5 people to watch in Business in 2019

5 people to watch in Business in 2019

Catherine McKenna, 47, will be ubiquitous in making the case for the carbon pricing that Trudeau has imposed on the entire country, as he long ago vowed to do.

McKenna has the right stuff for the job. Among the most impressive delegates at the landmark Paris climate-change summit in 2015, McKenna helped her boss successfully press for more ambitious CO2 emission targets than the worldwide summit delegates thought possible.

In 2019, McKenna will be her government’s highly visible advocate of a carbon-pricing system that is revenue neutral and, according to the consensus of global climate-change scientists, a precondition to our species’ survival.

As the World Bank points out, more than 70 jurisdictions worldwide have adopted carbon pricing, which reduces health care costs and creates jobs in alternative-energy and other fields.

But McKenna is caught between environmental activists who fault what they believe is a Trudeau government’s mere “gesture politics” in fighting climate change; and excoriation, notably in the four holdout provinces against shifting the costs of pollution from the public to polluters, as guilty of a federal tax grab that will kill jobs. And McKenna is hobbled by an occasional imperious dismissal of extreme views on both sides.

If she can master the diplomatic skills on this issue that cabinet colleague Chrystia Freeland, the foreign minister, has demonstrated on trade disputes, McKenna stands to inherit Freeland’s 2018 status as Trudeau’s “star minister.”

Bruce Linton, founder and co-CEO, Canopy Growth Corp.

Bruce Linton says Canopy Growth must become a “Google-like” company, both dominant and ubiquitous.

As North America’s first publicly traded marijuana firm, Canopy Growth has a head start on other players. But giant pharmaceutical, beverage and tobacco multinationals crave a piece of a global pot market expected to hit $150 billion (U.S) in revenues by the mid-2020s.

Linton is determined to expand Canopy Growth’s geographic footprint beyond the 11 countries in which it operates.

Linton, 52, is also investing across the spectrum of pot-related firms, from marketing and distribution firms to makers of niche products (edibles, nasal sprays, gels, sleep-inducing teas and the like). And Linton is determined to achieve dominance in medicinal marijuana, which boasts a faster growth rate than recreational weed.

Doctors and patients are taking an increasing interest in pot’s potential in non-psychoactive pain relief and treatment of conditions including arthritis and childhood epilepsy.

Pot also holds promise as a safe alternative to the opioids whose improper use is a public-health crisis. In its latest quarter, Canopy Growth generated about 10 per cent of its sales from the roughly 1,000 German pharmacies it supplies.

Canopy’s in-house health divisions are developing cannabis-related treatments for insomnia in people and anxiety in dogs.

Linton’s ambitions are backed by a $3.8-billion (U.S.) investment in Canopy Growth by U.S. liquor firm Constellation Brands Inc., maker of Corona beer. As it happens, Linton is wary of the proliferation of cannabis beverages. “They’re gross,” Linton says of the many foul-tasting beverages in a market niche that awaits better recipes.

Donald Tusk, president of the European Council

Donald Tusk has a formidable to-do list in 2019.

Tusk will continue to be the highest-profile exponent of the hardline European Union position on Brexit, a nightmare that could drag on through 2019 as an undecided U.K. flirts with a second EU referendum.

Meanwhile, EU immigration practices seen to be lax have fuelled nativist populism across the continent, and migration reforms are urgently needed.

Germany and France are pressing for overdue financial-markets reforms to prevent a recurrence of the European economic crisis. But among these is a call for pan-EU budgeting that ties bailouts to potentially wrenching austerity and labour-market reforms that already are meeting resistance, conspicuously from Italy’s new populist government.

Real and perceived Russian undermining of EU unity and American belligerence toward an EU it has labelled a “foe” of America have prompted France’s call for all-out war on cyber-attackers and a first-ever European army as a counter-balance to the U.S.

The latter isn’t playing well with postwar anti-militaristic Germans. Meanwhile, populist EU governments in Italy, Hungary and Tusk’s native Poland, in violating cherished EU human-rights principles, are candidates for EU expulsion. And a strategy for bulking up high-tech prowess is needed by an EU losing ground to both Silicon Valley and the Pacific Rim.

Tusk, 61, has been successful in getting the EU’s 28 varied national cultures (save Britain, obviously) united on most crucial issues, notably Brexit. But Tusk’s multitasking skills in constructively guiding so many fiercely debated reforms in 2019 will be stretched to the limit.

Michael Medline, CEO, Empire Co. Ltd.

Canada’s most successful major-company turnaround CEO of 2017 is actually just half-way done with his comeback plan of boosting operational efficiencies at Canada’s no. 2 grocer by about $500 million per year by 2020.

And there’s more.

In the midst of a turnaround of the basic business, Michael Medline, 55, paid a steep $800 million in 2017 for Ontario grocery chain Farm Boy. Because of a Farm Boy business formula in sync with changing consumer preferences, a Farm Boy chain with just 26 stores was able to generate 2017 revenues of about $500 million.

Farm Boy is a Whole Foods without the sticker shock and a Trader Joe’s without the snooty attitude. It boasts above-average profit margins, small-store intimacy, and customer loyalty.

One of Medline’s unspoken priorities this year is to begin transplanting the winning Farm Boy culture on Empire’s other grocery banners — Sobeys, Safeway, IGA and FreshCo.

On still another front, mastering home delivery is a priority for a grocery industry under threat from Walmart and Amazon. Using the GTA as a pilot project, Medline over the next two years will deploy the trailblazing model of the U.K.’s Ocada Group PLC, with which he inked a deal in January 2018, to provide automated fulfilment of home-delivery orders.

Only if the model works in Canada’s biggest city will Medline roll it out across the country.

Empire stock has recovered by 74 per cent during Medline’s two-year tenure. But with 2017 profits 62 per cent below their 2015 peak, Empire still has upside potential if Medline continues to deliver.

Rachel Notley, Premier of Alberta

Rachel Notley heads into an Alberta election year with the only Canadian province in economic crisis.

For lack of adequate means to get landlocked Athabasca oil to market, Alberta has been effectively giving away its oil, priced at a mere $18 (U.S.) a barrel in December compared with the $55 (U.S.) benchmark price for lighter oil grades produced elsewhere.

Notley has responded with drastic steps, including an 8.7 per cent cut in Alberta’s 2019 oil production, plans to buy as many as 7,000 rail cars to get Alberta oil to market, and a search for partners to build a refinery enabling Alberta to export more high-value oil.

Fortunately, relief is on the horizon.

As recently as January 2018, a recovery in the world oil price enabled Alberta to restore most of the jobs lost from the epic oil-price collapse earlier in the decade.

A second — milder but damaging — price drop in 2018 was largely caused by the shutdown of U.S. refineries able to process Alberta’s heavy oil. The overhaul of those refineries will be completed this spring.

None of those factors provide the immediate relief Albertans need. But they do give impetus to Notley’s persuasive case, in her ambitious 2016 Alberta Jobs Plan, for diversifying both Alberta, from its reliance on oil, and the oilpatch itself, from its paucity of refining capacity.

Notley’s December call to action — “Let’s start making more of the product that the world needs right here at home” — is likely to be a rallying cry in her 2019 re-election bid.

David Olive is a business columnist based in Toronto. Follow him on Twitter: @TheGrtRecession

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