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Written by Sibo Chen, Toronto Metropolitan University. Image credit: Doug Mills/The New York Times via AP. Originally published in The Conversation. 

U.S. President Joe Biden and China’s President Xi Jinping walk in the gardens at the Filoli Estate in Woodside, Calif. on the sidelines of the Asia-Pacific Economic Cooperation conference.

In a politically turbulent world, it is rare to witness major global actors set aside their disagreements to address the existential threats posed by climate change. On Nov. 14, the United States and China did just this by issuing the Sunnylands Statement on Enhancing Cooperation to Address the Climate Crisis.

Issued prior to the pivotal Biden-Xi meeting on Nov. 15 at the Asia-Pacific Economic Cooperation (APEC) summit in San Francisco, the statement not only establishes a spirit of co-operation but also sustains the progress made in recent climate dialogues between the world’s two largest greenhouse gases (GHG) emitters.

Climate organizations and analysts have welcomed the statement. China Dialoguestated that it shows that even with their complex relationship, both nations are committed to prioritizing climate issues. While the Asia Society Policy Institute characterized the bilateral alignment of the statement as an “insurance” to the ongoing 28th United Nations Climate Change Conference (COP28).

As a scholar closely monitoring the global implications of China’s climate policy, the statement is particularly intriguing for how it describes China’s approach to energy transition. China’s determination to “ramp up renewable energy with the goal of displacing fossil fuels” should be taken seriously by Canadian, and global, policymakers when planning energy futures.

Accelerating renewable energy transition

There are two significant developments within the statement which are worth highlighting. The first is China’s commitment to setting comprehensive climate targets by 2035 that encompass all greenhouse gases (GHG) and the second is its unprecedented consideration of absolute emission reductions in its (primarily coal-fuelled) power sector within this decade.

Such policy language is crucial for figuring out China’s future energy import prospects.

The Sunnylands Statement indicates that the U.S. and China recognize climate change mitigation as one of the limited domains in which they appear willing to cultivate stability in their bilateral relations. This isn’t entirely surprising, given the rapid transition towards renewable energy sources that both countries have undertaken. This trend gained momentum during the pandemic and is anticipated to continue as their economic activities recover, and become more dependent upon renewable energy.

This has been confirmed by BloombergNEF’s 2023 Sustainable Energy in America Factbook, which reported that in 2022, U.S. energy transition investments rose 11 per cent year-on-year to $141 billion — a clear indication that clean energy is now an integral part of the American economy.

Meanwhile, despite the present obstacles, estimations for China’s greenhouse gas emissions indicate a probability exceeding 80 per cent that the country will reach its carbon peak between 2021 and 2026.

The journey towards decarbonization is not without obstacles. As highlighted in a recent review paper published by Applied Energy, about half of the announced economic stimulus plans worldwide continue to be dominated by fossil fuel investments. In countries like Canada, the allocation of subsidies to the oil and gas industry has generated public controversy.

Beyond investments, fundamental changes in how people travel and work — borne of the pandemic — may lead to enduring long-term reductions in the use of fossil fuels for transportation. As evidenced by a recent study published by PNAS, the growth in remote and hybrid work alone could reduce individual carbon footprints by as much as 58 per cent.

All eyes on COP28

The Sunnylands Statement, signifying the world’s two largest economies’ pledge to “pursue efforts to triple renewable energy capacity globally by 2030,” can thus steer discussions at COP28 towards meaningful fossil fuel phase-out strategies. Yet, concerns emerge when we consider Canada’s lack of determination in phasing out its oil and gas industry.

Reports on Canada’s fossil fuel industry’s role at COP28 have stoked fears of “greenwashing” over carbon capture proposals in Alberta. These proposals are intended to tackle GHG emissions during oil sands production but do not address the emissions from the consumption of fossil fuels.

This brings us to a crucial question looming over COP28: what does “net zero” actually entail? In her book Ending Fossil Fuels, environmental scholar Holly Jean Buck warns against a potentially perilous narrative that envisions a “cleaner fossil world” in which carbon storage and other forms of carbon capture continue to obscure the dominance of fossil fuels, thereby failing to address systemic problems caused by contemporary society’s addiction to carbon-intensive modes of economic growth.

If the unprecedented numbers of lobbyists — and perhaps even the COP28 president — have their say in preventing firm policy language concerning the end of the expansion of fossil fuels then a cleaner fossil-fuel world is likely to become our future. A future we should all be wary of.

