In the sitcom How I Met Your Mother, there was a running joke about how Canadians are scared of the dark. At the time, I didn’t really get it, and maybe I still don’t. But I’ve come to think that light-hearted remark might hold more insight into Canadian corporate life than pretty much any academic, journalistic, or consultancy take, provided you make one small edit and replace “the dark” with “the unknown.”
What makes this odd is that the foundational myths of Canada are ones of almost reckless daring. It is a country built by peoples who mastered extreme climates for thousands of years, paddled canoes across a continent, challenged the power of an expansionist United States, drove a railway through the Rockies, took Vimy Ridge, and isolated insulin in a Toronto lab. Successive generations of immigrants crossed oceans on the strength of a suitcase and a rumour of work. Canada is about people who walked into the dark deliberately.
So, why do the same Canadians who think nothing of climbing a mountain or jumping out of a helicopter to ski untracked backcountry, for fun on the weekend, become remarkably cautious once they come to the office and slip a lanyard around their neck?
When an unfamiliar idea gets escalated in the workplace, it is usually to someone whose main qualification is twenty years of successfully avoiding unfamiliar ideas. Canadian corporate and political leaders are considered sober, responsible, and a little dull. New things are risks. It’s why the unusual resume will find itself in the recycle bin or just end up at the bottom of the pile. Any new proposal will be sent away for further review, by multiple stakeholders, and anything that hasn’t already been done somewhere else is met with that most Canadian of rejections, which goes something like: “This is really interesting. . . . Thanks for bringing it up! But it could use a bit more study, maybe an impact assessment, or two. Anyway, we’ll get back to you, OK?”
Now, Canadian business types will explain this sluggishness and reticence by blaming it on Ottawa. They’ll tell you it’s regulation, red tape, a swelling public service, a lack of incentives. Some of that is perfectly fair. But having spent a good part of my career inside Canadian companies, I’m quite sure the fear of the dark is at least as well established in the private sector boardroom as in the public sector bureaucracy, and it is remarkable how rarely anyone points a flashlight in that direction.
I. The View from the Bank Office
Allow me to illustrate the thesis with some examples: A friend of mine joined one of Canada’s big banks after many years of senior work abroad and a seven-month job search. By the time she got a job offer, it was obvious to her and to pretty much everyone at the office that she was underemployed and overqualified for the position. For months, she was told by prospective employers that Canadian firms needed people with experience from the US, the UK, or Europe, since “our systems are so far behind other markets.” And yet the offers were junior, sometimes part-qualified, and were it not for the need to work, beneath her. The job she ended up getting was little different.
She raised it with a senior executive. And what surprised her was how readily he agreed. The executive accepted the point entirely and then explained that this was simply how Canadian corporate culture worked. The bank did not want to be seen rewarding international experience; newcomers from elsewhere, however accomplished, were expected to sit a rung or two lower for a while and “learn Canadian culture” or acquire “Canadian experience.” He then set out the model, in roughly the tone you might use to explain the offside rule (hockey or football, take your pick):
In the first year, you don’t really know how to do the job. In the second, you do it properly. In the third, you repay the bank for the faith it showed in hiring you.
I have thought about that exchange a great deal since because it is so revealing about what the institution actually values. If you set out to design a system for converting talent into loyalty at the worst possible rate of exchange, well, you could hardly improve on it. The organization pays someone to relearn a job they had already mastered, describes the lost year as an investment and then effectively invoices them for a further year of gratitude! In a university fraternity, this would be called hazing. But in Canadian banking, it comes with a balanced scorecard.
Recall the meme where a caveman proudly presents the first wheel and is promptly dismissed by the rest of the tribe, who are perfectly happy dragging their rocks. The Canadian corporate outlook is just that: the incumbent executives can see the promise of the wheel quite clearly but nonetheless want the enlightened to keep dragging their knuckles with the others instead.
This isn’t one bank’s eccentricity. I’ve seen it play out dozens of times. Canada selects some of the best-educated immigrants in the world and then, with impressive consistency, parks them in jobs well beneath their qualifications. Lots more come and have a look at what Canada can offer, and the lifestyle is appealing, but the work prospects are alienating. The engineer driving a taxi has become a national cliché, and the executive marking time in a junior role is the same story. We tend to file both under immigration policy, when they are really hiring decisions, made one interview at a time by people who would happily describe themselves as champions of diversity.
