The energy industry must start to build public trust or it will face consequences
Canada’s oil and gas sector faces a fundamental and often overlooked challenge: a widespread lack of trust from the general public. Outside the industry’s echo chambers, it’s rare to find an “ordinary Canadian” who enthusiastically supports petroleum.
This pervasive distrust has significant implications, especially as recent changes to the federal Competition Act (via Bill C-59) empower environmental activists with new tools to combat greenwashing. Greenwashing involves making false or misleading claims about a product’s environmental benefits.
That lack of public trust is problematic in more ways than one – especially when we have a federal government hell-bent on making environmental activist organizations de facto regulators of all things green. The recent changes to the Competition Act that have tightened greenwashing provisions allow environmental activists to use their new “private rights to action” tools to take collective legal action against the sector after waiting only one year.
This shift represents a significant change in the regulatory landscape, giving environmental groups unprecedented power to hold companies accountable for greenwashing. Federal politicians, understanding public sentiment and the political climate, have enacted these changes because they fit within what the political middle ground finds acceptable. This concept is explained by the Overton Window, introduced by Joseph Overton, which describes the range of politically viable policies at any given time.
The oil and gas sector has been caught off guard by these changes because it hasn’t acknowledged its trust deficit. The industry has become insular, preferring to engage within its own bubble rather than reach the broader public. This insularity is evident in its frequent use of self-referential language and a siege mentality, where it’s easier to talk among themselves than to engage with those outside their immediate sphere. We often hear calls to “change the conversation” and shift from an “or” to an “and” discussion, but these have yet to result in meaningful action.
Understanding and leveraging the Overton Window is crucial for the energy industry. The recent changes to the Competition Act were within the acceptable range of public opinion, leading to their swift implementation. This should serve as a wake-up call for the industry: it needs to earn trust, or “trust capital,” from outside its echo chambers. Trust capital is a type of social capital, involving shared values and resources that enable collaboration and the achievement of common goals.
Social capital, a concept often overlooked by the technically focused energy industry, is critical to building trust. According to Investopedia, social capital is a set of shared values or resources that enables individuals to work together effectively. This inherently includes trust. Building social capital involves strengthening relationships with partners and customers, enhancing market reputation, fostering collaboration, and boosting employee loyalty and engagement.
To gain public trust, the energy sector must invest in social capital by honestly and humbly engaging with Canadians about their views on greenwashing and their expectations for transparency and truth in advertising. It must set aside arrogance and genuinely listen to the public, acknowledging its vulnerabilities and accepting that public trust must be earned through consistent, transparent actions.
Bill C-59 offers the industry an opportunity to engage with the public and understand their perspectives. But to effectively build trust, the industry needs to adopt a new mindset and recognize the importance of social capital and trust as essential components of its business strategy. It needs to engage with the public in a way that is transparent, accountable, and responsive to their concerns. While this might mean making difficult changes to how it operates, these changes are necessary for long-term success.
For example, the industry could launch public consultations to gather input on environmental practices and greenwashing. These consultations should be widely publicized and designed to encourage participation from a diverse cross-section of Canadians. Additionally, the industry could commit to regular, transparent reporting on environmental impacts and sustainability efforts, providing clear and accessible information to the public.
Furthermore, building public trust requires a change in how the industry communicates. Instead of using technical jargon and industry-specific language, it needs to use plain language that is clear and relatable to the average Canadian. The industry should be honest about the challenges it faces and highlight the steps it is taking to address them.
Investing in social capital and building trust is not just about improving the energy industry’s public image; it is about ensuring its long-term viability. By earning the trust of Canadians, the industry can create a more favourable regulatory environment, foster stronger relationships with stakeholders, and ultimately achieve greater success.
While this will not be an easy task, it is essential.
Bill Whitelaw is a director and advisor to many industry boards, including the Canadian Society for Evolving Energy, which he chairs. He speaks and comments frequently on the subjects of social licence, innovation and technology, and energy supply networks.
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