Charting a new course

Although the Sunnylands Statement is undoubtedly a step in the right direction, it must be accompanied by a focused dialogue on the true meaning of net zero. Will a country lean towards net zero achieved primarily by renewables, or one achieved by carbon capture and storage?

How major economies (the U.S., China, Canada, etc.) approach these issues carries significant national and international consequences. The Sunnylands Statement paved the way for energy talks at COP28, and the world is eagerly watching such talks’ outcomes.

As said by the UN Secretary-General António Guterres, “The world is watching, and the planet can’t wait.”

Written by Seung Hwan (Mark) Lee, Toronto Metropolitan University and Omar H. Fares, Toronto Metropolitan University. Image credit: Shutterstock. Originally published in The Conversation. 

People tend to ‘panic buy’ in times of crisis, which often leads to shortages of essential items.

Fear can cause people to behave irrationally in times of uncertainty. During the pandemic, this took the form of panic buying as people flocked to stores to stock up on essential goods. Some even sought to profit off of shortages by price gouging toilet paper and hand sanitizer.

This phenomenon wasn’t just limited to a few countries or communities, either; it was a global occurrence that emptied supermarket shelves and caused significant disruptions in supply chains.

But what drives people to behave in such ways during times of crisis? Is it a basic survival instinct, a herd mentality influenced by social pressures or something more complex?

During the onset of the pandemic, we conducted a study aimed at understanding the complex web of factors that compel us to act or overreact in the face of uncertainty.

Psychological traits of consumers

We examined the following factors in our study: narcissism, psychological entitlement, status consumption, fear of embarrassment, and fear of missing out. Narcissism is a trait characterized by a heightened sense of self-importance and a lack of empathy for others.

Psychological entitlement refers to the belief that one is inherently deserving of special treatment or privileges. Status consumption is the tendency to purchase items that confer social prestige or dominance.

Fear of embarrassment is anxiety about being negatively judged by others. Fear of missing out is the worry over missing out on rewarding experiences that others are taking part in.

Unique types of consumers

Our study identified four distinct consumer groups, each with unique psychological traits that drove their purchasing habits.

1. Egalitarians. Egalitarians displayed low levels of narcissism and psychological entitlement compared to the other groups. They tend to have a more community-oriented and balanced approach to life. They likely have a strong belief in communal responsibility and fairness. Egalitarians are the type of individuals who volunteer at local food banks or participate in community clean-up events.

In terms of purchasing, egalitarians did not hoard as much as other groups. While others might hoard hand sanitizers, for example, an egalitarian might buy just one or two bottles and leave the rest for others in the community.

2. Conformists. Conformists are influenced by a moderate fear of missing out and a high fear of embarrassment. Conformists are the type of people who follow dress codes and rarely question authority.

When it comes to purchasing, conformists prioritized items that aligned with public health guidelines, like disposable masks. They are usually the first to buy masks in bulk when a new public health advisory is released.

3. Communal egoists. Communal egoists display moderate levels of narcissism and psychological entitlement. For example, this kind of person might organize a community event, but will insist on being the centre of attention during the event.

This group is particularly interested in food-related items like bottled water and snacks. A communal egoist might stock up on these products, not only for themselves, but with the intention of sharing with their neighbours in an effort to stand out.

4. Agentic egoists. Agentic egoists are characterized by high levels of narcissism and psychological entitlement. For example, an agentic egoist might cut in line because they believe their time is more valuable than others.

In terms of purchasing, agentic egoists are willing to spend more on items that directly benefit them. For instance, they might buy the last three bottles of an expensive, brand-name cough syrup, without considering that others might need it, too.

What this means for consumers

A significant lesson we’ve learned from the COVID-19 pandemic, and the subsequent global turmoil, is the importance of being ready for the unexpected.

If you’ve ever found yourself filling your shopping cart to the brim in a moment of panic, you’re not alone. But understanding who we are, why we make certain decisions and how we can be more considerate is the first step toward making better consumer choices.

Are you an egalitarian, thinking of the community while only buying what you need? Or perhaps you identify as a conformist, sticking strictly to items advised by health authorities? Recognizing these traits in ourselves can be a wake-up call, encouraging us to shop more responsibly, especially in times of fear and panic.

