The Advocate Magazine - May | June 2012

advocate M AY | J U N E 2012

Building Blocks for Tomorrow’s Economy Final of a Three Part Series

Investing in Education Immigrant Internship Program Grand River Hospital: A Thriving Health Centre for a Growing Community Putting Intellectual Property Rights Issues on the Map

advocate MAY | JUNE 2012 WWW.GREATERKWCHAMBER.COM

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EDITOR-IN-CHIEF:

FEATURE

Benefits of Canada’s Economic Action Plan 2012 on Waterloo Region Harold Albrecht, M.P.

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EDITORS:

Heather Hutchings, David Tubbs

FEATURE

Immigrant Internship Program

DESIGN AND PRODUCTION:

Lil Premsukh

Cober Evolving Solutions

COVER STORY

PHOTOGRAPHY:

Adamski Photography and Lisa Malleck Photography

Investing in Education John Baker

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ADVERTISING AND SALES:

FEATURE

Grand River Hospital: A Thriving Health Centre for a Growing Community Mark Karjaluoto

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Art Sinclair

David MacLellan – dmaclellan@greaterkwchamber.com Don Critelli – dcritelli@greaterkwchamber.com JR Waddell – jwaddell@greaterkwchamber.com Michelle Kienitz – mkientz@greaterkwchamber.com CONTRIBUTING WRITERS:

FEATURE

Putting Intellectual Property Rights Issues on the Map

Harold Albrecht, M.P., John Baker, Perrin Beatty, Brian Bennett, Sabrina Fitzgerald, Mark Karjaluoto, Ian McLean, Lil Premsukh, Art Sinclair

Perrin Beatty CONTRIBUTORS:

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FEATURE

Bryan Atcheson and Teri Hetherington

Chamber Star

ADVERTISING AND COPY DEADLINES:

May 18, 2012 for July | August July 20, 2011 for September | October Sept. 21, 2012 for November | December November 23, 2012 for January | February

departments 4 5

MESSAGE FROM THE CHAIR

The Importance of a Viable Manufacturing Sector

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Brian Bennett

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MESSAGE FROM THE PRESIDENT

Waterloo Region Economic Recovery is Moving Forward Ian McLean

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SUBSCRIPTION AND BACK ISSUE INQUIRIES:

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ADVOCACY

Continuing Postsecondary – Business Collaboration is Critical for Future Success

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Business Excellence Awards Winners AWARDS

Business Excellence Awards Guests

Spring Networking NEW CHAMBER MEMBERS

February 1, 2012 to March 31, 2012 EVENTS

Mark Your Calendar

Darlene Jones djones@greaterkwchamber.com SUBMISSION POLICY:

Proposals and articles are accepted via mail or email c/o Editor - Advocate. Please do not send originals.

All contributors articles must be accompanied by a head shot in a jpg file and a 40 word author’s bio.

PUBLICATIONS PERMIT:

#40026716

FOR PERMISSION AND REPRINT REQUESTS

Heather Hutchings - hhutchings@greaterkwchamber.com

SPONSOR PROFILE

The Right Structure at the Right Time

PRINTED IN CANADA BY:

PUBLICATION OF:

Sabrina Fitzgerald

Art Sinclair AWARDS

EVENTS

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MEMBER NOTABLES

Achieving Success Chamber Members SPONSORSHIP

Chamber Sponsors

POSTMASTER ADDRESS CHANGES: C/O

ADVOCATE - PUBLICATIONS OFFICE 80 QUEEN STREET NORTH, PO BOX 2367 KITCHENER, ONTARIO N2H 6L4 The Advocate is a bi-monthly membership benefit publication of the Greater Kitchener Waterloo Chamber of Commerce.

Advertising content and the views expressed herein are those of the contributors and do not constitute endorsement by the Chamber.

The Advocate follows the Canadian Code of Advertising Standards (1990), copies are available through the Publisher. The Chamber cannot be held responsible for any errors or omissions that may occur and has the right to edit material submitted. The Chamber will not accept advertising with competitor comparison claims and has the right to refuse advertising that is deemed to be false, misleading, or inappropriate.

advocate MAY | JUNE 2012

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message from the chair

The Importance of a Viable Manufacturing Sector

BY BRIAN BENNETT This edition of the Advocate focuses on collaboration and innovation with our postsecondary educational institutions, as well as our own Chamber Business of the Year recipient Desire2Learn. John Baker, CEO, outlines new and innovative transformational ways to enhance talent management across all sectors of the global workforce.

Manufacturing is definitely on the upswing with 25% of manufactures increasing production and 7.9% increasing research and development (innovation). However they remain below prerecession levels, therefore we need to review where and who we do business with.

We can't lose sight of the fact that 30% of Waterloo Region's GDP continues to be generated from the manufacturing sector.

Unfortunately Ontario manufacturing has experienced real challenges over the last decade, with 500,000 jobs lost due to the unprecedented appreciation in the Canadian Dollar and the 2008 recession which saw demand plummet. Canadian manufacturing has been enjoying a rebound since the downturn, however there has been a disconnect between output and job gains as employers remain cautious around adding new employees.

