personnel.

6. 6666
Impact of Commodities & Oil Prices
27
8
30
35
50
27
21
8
3
5
14
11
16
65
89
66
51
39
57
79
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
Rest of Canada
Manufacturing
Services
Resources
Positive Neither Negative
Is the drop in prices for commodities and oil over the last two years having or likely
to have a positive or negative impact on your business?

7. 7777
Company Planning
45
74
48
29
33
23
68
14
8
9
19
17
19
10
1
3
1
1
39
18
41
49
50
55
21
1
2
1
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
Rest of Canada
Manufacturing
Services
Resources
Yes, have changed Yes, likely to change Possibly No Unsure
Thinking about your company's planning over the next 3 to 5 years, have recent
economic conditions over the last 12 months led your company to change its strategic
or corporate plan or are they likely to lead to a change?

8. 8888
Reactions to Market Volatility
37
33
20
17
13
11
11
8
7
6
5
4
0 10 20 30 40
Reducing # of employees
Reducing capital spending
Nothing
Reducing expenditures
Changing financing (debt/ equity)
Cutting operating expenses (not incl. labour)
Strategy/planning revised, reprioritizing
investments/focus
Delay/ reductions in production/ some operations
Focus on Markets that are not negative, new marketing
Expanding/ investing outside of Canada
More caution in decision making
Increasing # of employees
% saying each
Recent market volatility, the depreciation of the dollar and low commodities prices have led some
companies to make changes to planned capital expenditures, financing, staffing, or other aspects of
planning and expenditures. What are some of the most important changes your company may have initiated
in light of recent market conditions?
Others:
Currency changes/ hedging: 3%
Investing in tech: 3%
Strengthening balancing sheet: 2%
Acquisition/buying: 2%
Shifting focus and/or investment
attention out of the west: 2%
Salary cuts: 2%
Closed a company/operation: 1%
Increasing expenditures: 1%
Selling assets: 1%
Increasing capital spending: 1%
Other: 2%

9. 9999
Reactions to Market Volatility
37
33
74
55
30
30
21
23
0 50 100
Reducing # of employees
Reducing capital spending
Total
Alberta
BC, SK,
MB
Ontario
% Saying Each
Recent market volatility, the depreciation of the dollar and low commodities prices have led some
companies to make changes to planned capital expenditures, financing, staffing, or other aspects of
planning and expenditures. What are some of the most important changes your company may have initiated
in light of recent market conditions?

10. 10101010
Expectations of
the Canadian and US Economies
7 79
43
13
52
1
4 2
0 20 40 60 80 100
US economy
Canadian
economy
Strong growth Moderate growth Moderate decline
Strong decline DK/NR
What are your expectations for the U.S. /Canadian economy over the next 12 months,
strong growth, moderate growth, moderate decline, strong decline? (% saying each)

11. 11
Federal Government’s Budget &
Policy Setting
 Most in the C-Suite (56%) support the federal government’s intention to run
deficits over the next three years and fund new infrastructure.
 Only 9% strongly support this, suggesting caution around the kind of deficits
Ottawa may be running up and for how long.
 The sector that is hurting most as well as those who don’t expect Canada’s
economy to grow in 2016 are less supportive of deficits & stimulus.
 Those who expect the economy to grow are more supportive of deficits and
stimulus.
 Conceivably those in oil & gas know that stimulus will not assist depressed energy prices or may
be more concerned about government debt in a weak economy.
 Those who expect the economy to grow in 2016 may be more comfortable with the government’s
stability of revenues while still being dissatisfied with the rate of growth. Services sector
companies, have been negatively impacted by low energy prices, and may see promise in
stimulus spending.