What this means for retailers

Understanding the traits of different customer groups isn’t just about boosting profits. It’s a way to guide businesses in serving communities ethically and effectively, especially in times of crisis.

For example, if most of your customers tend to follow the crowd (conformists), consider offering reliable public health information in your stores. If your clientele leans towards fairness (egalitarians), make fair distribution of essential items a core part of your community support strategy.

If you cater to individuals who focus on their self-interest (agentic egoists), think about the long-term impact of promoting high consumption and how to encourage responsible buying. If a large portion of your customers are community-focused (communal egoists), think about setting up ongoing community-sharing programs or donation drives.

As we reflect on the challenges we’ve faced, retailers have an opportunity to plan for a future where their actions benefit not only their business, but society as a whole. Enhancing our self-awareness enables us to handle chaotic circumstances more gracefully and make decisions that are advantageous for everyone in our vicinity.

Written by Cory Searcy, Toronto Metropolitan University, Grant Michelson, Macquarie University and Pavel Castka, University of Canterbury. Photo credit: Shuttershock. Originally published in The Conversation.

Canadian companies will soon be legally obligated to annually report on efforts to prevent and remediate forced and child labour in their supply chains. Technology could help them do this.

Levi Strauss Canada is yet another company facing allegations of forced labour in its supply chain. The allegations, which Levi Strauss denies, centre on whether the company is working with suppliers using Uyghur forced labour. With over 27 million people worldwide in forced labour, we can expect to witness similar allegations elsewhere in the coming years.

While Canada enjoys strong protections against labour exploitation, the issue of involuntary work may hit closer to home than expected. The reality is that forced labour could have been used to produce many of our everyday items, including clothing, electronics and vehicles.

Canada has taken a significant step in addressing this problem through the Fighting Against Forced Labour and Child Labour in Supply Chains Act. As of Jan. 1, 2024, companies with significant operations in Canada will be legally obligated to pay closer attention to the working conditions in their supply chains.

This act brings Canada’s efforts to address forced labour in alignment with other regions such as the United States, the United Kingdom and Australia.

Under this act, any entity with significant operations in Canada will be obligated to annually report on its efforts to prevent and remediate forced and child labour in its supply chains.

This includes disclosing information about relevant policies, due diligence processes, supply chain hotspots, employee training and remediation measures. The act also includes provisions for corrective measures and punishment.

Identifying forced labour with technology

The complex nature of supply chains makes identifying when and where forced or child labour occurs a significant challenge. Supply chains can contain thousands of suppliers that span continents. Even major international companies like Levi Strauss, which has a strong supplier code of conduct, can end up facing allegations of violations in their supply chains.

To explore how forced and child labour can be identified in supply chains, we conducted over 30 interviews with experts from around the world. These experts included representatives from non-governmental organizations, companies and auditing bodies, providing insight into how emerging technologies can be used to support identifying such practices.

The difficulty of identifying far-flung suppliers, for instance, could be simplified by using DNA to identify a product’s origin, as is done with cotton, seafood and chocolate.

Drones and satellite imaging can be used to identify potential forced labour hotspots, such as remote brick kilns, mines or areas of illegal deforestation. AI can also predict areas at high risk of forced and child labor and direct attention to these regions.

Additionally, emerging technologies can help identify some forms of deception. Blockchain technology, for example, can provide an unalterable ledger of transactions in real time, preventing later manipulation. Artificial intelligence can quickly process immense quantities of data, which aids in detecting unusual patterns indicating potential fraud.

Addressing the risk of deceptive practices

In some cases, there are incentives for businesses to conceal illegal and immoral practices. Transparentem, a non-profit group focused on eradicating labour abuse, found evidence of deception during supply chain audits in garment factories in India, Malaysia and Myanmar. These deceptive practices include falsifying documents, coaching workers to lie and hiding workers who appeared to be unlawfully employed.

Based on in-depth interviews with auditors, suppliers, brand representatives and workers in the apparel industry, Human Rights Watch has found these risks are elevated when companies have advance notice of an upcoming audit.

Integrating sensors, cameras and other cloud technology can enable real-time monitoring of working conditions, mitigating the risks of advance notice of audits. Sensors and cameras, for example, have been used on fishing vessels to remotely transmit data in near real-time.