The same goes for local, Canadian-born and educated young people, who encounter barriers to advancement. They spend years acquiring often out-of-date credentials in an education system that has a bias for teaching axioms rather than critical thinking, even as business school professors talk about theories of innovation and disruption. As they enter the labour force, they then discover that employers are reluctant to give them the opportunity to put into practice the skills they’ve developed, or indeed, any creative or novel proposals they might happen to have.
Entry-level positions typically demand unrealistic years of experience, established networks count for more than demonstrated ability, and employers complain of talent shortages while overlooking the talent right in front of them. The result is a labour market that systematically underuses its own human capital, whether acquired abroad or trained at home.
And the saddest part is that when young or international hires finally do get to climb up the career ladder, they will likely have internalized the same risk-averse habits and dispositions as their predecessors, seeing it as “just the way things are done around here” and ensuring that the same sensibility is passed from one cohort to the next, never to be challenged from within or without.
II. The Pilot Pathology
This way of thinking doesn’t stop at recruitment. It plays through in day-to-day work too, for Canada is the heart of the zombie pilot.
The ritual is depressingly familiar: a technology that has been running happily at scale in London, Singapore, or even Nairobi for the best part of a decade eventually reaches these shores, where, rather than being adopted, it is “piloted.” There will be a press release, a steering committee, and a carefully chosen group of users in a tightly controlled place. Eighteen months later, the pilot is declared a success, astonishing nobody, since it had already succeeded everywhere else, and it then shuffles on for another year or two, neither alive nor dead, waiting for someone senior enough to take the personal risk of switching it on properly.
Worse still, the pilot is delivered so half-heartedly, the thing that works elsewhere fails, and the Canadians can go back to the way things were before, with the aloof mindset that they are a unique species who had it right in the first place.
Toronto offers a version where you can stand on the sidewalk and watch this play out. The King Street Transit Pilot, launched in 2017, did what tram cities from Amsterdam to Berlin to Melbourne have been doing for decades, which is to give the streetcar priority over private cars in a dense, urban area. It worked, much as anyone who had ridden a tram abroad could have predicted, though not before one restaurant registered its feelings by carving a middle finger out of ice. Having proven the point as journey times dropped, ridership increased, and congestion improved, the obvious next step was to build on it properly, with a redesigned street layout, better track, proper switches, more sensible stop spacing, and the rest of what tram cities have long since worked out.
None of that needed another pilot. Instead, the temporary arrangement was simply left to rot, and Toronto’s streetcars remain among the slowest in the world, crawling through congestion they were never meant to share. All of this is known, and yet nobody acts on it. That example belongs to City Hall, and I mention it because the habit plainly runs through Canadian institutions of every kind, Bay Street very much included.
The interesting question is what all this is for. An experiment is normally a way of finding out something you don’t know, yet the Canadian pilot is almost always applied to things whose outcome is already known, which suggests it is serving some purpose other than discovery.
My suspicion is that its real function is insurance. People used to say that nobody ever got fired for buying IBM, and the Canadian corollary is that nobody ever got fired for piloting something the Americans, Europeans, or maybe the Aussies did first. (You’re best off not using Asia or the Middle East as an example because a Canadian will tell you there is nothing to learn from there because “we’re fundamentally different”).
The executive who waits until an idea has been proven in three other countries is seldom punished for the delay, whereas the one who tries something genuinely new and misses tends to be remembered for it. When the downside of a risk falls on you personally and the upside goes to the company, the rational course is to keep your head down, protect the margin, and commission another pilot.
In Britain, up-and-coming future leaders will find a way to get ahead by trying something new while knowing the employment law makes it exceptionally difficult to get the sack. The worst-case scenario is that you might get “slow horsed” out of the business. This is demoralizing, for sure, but the salary means the mortgage is still paid and the kids fed. In the United States, you can be fired very quickly for failure, but the Americans in their eternal optimism are especially good at framing a failure as learning. In Canada, failure will have you exited fast, only the metaphorical dunce hat will mean the smell of failure lingers. It’s not a sign that someone has learned something or gained useful knowledge, but a warning signal that this person is a danger.