12. 12121212
Support for Federal
Deficits & Stimulus
9
7
16
7
13
10
11
47
50
48
43
44
49
33
49
44
23
32
27
18
22
25
40
20
26
20
18
16
23
27
13
27
20
19
1
2
1
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
ON, QC, ATL
Expect Canada's economy to
decline
Grow
Oil & Gas Sector
Services
Manufacturing
Strongly support Somewhat support Somewhat oppose Strongly oppose Unsure
Canada's new Liberal government has committed to increased infrastructure spending. It
has also signaled that this spending and other measures as well as a slowing economy mean
the government intends to run deficits over the next three years. Is this something you:

13. 13
Federal Government’s Budget &
Policy Setting
 The C-Suite believes a balanced approach is needed if the government is going
to promote economic growth and productivity. Many would hope for
something in addition to investments in infrastructure:
 Support for innovation/R&D
 Getting resources to market, pipelines
 Education and skills training
 Reduced taxes/tax credits
 The C-Suite cites a range of factors that hold Canada back from long-term
economic growth:
 Commodities: either depressed markets for commodities or the need for diversification
away from resources
 As well as:
• The level of education & skills training in Canada
• Low productivity/competitiveness
• Taxes
• Government intervention

14. 14141414
How to Promote Long-term Growth
47
19
15
14
14
9
4
4
4
4
4
0 20 40 60
Investment in infrastructure & public transit
Funding innovative tech/clean tech/ R&D
Access to markets for resources
Reducing tax, tax credits
Supporting education, job and skills training
Support SME, start-ups
Increase public/private investment
Facilitating trade/ exports
Ensure responsible spending, curb deficit
Gov't cannot grow economy long term
Stabilit of interest rates/ currency
% saying each
If the government does proceed with new, incremental spending to promote Long-term economic growth
and productivity in Canada, what in your view would be the best approach it should take to promoting
growth and productivity?
Others:
Reducing personal taxes: 2%
Other: 2%
Don’t know: 2%
No Response: 2%

15. 15151515
Obstacles to Long-term Growth
17
16
9
8
8
6
4
4
4
4
0 5 10 15 20
Lack of economic/market diversity/ resource
dependency
Low commodity and dollar prices
Educated/ skilled workforce (needed)
Gov. intervention/Federal policies diverting econ
improvements
Global economy, competitiveness/ productivity
Increasing taxes
Lack of pipelines/ oil market access
Access to capital
Lack of trust in econ, instability of consumer
attitudes
Lack of investment in tech/ R&D
% saying each
What is the single greatest obstacle to improving the prospects for long-term economic growth and
productivity in Canada?
Others:
Provincial disagreements: 3%
Too many regulations: 3%
High corporate taxes: 2%
High cost of labour: 2%
Environmental/ GHG legislation: 2%
Debt/ deficit reduction needed: 1%
Infrastructure dev. needed: 1%
Lack of clear energy plan: 1%
Other: 1%
Don’t know: 1%
No Response: 1%

16. 16161616
Alberta’s Energy Sector
Diversification Efforts
17
11
18
20
28
4
47
58
48
42
49
46
16
13
14
18
12
20
12
18
9
9
4
21
8
11
11
7
9
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
Rest of Canada
Support deficit
infrastructure spending
Oppose
Strongly support Somewhat support Somewhat oppose
Strongly oppose Unsure
The Alberta government has proposed policies and royalty credits that would help
diversify Alberta's energy sector, in part by subsidizing the development of
petrochemicals and chemical manufacturing sector in the province. Would you say
this plan is something you…

17. 17
Climate Change, Carbon & Energy
Sources
 Most in the C-Suite welcome policies and investments that will reduce reliance
on fossil fuels and invest in innovative clean tech and clean transportation.
 Many in the C-Suite are strongly supportive.
 Most in Alberta 55% are generally supportive of this agenda, 45% are opposed.
 In the rest of Canada roughly 8 in 10 are generally supportive of this.
 There is significant division in the C-Suite when it comes to aggressive
proposals to reduce carbon consumption.
 Half would support something like the US Administration’s proposal to tax oil at
US$10 a barrel to support climate change initiatives. Half (49%) oppose this.
 A clear majority in Alberta oppose this type of pricing approach.
 In the rest of Canada a slim majority is supportive.
 52% of the C-Suite believes that 2100 or sooner – the target the G7 has set – is
realistic.
 31% said any timeline to phase out carbon is inappropriate or unrealistic.