Worker voice platforms, such as those used in the electronics industry, allow workers to provide feedback directly through smartphone apps. This can serve as a real-time whistleblower mechanism for workers trapped in forced labour.

Technology is only part of the solution

Despite its potential benefits, technology still has weaknesses, like high costs, susceptibility to manipulation and weak data security, that need to be addressed. Blockchain technology, for instance, can codify manipulated or incorrect data unless the necessary precautions are taken.

Meeting the requirements of the Fighting Against Forced Labour and Child Labour in Supply Chains Act will require grounding technology in a broader risk-based approach consisting of supplier screening, monitoring and auditing.

In addition, even when technology does indicate the presence of forced or child labour, on-the-ground verification and follow-up is often required. Identification is just the first step. The act requires reporting on remediation, which is typically based on long-term collaborative relationships with local parties.

Addressing the issue of forced and child labour in supply chains is difficult and complex. While technology can help companies fulfil their reporting obligations under the act, identifying and remediating these crucial issues will require ongoing and concerted efforts.

The first report is due on May 31, 2024, so companies have no time to spare in working to comply with the act.

Written by Ivor Shapiro, Toronto Metropolitan University. Photo credit: THE CANADIAN PRESS/Christinne Muschi and Graham Hughes. Originally published in The Conversation. 

Pro-Israel and Pro-Palestine demonstrations have been held around the world since the Hamas attack on Israel on Oct. 7, including these protests in Montréal. 

By any definition of terror, the word covers killing children in their homes and taking concert-goers hostage to further a political cause. So why, even after the mass killings and kidnappings in Israel on Oct. 7, do major news organizations resist multiplying calls to describe Hamas as a terrorist organization?

Preliminary phrase searches through ProQuest Global Newstream in the days following Oct. 7 suggest that news organizations with conservative leanings (such as The Telegraph and The Australian) are most likely to use terrorist adjacent to the name Hamas. Wire services, public broadcasters and national news brands with broad readerships reach more diligently for neutral terms. They may call Hamas a militia and use killings or attacks where others say atrocity or slaughter.

For its part, the BBC responded to fierce pressure from politicians and Jewish leaders by claiming the high ground of professional best practice and autonomy, stating:

“The BBC is an editorially independent broadcaster whose job is to explain precisely what is happening ‘on the ground’ so our audiences can make their own judgment.”

The Canadian Press advises journalists to avoid “labelling one side the terrorists, which makes the other side automatically the good guys.”

It points out that language affects perceptions (“‘One person’s terrorist is another person’s freedom fighter,’ as the saying goes”) and that, in addition to being neutral, “terms such as bombers, gunmen and killers also offer the advantage of being more specific.”

The opposing case for more laden terms is pressed by politicians and advocates who likely echo constituents’ visceral reactions. To those who mourn or rage in violent times, neutral language may seem performative at best — or even cruel. On both sides of the Gaza-Israel Iron Wall, wells of semantic offence rise from aquifers of generational trauma and justified fear.

The enduring offence of neutrality

Neutral language is only one of several rituals through which journalists have long buttressed an occupational ideology centred on truth-telling.

Their stuffiest aspirational ideals — such as professed impartiality, putative firewalls between news and commentary and the mantra “journalism is a discipline of verification” — have been upstaged by an emphasis on transparency and networked collaboration.

Today’s 24/7 feed of alerts and updates includes a stew of alleged facts and newsy opinions. Some say this is OK because truth is whatever people come to believe after exposure to a variety of reports.

An especially radical post-truth doctrine considers facts ascertainable only through the lens of people’s life experiences. According to this view, sometimes dubbed “standpoint epistemology,” truth-seekers should defer to the realities born, especially, of suffering and prejudice.

Given such ground-shaking critiques, barely a tremor registered when major news sources began calling blatant untruths lies and discriminatory acts racist. So, then, why not terrorist?

Where editors cling on to neutral language, it’s partly to avoid slippery slopes. Leading Israelis have, in recent months, used startlingly non-neutral terms — such as war crime and apartheid — to describe their own country’s management of occupied lands, even as foreign critics were tagged antisemitic. Now, the Oct. 7 attacks are described as pogroms and the siege of Gaza as genocide.

If terms like these are queued next on the why-not playlist of editorial style, it’s merely pragmatic to prefer words denoting data (killed) over those inviting adjudication (murdered).