The U.S. has been our largest trading partner, however their economy remains sluggish and they are looking to establish new free trade agreements with other nations which could create more competition for Canadian businesses. As Bank of Canada Governor Mark Carney told a recent Chamber audience, we need to develop relationships with new growing markets to reduce our dependency on the United States. Asia and India are emerging economies that warrant further attention, and this is where the expertise of our local Canada's Technology Triangle can be of invaluable assistance as they focus on direct foreign investment.

The Federal Government is contributing by negotiating new free trade agreements with several countries around the world including the European Union.

Locally, our manufacturers are supported by the Waterloo Region Manufacturing Innovation Network (MIN), a free online network promoting awareness, excellence and innovation. MIN is coming off their first successful manufacturing summit which explored the challenges and opportunities in Ontario's manufacturing sector with keynote speaker Finance Minister Jim Flaherty.

Globally, the Manufacturing Leadership Council was established to provide education and skills development to meet future workforce requirements, advocate and promote the importance of manufacturing to prosperity and innovation including the opportunities and impediments facing manufactures, and create a manufacturing friendly environment with reforms around taxation, regulatory policy, and energy policy. Ontario continues to face a shortage of skilled workers, and locally Conestoga College is attempting to fill that void through enhanced training and apprenticeship programs.

Investing in talent is essential, but in order to be more competitive manufactures must also invest in machinery, equipment and technology to improve productivity and compete with other more favourable North American jurisdictions.

Other factors contributing to a strong domestic manufacturing economy include maintaining consistently high quality products which have faced some challenges overseas, timely delivery, and the ever increasing transatlantic shipping costs due to an uncertain energy market.

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Ottawa has also enhanced competitiveness by lowering the corporate income tax rate to 15%, with Ontario eliminating the capital tax, and with the Provincial corporate tax rate at 11.5%, we are competitive to other jurisdictions.

Stimulating manufacturing increases provincial tax revenue, investment in capital and talent, provides returns on our investment in education, and enhances Ontario's global success A diversified economy provides us with broad based innovation and growth appealing to a wide range of talent and skill sets, enhancing our community.

ABOUT THE AUTHOR

Brian Bennett CHAIR, BOARD OF DIRECTORS Brian Bennett is a Financial Services Executive and the owner of BME Consulting, a financial consulting services firm.

message from the president

Waterloo Region Economic Recovery is Moving Forward

BY IAN MCLEAN The recent federal and Ontario budgets both tabled at the end of March illustrate that fiscal restraint and rigid controls on government spending are dominating the agendas at Queen’s Park and Parliament Hill. This culture will continue for the short and medium terms as the public debt and deficits accumulated during the recent recession will, if not addressed immediately, limit future economic growth opportunities.

Despite controls on program expenditures, public investments are continuing into the Waterloo Region economy. Private investors, whether they are personal or business, seek a return on their money and in this sense governments are no different. Political officials want public funds to create jobs, attract private sector investment, and grow economic activity. Recent investments by Ontario and Ottawa indicate again that this community provides an excellent return for the dollars spent.

In the postsecondary sector, the University of Waterloo is part of a $210 million university-business collaborative with six other institutions and IBM in computer research. This initiative, announced on April 10, 2012, is funded by $20 million from the federal government, $15 million from Ontario, and up to $175 million from the aforementioned IT corporation.

The partnership will launch the IBM Canada Research and Development Centre, a network that will use state-of-the –art computer infrastructure to drive new discoveries and bring them to market. The centre will utilize cloud computing, a system where data is stored remotely for users to access and provides the capability for storing vast quantities of information.

Partnerships between universities and the business sector have been a critical factor in the evolution and success of our local economy, and the IBM project will be important for further expanding our research and innovation capacity.

As MP Harold Albrecht notes in his article, joint federal and provincial investments into Conestoga College have allowed President John Tibbits and his faculty to better serve the needs of the local business sector. The 50 percent increase in capacity now positions Waterloo Region companies across all sectors to capitalize on emerging opportunities in both domestic and global markets.

As the economy expands and population increases across Waterloo Region, the demands for infrastructure grow accordingly. Along with the local rapid transit system, the new Highway 7 connecting Kitchener and Guelph is again emerging as a priority project.

An environmental assessment was completed in 2007 on a proposed new four lane route connecting Highway 86 with the Hanlon Expressway. Five years ago, the provincial government made it clear that both Waterloo Region and Guelph/Wellington County had waited far too long for construction to commence and action was urgently required. Businesses and taxpayers anticipated immediate activity.

By April of 2011, Ministry of Transportation staff was warning municipal councils that construction, at the earliest, might commence in 2015. A lack of available provincial funding resulting from the prolonged economic recession has been frequently cited as the reason for the project not moving forward.

The importance of investing in these infrastructure projects is critical to growing our local economy as well as the broader provincial economy. The cost of not proceeding is far greater than delaying the projects again. Waterloo Region and Guelph/Wellington have been widely recognized as the drivers of future jobs and investment. Both municipalities possess a highly skilled workforce and global - leading postsecondary research institutions. Further government investments to ensure this growth continues are vital.