18. 18181818
Public Investment in Clean Tech,
Transit & R&D
32
18
39
35
20
33
33
37
28
36
42
37
48
42
40
37
50
40
37
49
17
34
11
12
27
19
11
16
21
12
8
11
2
9
13
11
6
7
12
3
1
1
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
ON, QC, ATL
Oil & Gas Sector
Banking/Financial
Manufacturing
Services
Expect Canadian economy to
decline
Grow
Strongly support Somewhat support Somewhat oppose Strongly oppose Unsure
Governments in the US and Canada have proposed reducing reliance on fossil fuels by investing public money
into research and development in the field of clean technologies and transit. Is this something you:

19. 19191919
White House’s $10 a Barrel Tax for
Clean Tech and Transit R&D
19
5
20
24
39
27
5
31
32
39
28
17
36
30
22
24
16
26
22
19
26
27
39
25
20
22
19
36
1
1
3
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
ON, QC, ATL
Manufacturing
Services
Resources
Strongly support Somewhat support Somewhat oppose
Strongly oppose Unsure
The White House recently proposed a 10-dollar a barrel tax on oil that would equate
to 25 cents on a gallon of gasoline. That money would be invested in research and
innovation in the field of clean technologies as well as in public transit in order to...

20. 20202020
Elimination of Fossil Fuel Use by
2050 – Worthwhile?
19
11
16
32
28
24
12
16
28
24
13
27
22
39
23
21
20
30
19
21
10
11
6
20
21
22
14
37
53
44
35
22
31
45
40
28
2
3
2
6
1
1
2
0 20 40 60 80 100
Total
Alberta
BC, SK, MB
ON, QC, ATL
Manufacturing
Services
Resources
Oil depreciation: negative
impact on co.
Positive impact on co.
Strongly agree Somewhat agree Somewhat disagree
Strongly disagree Unsure
Some analysts have suggested Canada could completely eliminate the use of fossil
fuels by 2050. Would you agree or disagree that this goal is goal is worthwhile?

21. 21212121
Elimination of Fossil Fuel Use by
2050 – Realistic?
7
4
14
15
11
19
19
21
19
57
61
49
2
3
0 20 40 60 80 100
Total
Oil depreciation:
negative impact on co.
Positive impact on co.
Strongly agree Somewhat agree Somewhat disagree
Strongly disagree Unsure
Would you agree or disagree that this goal is realistic?

22. 22222222
Target for Elimination of Fossil Fuel
Use
14
38
5
31
11
0 10 20 30 40 50 60
Total
By 2050
2051-2100
2101-2300
Never
Don't know/ No
response
% Selecting Each
The G7 leaders committed last year to eliminate the use of fossil fuels by the year
2100. By what date do you think Canada could completely eliminate the use of fossil
fuels?

23. 23
Climate Change, Carbon & Energy
Sources
 Only 14% would suggest a target date as early as 2050 to phase out fossil fuels.
 The vast majority believe 2050 is unrealistic.
 43% agree it is worthwhile to try to phase out fossil fuels by 2050, as some have
proposed – 56% think it is not.
 The C-Suite is more likely to mention economic obstacles rather than
technological ones in explaining why such a 2050 timeline is out of reach.
 28% mention the need for new technology or viable alternatives
 30% mentioned cost
 12% mentioned consumers’ reliance on current modes of transport
 7% mentioned the infrastructure changes that would be needed
 7% mentioning the oil industry itself and its influence
 6% mentioned the detriment to the economy and resources sector

24. 24242424
Obstacles to Elimination of Fossil Fuel
Use by 2050
30
16
12
12
7
7
6
4
4
0 10 20 30 40
Cost of alternatives
Lack of technology
The need for viable alternatives
Consumer reliance on cars
Industrial complex (oil, auto)
Infrastructure
Resource econ/ would harm economy
Gov't/ political intersts aligned w industry
Unrealistic to eliminate entirely
% saying each
What is the single greatest obstacle to the elimination of fossil fuel use by 2050?
Other: 1%
Don’t know: 1%
No Response: 1%