The reporter’s role as listener

Beyond pragmatism, the pull to neutral ground is consistent with a ubiquitous conception of a journalists’ professional identity.

Despite this century’s digital-information disruptions and social-justice reckonings, many journalists still aspire to “report things as they are.”

The 67-country Worlds of Journalism Study, fielded in the mid-2010s, found surprising resilience in journalists’ self-understanding as “detached observers and objective bystanders.” These ideals were developed in industrialized western countries and successfully exported to other news cultures “through institutional transfer, training, and education, as well as the diffusion of occupational ideologies.”

According to this vision, journalists aren’t qualified to denounce war criminals; at best, they might clearly explain the established protocols for proscribing warfare.

Professional roles shape collective standards and influence, however imperfectly, practice. Some jobs demand partiality, others even-handedness. But for those in conciliatory roles, such as mediators and therapists, a key demand is non-judgmental listening.

Something similar may apply to responsible journalism.

Just three days after the most devastating attacks on Jews since the Holocaust, it was a reporter for the Israeli newspaper Haaretz who interviewed Gaza residents about Hamas’s invasion and its consequences.

The report conveyed ordinary people’s raw reactions — longing, rage, dread. One woman said that after early reports: “We were ecstatic.… But as the picture became clearer, and I saw that there were Israeli prisoners, I realized that we were in a nightmare, in hell.”

Likewise, an interview in the U.S. magazine Slate relayed the voice of a peace activist “reeling at the images of the brutality” while struggling, as he put it, to balance solidarity with his fellow Jews against the attacks’ historical background.

“This didn’t happen (because) Palestinians are just some terrible other form of human beings,” he said. Rather, they had “endured so much horror and trauma that they’re responding in this case in really, really terrible ways.”

Reports like this include emotive words, but in quotation marks. For reporters to honour their listening role demands a disciplined withholding of judgment that requires, in turn, a restrained lexicon. The hoped-for result: a more deeply informed populace.

Elevating facts as an act of faith

Reporters’ professional duty to mirror what’s being said and done stems from their most foundational duty: meeting communities’ need to know what’s going on. How close is the downtown fire to my kid’s school? Is the furniture factory downsizing? Has mom’s apartment building been bombed?

Facts matter locally, nationally, and internationally (see war, above). Constitutional democracies foster autonomous news-gathering through a range of protections that include source confidentiality, libel defences, access to restricted areas and various forms of taxpayer-funded subsidy.

Why? Because these democracies recognize the pursuit and publication of factual information about current affairs (that is, news) to comprise a “public good.”

According to the Reuters Institute at Oxford University, significant numbers of people in many countries remain inclined to trust the news sources they follow, sources often chosen for displaying the decidedly old-fashioned virtues of “balance and impartiality”.

For their part, the most responsible journalists know that their choices of stories, sources and words sometimes deepen innocent people’s wounds. Minimizing harm stands alongside truth-telling amongst journalists’ frequently conflicting principles but making facts plain could carry more weight than that borne by professional diligence.

If so, the enduring draw of unembellished facts could express a collective leap of faith — a gut belief that “reporting things as they are” will ultimately do less harm than good.

And perhaps it will. Perhaps, by expanding the supply of plain truths about human beings’ lives, self-restrained reporters nurture world views that are more expansive and less authoritarian than those fed by prejudices, truisms, and lies.

Written by Fahad Ahmad, Toronto Metropolitan University, and Baljit Nagra, University of Ottawa. Photo credit: THE CANADIAN PRESS/Darryl Dyck. Originally published in The Conversation.

A person holds a sign during a protest outside the Indian consulate in Vancouver in September 2023.

Prime Minister Justin Trudeau has accused India of being involved in the assassination of Hardeep Singh Nijjar, a Canadian Sikh leader, on Canadian soil.

Narendra Modi’s right-wing Hindu nationalist Indian government is defiant and denies involvement. Indian officials have instead admonished Canada for being a “safe haven” for Sikh “terrorism,” a pejorative for Sikh self-determination.

India’s weaponization of “terrorism” is a ploy to justify its transnational aggression. It is using the rhetoric of “terrorism” seemingly to imply that if the West can engage in extrajudicial killings, India can too.

The tactic also deflects attention from the Modi government’s well-documented abuses of religious minorities, caste-oppressed and Indigenous people, journalists, activists and academics in India.

Deploying “terrorism” as such mirrors a long history of its use by colonial powers to suppress political dissent.