I had my own encounter with this dynamic some years ago, while working on proposition design for what was then the new Aeroplan. A senior Air Canada executive liked one of our ideas very much and said so. “Iain, it’s a great idea,” he told me, “but we might be interested in doing it once United or British Airways do it first. We can’t be the first flag carrier to make such a change, even if customers might like it and it makes financial sense.” At least they said the internal logic out loud! Customer appeal and financial sense were conceded, but neither was considered sufficient. What the idea lacked was permission, and permission, it turned out, could only be issued from someone else, even someone who didn’t even work for the same company, in Chicago or London.
But not even the most arrogant corporate leader expects to be right all the time. The aspiration I’d suggest though is to be “more interestingly less wrong” by placing bets that teach you something, to wander off now and then, and occasionally come back with news of an insight, a discovery, or a piece of fortune. Canadian business has optimized for something closer to the reverse, preferring to be wrong in a boring, safe, and collectively assuring way, and in good company when it happens. Canadian-style progress tends to taste like a plain cheese pizza: delighting no one, but offending no one either.
This is how a country ends up being very good at sanctioned academic research on the one hand, and piss poor at turning it into companies on the other. Canadians can invent the thing (if permitted), but someone elsewhere builds the business out of it, and a decade later, Canada will run a pilot of their version of our thing.
III. Capital and Corporate Kink
Let’s go back to money. A Bedouin in the Arabian desert can send money from a mobile phone more easily than many Canadians can move it between their own accounts at two different banks. I’m not joking, as I’ve seen seminomadic people living across the Jordanian-Saudi border move sums of money instantly, whereas I had to spend twelve days and multiple branch visits moving between three Canadian banks. Kenyans have been paying one another by phone since M-Pesa launched in 2007. Brazil’s Pix went from launch to national habit in a couple of years. Alipay effectively eradicated card-based payment in China. And India’s UPI handles billions of transactions a month. Canada has Interac, where there can be fees, your recipient might need a code, and it only works up to a certain transaction limit.
Canada has been discussing open banking since at least 2017, when I moved here, and discussing it very thoroughly indeed, with consultations, advisory committees and frameworks, and a launch that became a phased launch and then the first phase of a phased launch. Real-time payments have followed a broadly similar itinerary. At no point was the technology the obstacle, since it existed, worked, and was in daily use elsewhere. What was missing was an industry with any enthusiasm for cannibalizing its own fees. A domestic banking oligopoly will do that.
The blame naturally lands on “the system,” meaning the regulators, the legacy infrastructure, and the Ottawa process. In this case, though, the system consists largely of the incumbents themselves, together with a regulator that has learned to wait for them to tell it what to do. When the people who would have to change are also the people who profit from things staying as they are, it seems generous to describe the resulting delays as accidental.
In March 2024, somebody did finally point a flashlight at the boardroom. Carolyn Rogers, senior deputy governor of the Bank of Canada, gave a speech titled “Time to Break the Glass” in which she described Canadian productivity problems as an emergency. More interesting than the alarm was where she located the cause. Alongside the usual points about regulation, she pointed to a number of factors that the conventional discourse tends to overlook, ranging from weak business investment in machinery, equipment, and intellectual property; to firms whose comfortable margins and secure market positions gave them little reason to become more efficient; and to what she described plainly as a risk-averse business culture.
That last phrase deserves particular emphasis, and an anecdote from Rory Sutherland about bees helps explain why. When a bee discovers a source of pollen, it returns to the hive and performs a waggle dance, directing the others to its location. Most dutifully follow, efficiently exploiting a known resource for the benefit of the colony. But a minority ignore the signal and buzz off in other directions. These disobedient bees might appear to be wasting their time, contributing little to the collective effort while their more industrious companions get on with the work. Yet when the established source is exhausted, as it inevitably will be, it is precisely these wanderers that may have discovered the next one. They return to the hive, perform their own dances, and lead the majority toward new opportunities, while a few others continue exploring. Without this balance between exploitation and exploration, the hive would eventually exhaust its resources and perish. What Rogers described, in suitably central bank language, is a hive that has deliberately designed itself to eradicate its disobedient bees.
We need the equivalent of disobedient bees in Canadian institutions: in Ottawa, on Bay Street, in our private enterprises, and in the civil service. Since this came from the central bank rather than from someone holding a placard, you might have expected it to start a national conversation about how Canadian companies behave. What followed was more instructive. A little over a year later, the C.D. Howe Institute upgraded the emergency to “four-alarm” and then prescribed remedies almost entirely for government only: among the report’s proposals were to override investment-stifling regulations, overhaul immigration and competition policy, cut the corporate tax rate or introduce an investment tax credit.