25. 25
The Canadian Dollar’s
Impact on Business
 For most companies, the depreciation of the Canadian dollar has been a
positive.
 If the dollar rose to 80 cents, many (41%) said it would have a negative impact
on their companies – especially resources companies.
 The vast majority agreed the lower dollar puts Canadian companies at a higher
risk of foreign takeover.
 The C-Suite is split on the lasting impact it will have on head office jobs.
 54% believe the low dollar is cyclical and will not have a lasting impact on head office jobs in Canada
– 44% disagreed.
 Only 15% agreed the recent takeover of Rona by US-based Lowe’s was a negative development for
Canada’s economy.
 The C-Suite was also divided on whether the Bank of Canada’s mandate should
include an emphasis on protecting the dollar: 54% agreed it should.

26. 26262626
Implications of Low Dollar
25
15
12
2
54
39
42
13
16
30
33
45
5
14
11
34
2
2
5
0 20 40 60 80 100
The lower dollar will put
Canadian companies at higher
risk of foreign take over the
next twelve months
The Bank of Canada's
mandate should include some
emphasis on protecting the
value of the dollar
The low Canadian dollar is
merely cyclical and will not
have a lasting impact on head
office jobs in Canada
The purchase of Quebec-
based Rona by US retailer
Lowe's is a negative
development for Canada's
economy
Strongly agree Somewhat agree
Somewhat disagree Strongly disagree
Do you agree or disagree with each of the following statements that have been made
about the depreciation of the dollar?

27. 27272727
Impact of Dollar Depreciation
65
67
57
71
12
20
7
23
33
21
22
1
0 20 40 60 80 100
Total
Manufacturing
Services
Resources
Positive Neither Negative Prefer not to say
Is the depreciation of the Canadian dollar over the last year on balance having or
likely to have a positive or negative impact on your business?

28. 28282828
Impact of 80 Cent Dollar
9
11
4
12
35
50
43
23
35
33
30
41
6
6
1
11
15
21
12
0 20 40 60 80 100
Total
Manufacturing
Services
Resources
Very positive Somewhat positive Somewhat negative
Very negative No change
The depreciation of the Canadian dollar has been an important topic. If the dollar
was valued at 80 cents or higher would that have a very or somewhat positive impact
on your company or a very or somewhat negative impact on your company?

29. 29
Assessments of the Economy
 There is little expectation of a US recession. The Canadian economy is weak
but the outlook is effectively stable – no better or worse this quarter than in
Sept. or Dec. 2015.
 Company outlook remains unchanged in the last 6 months; most have
modestly positive outlooks for their businesses, with the weakest outlook
confined mostly to the resources sector.

30. 30303030
Projections For The Canadian
Economy
What are your expectations for the Canadian economy over the next 12 months,
strong growth, moderate growth, moderate decline, strong decline? (% saying each)
89
72
58
15
55
91 92 92 95
69
82
75
87
91 91
97
89
77
60
66
47 45 43
10
28
40
85
45
8 7 8 5
29
16
20
12
9 9
3
10
24
39
33
53 53 56
0
20
40
60
80
100
120
Growth Decline

31. 31313131
Projections for
The US Economy
8689
9390
93
89
9495
9092918986
6768
72
51
33
71
61
50
70
6668
55
4
22
18
1411
710
7
10
64
898101331
2927
47
67
28
38
50
313230
45
96
76
81
0
20
40
60
80
100
120
Growth Decline
What are your expectations for the U.S. economy over the next 12 months, strong growth, moderate
growth, moderate decline, strong decline? (% saying each)

32. 19
21
24
18
23
27
58
58
51
41
74
64
20
19
22
35
3
9
1
1
1
3
2
1
3
3
0 20 40 60 80 100
Q1 2016
Q4 2015
Q3 2015
Q1 Oil/gas, energy, resources
Q1 Services
Q1 Manufacturing
Strong Growth Moderate growth Moderate decline
Strong decline Don't Know
32323232
Outlook for Business
What are your expectations for your company over the next 12 months, strong
growth, moderate growth, moderate decline, strong decline? (% saying each)