Terrorism: A contested concept

While the use of “terrorism” is ubiquitous, it has no agreed-upon definition. The Criminal Code of Canada defines terrorism as an act committed “in whole or in part for a political, religious or ideological purpose, objective or cause” with “the intention of intimidating the public.”

“Terrorism” also signifies illegitimate or immoral violence, which legal definitions do not capture.

The so-called War on Terror, initiated after the 9/11 attacks in 2001, gave new life to anti-terrorism legislation globally. This is when Canada incorporated the above definition of “terrorism” into the Criminal Code.

As security agencies focused on “terrorism” by Muslim-identified groups, anti-terrorism laws disproportionately targeted Muslims.

Canadian critical race scholar Sherene Razack argues that counter-terrorism uses “race-thinking” to maintain narrow notions of nationhood. This results in marginalizing certain groups that can then be legitimately subject to repressive and unconstitutional laws.

Terrorism and state violence

The term “terrorism” is intertwined with a colonial history of state violence. The British empire routinely invoked “terrorism” to suppress political dissent within colonies.

In the name of national security, “terrorism” was used in Canada to justify state violence against Indigenous people as well as against feminists, labour movements and other political dissidents.

The War on Terror resulted in the American-led invasion of Iraq and Afghanistan, causing death and displacement of millions, as well as the securitization of Muslim citizens.

State violence could once itself be considered terrorism, but in recent decades, the term has come to exclude state violence.

Terrorism is now understood as illegitimate violence by non-state entities. This is odd considering states themselves can engage in immoral violence on a scale that cannot be matched by non-state organizations.

State violence is often ideologically motivated, with the intention to induce widespread fear and behavioural change. This has prompted some scholars to make the case for reconsidering state violence itself as terrorism.

Colonial techniques of power

The Indian government’s use of the term “terrorism” to squash political dissent borrows from the playbook of colonial powers.

India’s national security laws — the Prevention of Terrorism Act (POTA) and the Unlawful Activities Prevention Act (UAPA) — set the stage for widespread human rights and civil liberties violations.

The Modi government’s 2019 amendment to the UAPA made it possible to designate citizens as terrorists without following formal judicial processes.

These laws have been abused to imprison activists, journalists, human rights defenders, caste-oppressed communities and religious minorities. Claiming terrorism has provided justification to suppress self-determination in Kashmir, the most militarized zone in the world.

Concerns for national security have also dominated new policies in India, like the Citizenship Amendment Act and National Registry of Citizens, that aim to create a monolithic Hindu supremacist state.

Avoiding condemnation

By designating Sikh separatists or Khalistanis as “terrorists,” India has escaped widespread domestic condemnation for its alleged involvement in Nijjar’s murder.

In India, in fact, the term “Khalistani” is often seen as synonymous with terrorism. It functions as a stigmatizing label to justify lethal violence against Sikh separatists.

In the past, Modi’s Hindu nationalist government has dismissed any form of Sikh dissent by categorizing it as Khalistani. In 2020 and 2021, when thousands of Sikh farmers protested new farming laws, the government attempted to discredit the movement by saying that it had been infiltrated by Khalistanis.

Nijjar’s death could indicate India’s willingness to use state violence against Sikh separatists outside India. In the 1980s, in face of a state-sanctioned pogrom, many Sikhs fled India seeking asylum in Canada and elsewhere.

Today, India targets Sikh political dissidents around the world by labelling them “Khalistani terrorists.” There is widespread speculation India has been violently attacking Sikh activists around the world in violation of international law.

International policing agencies are resisting Indian pressure and refusing extradition requests against Sikh political dissidents.

Meanwhile, evidence is mounting that suggests India was involved in Nijjar’s assassination.

If it turns out India was in fact involved, Nijjar’s death should be regarded not only as an extrajudicial killing but also as an act of state terror — an ideologically driven attempt to quash the Sikh separatist movement by instilling fear among Sikh communities around the world.

With the War on Terror, the U.S. and its allies set the stage for countries to justify state violence under the guise of combating terrorism.

It should come as no surprise that India is emulating the West.

Under the leadership of a right-wing Hindu nationalist government, India is providing similar justifications for events like the murder of Nijjar.

Written by Omar H. Fares, Toronto Metropolitan University, and Seung Hwan (Mark) Lee, Toronto Metropolitan University. Photo credit: Shutterstock. Originally published in The Conversation. 