Any or all of those may well be worth doing. What I find fascinating is the sleight of hand. The diagnosis named two patients, the public and private sectors alike, and yet the prescription treated one, so that business entered the consulting room as half the problem and left as the blameless victim of Ottawa, clutching a request for another tax cut. The trick works reliably because the business press, the major think tanks, and the lobby groups share a dialect in which every road eventually leads back to the state, carefully shielding the Canadian business class from even a hint of critical scrutiny—and wilfully ignoring how the culture of bloat, mediocrity, and risk phobia is effectively shared between state and market actors.
The numbers take a different route. In 2008, for every dollar American businesses invested in machinery and equipment per worker, Canadian businesses invested about 63 cents, but by 2025 the figure was roughly 32 cents. Over that period, governments of both stripes came and went, corporate tax rates fell, and then stayed put and profits in many sectors were extremely healthy. The one constant through two decades of decline was a long series of investment decisions taken, one boardroom at a time, by Canadian executives. Ottawa did not make these decisions against investing in corporate Canada’s future through the purchase of new machinery and technology.
The pattern repeats with the intangibles as business spending on research and development in Canada has hovered around 1 percent of GDP for years, well under half the American level, which makes us a country that is good at producing ideas and curiously reluctant to own them. The productivity gap everyone frets about is in large part the accumulated bill for those choices.
All of which brings me, perhaps unexpectedly, to kink (please, do stay with me here).
If you were looking for a social system designed for experimenting in situations that carry real risk, you would struggle to find a more sophisticated one. Kink rests on an architecture of consent, in which desires, limits, and boundaries are discussed in advance; a safe word is agreed upon; and aftercare is planned for. Within that structure, people are free to explore some pretty wild stuff, and the structure exists precisely so that they can. The whole arrangement is designed for discomfort, for the things that make your heart race a little and invite curiosity over certainty.
That combination is exactly what innovative cultures require: providing permission to explore, permission to fail, and permission to talk honestly afterwards about what worked and what didn’t, which is a longer way of saying psychological safety. Canadian companies are hardly short of structure, what with the extensive stakeholder maps, the rounds of review, multiple sign-offs, the risk registers, and the slow-moving pilots. But very little of it is there to make exploration safe, to expand the opportunities to get lucky, and a great deal of it is there to make exploration unnecessary.
In that sense, the zombie pilot is a close cousin of the endless stakeholder consultation, leaving everyone with the pleasant sensation of saying they do innovation without anyone having risked anything or exposed themselves to any vulnerability at all. And when you remove any form of risk, you remove any opportunity for learning or evolving.
This principle, which we might call “corporate kink,” has something to teach about power, too. We raise leaders to believe that control is currency and that leading means always being in charge and never yielding, so they learn to perform confidence while carefully avoiding risk. In kink, the arrangement is often inverted, and the real power lies with whoever is brave enough to name what they want and invite others in to explore it.
The best leaders know when to yield. Canadian boardrooms rarely do, and on the whole, would rather keep a firm grip on a shrinking market than loosen it long enough to go looking for a new one. Having spent several decades politely declining to explore the unknown, Canadian business has lately taken to complaining that nothing changes.
Of course, criticizing a culture is easy enough; changing the habits and incentives that sustain it is rather harder, which is why we must eventually turn from diagnosis to prescription.
IV. What Is to Be Done?
My complaint about Canadian capitalism is the opposite of the one people usually expect from someone writing an essay like this, in that I think it is far too gentle and genteel.
At the end of the day, strong, resilient businesses are generally forged by competition that actually produces some damage and discomfort, by rivals who would cheerfully eat your lunch and customers who would leave tomorrow if something better came along. Our largest companies have rarely had to endure much of that. You just have to look at where Canadians spend most of their money and patience, in telecoms, banking, groceries, and air travel, and you find a handful of reliably profitable players in each—not just at the surface, but in the supply chains underneath, regularly ranking them among the most expensive or least competitive industries in the developed world. The arrangement resembles something more like a distressed purchase in a departure lounge than a market of free choice.