Cutting back on pricier food items and focusing on more affordable staple foods could help consumers deal with rising food costs, but these strategies affect brand loyalty.

As Canadians grapple with the rising cost of living, many consumers are reevaluating their daily choices and purchase habits. The cost of groceries is forcing many households to make difficult decisions, like having to choose between food quality and affordability.

Amid these economic pressures, the concept of brand loyalty — the preference consumers have for a particular brand over others — is undergoing a significant shift. Brand loyalty is the result of a mix of factors, including trust, habit and the perceived value of goods.

Brand loyalty significantly benefits retailers by boosting sales. Not only do existing customers spend more money than new customers, but brand loyalty also reduces the amount brands need to spend on advertising. Effective loyalty programs increase customer retention and result in positive word-of-mouth, meaning companies can spend less on marketing.

Losing loyalty, on the other hand, can result in a competitive disadvantage for retailers. It can lead to revenue loss, increased marketing and customer acquisition costs and negative word-of-mouth.

Once a cornerstone for many food retailers, brand loyalty is eroding as consumers prioritize immediate cost savings over long-term brand relationships.

Nearly seven million Canadians are struggling to put food on the table. Video credit: Global News.

Adapting to rising food costs

Inflation is impacting a wide range of income groups: 81 per cent of lower-income, 50 per cent of middle-income and 35 per cent of high-income earners in Canada are impacted by inflation, spending less on clothing, beauty products and big-ticket items.

Consumers have been adopting various strategies to manage their budgets. Three-quarters of Canadians say they dine out less often because of the rising cost of living, and 70 per cent say inflation has shifted the way they cook.

Despite rising grocery prices, eating at home is still more budget-friendly than eating out and allows for better control over the cost of ingredients.

Some Canadians are also modifying their eating habits by altering portion sizes, cutting back on pricier food items and focusing on more affordable staple foods. While these changes help consumers deal with rising costs, they also come at the expense of brand loyalty.

The digital landscape is also playing a key role in this shift. Consumers are increasingly turning to digital platforms to find economical food options. The convenience of online marketplaces and food delivery services exposes them to a wide array of product choices and competitive pricing.

Consumers also use online tools like coupons and price comparison options to seek discounts. Loyalty programs lose their appeal when consumers prioritize immediate savings.

This transparency and the ease of comparing prices online encourage consumers to explore various brands, making it more challenging for traditional food brands to sustain customer loyalty.

Changing consumer priorities

As prices rise and budgets tighten, consumers are more inclined to seek out more cost-effective options, which often means abandoning favourite brands in pursuit of better value.

One report found that 42 per cent of consumers now seek sales or shop clearance, 40 per cent adhere to a budget, 28 per cent buy less overall and 25 per cent prefer bulk stores or warehouse retailers.

In pursuit of cheaper alternatives, consumers become more open to trying private-label or store-brand products, discounted brands and generic or unbranded options. These alternatives provide shoppers with a practical way to cope with rising prices, allowing them to manage their expenses while maintaining a satisfactory level of product quality.

Inflation also leads to changes in spending habits in a phenomenon known as consumption smoothing. This often involves delaying the purchase of durable goods, prioritizing the purchase of necessities and opting for store-brand products.

In essence, consumers shift their priorities toward cost management, which in turn reduces their loyalty to specific brands. Food companies need to adapt to these changing consumer needs by recognizing affordability and value take precedence in an inflationary market.

What can retailers do?

The shift away from brand loyalty can pose challenges for business owners and retailers who depend on consumer spending. Aside from the most obvious solution to the issue — lowering prices — there are other things retailers can do to win back customers.

First, retailers can use dynamic pricing, allowing them to adjust prices based on factors like supply and demand, inventory and competition. This approach enables them to offer competitive prices and discounts while also minimizing food waste.

Second, retailers can also introduce loyalty programs that go beyond conventional point-based systems. By using personalized data from consumers, retailers can tailor rewards and incentives to match individual shopping habits, experiences and preferences. Retailers can also collaborate with other businesses and incorporate gamification elements to further enhance loyalty.

Lastly, retailers should consider using a value-oriented marketing approach to elevate consumer experiences. Retailers should communicate the value of their products, emphasizing quality, nutritional benefits and unique features to justify their price points.

Simultaneously, investing in exceptional customer experience, both in-store and online, can foster strong emotional connections between retailers and consumers. When consumers feel valued by brands, they are more likely to stay committed to that brand’s products. By assuring customers of their commitment to value, retailers can play a crucial role in guiding consumers through these challenging times.

Written by Nicholas Li, Toronto Metropolitan University, and Tracey Galloway, University of Toronto. Photo credit: The Canadian Press/Sean Kilpatrick. Originally published in The Conversation. 

A person walks along a path in Iqaluit on March 6, 2019.

Soaring food prices, growing profit margins and record-high profits in the food industry have severely impacted the lives of many Canadians. According to Industry Minister François-Philippe Champagne, Canada’s largest grocery chains recently agreed to work with the federal government to stabilize prices.

But for Canadians living in remote northern communities, food affordability has been a crisis for decades. Grocery prices are routinely two to three times higher in Northern Canada.

These high food prices, combined with limited economic opportunities and high rates of poverty, have led to Northern Canada having the highest rates of food insecurity in the country. Almost half of all Nunavut households are moderately or seriously food insecure.

The federal government’s main policy to tackle this is a program called Nutrition North Canada that was launched in 2011. The program pays $131 million a year in subsidies to retailers based on the weight of eligible food they ship by air to communities without year-round surface transportation.

Subsidy rates vary based on the remoteness of communities as well as item type. For example, milk receives the highest subsidy, orange juice receives a lower subsidy and potato chips receive no subsidy.

Under the program, retailers sign an agreement promising to pass subsidies on to consumers in a process known as a “pass-through.” This means that if the government pays a retailer $1 to ship an item, the price of that item should be $1 lower for consumers.

However, residents of these communities have expressed concern that retailers may be taking advantage of them and using subsidies to increase their profits.

Insufficient accountability measures

To determine how much of the Nutrition North Canada subsidy was passed on to consumers, our recent study examined how much subsidy increases in October 2016 and January 2019 lowered food prices. We controlled for factors like food inflation, energy prices and high freight/operating costs.

We found that for every dollar paid to a retailer to reduce shipping costs, the prices paid by consumers fell by only 67 cents. When we considered communities with a single grocery retail store affected by the January 2019 subsidy increase, we found that an extra dollar paid to retailers reduced consumer prices by only 26 cents.

Our main finding — that the subsidy was not fully passed-through to consumers — remained unchanged when we considered only the most perishable goods, or accounted for economies of scale in shipping and other community characteristics.

Our findings indicate that Nutrition North Canada’s accountability measures are insufficient. Despite the publication of data on the subsidy and the price of a retail basket, and the existence of an auditing mechanism to ensure compliance with the program’s requirements, a substantial share of the subsidy is being captured by retailers.

The biggest retailer in the region — the North West Company — is a profitable, multi-billion dollar company that receives over half of the subsidy because these communities face far less competition than in the rest of Canada. According to the North West Company’s website, it “uses the entire amount of the subsidy to reduce retail prices for shoppers.”

Better addressing the problem

Why do existing accountability measures fail? First, it’s difficult to measure subsidy pass-through and retailer margins, especially with traditional audits. The contribution of retailer profits to high food prices today is still being debated.

Second, it may be even harder to punish retailers in this setting. A substantial share of the subsidy still goes to consumers, so punishing retailers by removing the subsidy would make food even more expensive.

How, then, can the federal government better address the problem of food affordability and insecurity in remote northern communities? Recent additions to the Nutrition North program, like the Harvester’s Support Grant, are a response to communities demanding more control over their food systems. This could involve subsidizing traditional hunting activities and funding community-led initiatives to support those in greatest need.

While these measures are promising, they are unlikely to replace the importance of store-bought food shipped by air. Measures to increase competition may help since retailers in these communities face far less competition than in the rest of Canada, but it’s still challenging for small, remote communities to have substantial competition.

While price controls and state-run stores (such as those in Greenland) could be worth exploring, they also have pros and cons that need to be carefully considered.

A simple and more market-friendly approach would require retailers to publish the price of all subsidized goods online. Greater transparency about food prices would help communities and their leaders hold retailers accountable in the court of public opinion, and make analyses like ours easier to conduct. While not a standalone solution for food affordability and insecurity in these communities, it could ensure more of our tax dollars go to support those in need.