Comfort of that kind produces precisely the culture I’ve been describing. If your position is secure, there is little reason to hire the qualified outsider who might unsettle things, to launch the pilot properly, or to buy the new machine when the margin is perfectly satisfactory as it is. Even our start-ups, who are meant to be the rebels, pick up the habit. Founders build something genuinely promising and then sell early to an American buyer for a comfortable exit rather than slog their way toward becoming a global company. No regulation obliges them to. It is a private choice about an appetite for risk.
Professional services have their own version. American firms are openly amused that their Canadian counterparts can need something like eight partners to close a fairly small deal. Some of those Canadian clients are less amused, to the point where they knowingly hire the American firm at higher rates simply to avoid the processes of the domestic one. Customers paying a premium to get away from you is about as clear a verdict as a market can deliver, and in a properly competitive one, it would be fatal. In Canada, it tends to survive as an anecdote told over drinks or essays like this one.
These difficult facts make the familiar argument between a bloated state and a dynamic free market rather beside the point, since it assumes the market half of the equation is dynamic by default. Canada has a slow state and a sheltered private sector, and the two get along extremely well: incumbents lobby for the moats that protect them, regulators defer to them as national champions, and it is for the citizen and the consumer to pick up the bill.
The thing most likely to shake a comfortable culture is a genuine threat, and in 2025, we were handed one in the form of tariffs from our largest customer and an American president musing about a 51st state. For a while, the country rediscovered its elbows, but what matters now is what Canadian boardrooms do with that moment. If they treat it as a reason to compete harder, invest more, and find new markets, it could turn out to be the best thing to happen to Canadian business in a generation. If they treat it mainly as a lobbying opportunity, another occasion to ask Ottawa for tax relief and shelter, we will have wasted a perfectly good crisis.
A threat is one of the very few things that can’t be put into a pilot. So, what do we do about it?
We measure government almost obsessively through the likes of deficits, debt ratios, borrowing costs, GDP growth, (un)employment, wait times, congestion, education levels; all of these are reported on extensively and eagerly deployed as political ammunition. Business, meanwhile, is mostly judged on numbers of its own choosing, such as earnings, share prices, and dividends, which tell you a good deal about whether shareholders are content and almost nothing about whether a company is building anything.
Therefore, I would propose a report card for the boardroom, published as routinely as the federal deficit. It should consist of the following items, which may be covered and debated with the same enthusiasm as the conventional economic metrics:
● Reinvestment rate: How much of every dollar in corporate profits is reinvested in productive capacity, and how much is distributed through dividends and share buybacks.
● Talent utilization: How many skilled workers, particularly internationally trained professionals, remain employed below their qualifications three years after being hired. Call it the year-three skills index.
● Pilot-to-launch rate: How many pilot projects become commercial products or operational improvements, how long the transition takes, and how many are openly acknowledged as failures. A company whose pilots never fail is probably learning very little, while the zombie pilots that neither succeed nor fail deserve particular scrutiny.
● Concentration and margins: Market concentration and corporate profit margins, measured sector by sector, to reveal where genuine competition ends and the comfortable club of incumbents begins.
● Scale-up rate: How many Canadian firms grow beyond 250 or 1,000 employees, how long they take to get there, and how many are acquired before reaching those milestones.
Much of this data already sits in Statistics Canada tables that few people read. It belongs on the front page, in the questions put to bank CEOs on earnings calls, and in the briefs of think tanks, whose prescriptions might then become as honest as their diagnoses. What we measure shapes what we argue about, and at present, we are measuring only half the economy.
Canada has no shortage of talent, capital, or ideas. We have bright and ambitious young people who graduate from strong educational institutions; we are also able to attract some of the most qualified people across the globe, often with invaluable work experiences. But we love nothing more than to direct them to roles that seem purposefully designed to constrain and qualify their prospective contributions. We have some of the largest pension funds anywhere, and yet our workers now get half the tools, relative to Americans, that they had in 2008. And we produce great innovations and technologies, only to pilot them a decade after everyone else.
The country of voyageurs and railway builders did not become what it is by being scared of the dark, and it would be no bad thing if our boardrooms remembered as much. It would be equally useful if the rest of us stopped assuming the whole problem lives in Ottawa. By all means, hold up the mirror, but expect a few of the faces looking back to be wearing expensive suits.
Iain Montgomery is a strategist and founder of Now or Never, a firm that helps companies dither less and do more.
Photo by "Many pictures," licensed under Creative Commons Attribution 4.0 International license.