While the province has serious fiscal issues to address, making strategic investments is important for being prepared for the future. Four decades of waiting on a new highway is long enough.

ABOUT THE AUTHOR

Ian McLean Ian McLean is President and CEO of the Greater Kitchener Waterloo Chamber of Commerce.

advocate MAY | JUNE 2012

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awards nominations

A SPEC CIAL THA ANK YOU U

to the F OL LO W I N G 12 5 T H S P ON S OR S : keystone sponsors

benchmark sponsors

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foundation sponsors

small business

t Diane Wolfenden, InvestmenU Advisor, RBC DominiPO Securities t Grand RivFS Personnel t WilliamsburH Homes

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advocacy

Continuing Postsecondary – Business Collaboration is Critical for Future Success

BY ART SINCLAIR The relationship between Waterloo Region businesses and local postsecondary institutions has been extensively documented on a national and international level. The collaboration that has evolved among these sectors is a major reason for attracting talent and investment, creating new opportunities, and on-going economic prosperity.

A September 14, 2011 article in The Globe and Mail noted that when it comes to using educational systems as an economic development tool, Canadian cities and regions lag behind Waterloo. To turn things around, author Nick Rockel states, our neighbours across the nation have to realize that quality higher education provides a massive competitive advantage.

James Milway, Executive Director of the Institute for Competitiveness and Prosperity based in Toronto, noted that Ontario could elevate our economic performance if business leaders valued education on a relatively higher level. Also, civic officials must realize that their local universities and colleges are great economic assets and develop appropriate partnerships with them – a concept that has been prominent within the Waterloo Region economic environment for decades.

As an example of the unique business-postsecondary relationship in Waterloo Region, the Globe article notes the three local institutions have representatives on the board of Canada’s Technology Triangle Inc. (CTT). John Jung, CEO of CTT notes that schools are intimately involved in and integral to the process of making the community grow and succeed.

An asset of increasing importance to the business sector’s evolving and productive partnership with postsecondary education is the University of Waterloo Health Sciences Campus at King and Victoria Streets in downtown Kitchener. The campus, composed of the DeGroote School of Medicine and the UW School of Pharmacy, will assist greatly in addressing the many health care challenges that our growing region will manage over the next twenty years as the population increases by 50 percent.

Apart from state-of-the-art teaching facilities, medical research conducted at these schools will initiate sustained and beneficial economic growth. The School of Pharmacy is the first new institution established across Canada in twenty years, offering a curriculum that is one of the most innovative in North America.

Over 900 employers have participated in the co-op program that

provide students a wide range of options in practice experiences including community pharmacy, hospital pharmacy, pharmaceutical industry research, long-term care and government.

In his article this month, Canadian Chamber of Commerce President Perrin Beatty outlines the evolution and rising importance of intellectual property rights in the growth of the national economy. Last year, the CCC released a report Innovation for a Better Tomorrow: Closing Canada’s Intellectual Property Gap in the Pharmaceutical Sector. The report notes that while many key innovations and investments in pharmaceutical research and development are being done in this industry, greater protection of intellectual property and improvements to regulations and legislation will have a tremendous impact on future activities.

Across Canada research is not only helping residents live better and receive superior treatment when sick, it is also making an important contribution to national economic growth. Researchbased pharmaceutical companies invest billions into critical activities and employ thousands of people in highly-skilled and well paying jobs.

As the CCC notes, knowledge-based industries such as pharmaceutical are recognized as engines of the new economy and will make Canada a leader in health innovation. The potential for growth is huge.

With continuing collaboration among the business and local postsecondary sectors, the prospects for Waterloo Region to build global- leading drug research capacity is highly promising. With our achievements in IT as the foundation, we are effectively positioned for future investment and job creation.

ABOUT THE AUTHOR

Art Sinclair Art Sinclair is the Vice President Policy and Advocacy for the Greater Kitchener Waterloo Chamber of Commerce.

advocate MAY | JUNE 2012

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awards

Business Excellence Awards Winners

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AWARD CATEGORY | COMPANY | ACCEPTING AWARD | AWARD PRESENTER 1) 2) 3) 4) 5) 6) 7) 8) 9) 10) 11) 12)

YOUNG ENTREPRENEUR OF THE YEAR AWARD | SUSTAINABLE WATERLOO REGION | MIKE MORRICE | RON MCNAUGHTON FROM CONRAD BUSINESS, ENTREPRENEURSHIP AND TECHNOLOGY CENTRE INTEGRATION AWARD | CITY OF KITCHENER| KELLY GALLOWAY | MARTIN KIHLE FROM LIBRO FINANCIAL VOLUNTEER OF THE YEAR AWARD | JASON KIPFER | DR. WILLIAM BANKS FROM LAURIER SCHOOL OF BUSINESS & ECONOMICS NONPROFIT/CHARITABLE AWARD | HOSPICE OF WATERLOO REGION | IRENA BORG | NEIL HENDERSON FROM BORDEN LADNER GERVAIS LLP PROFESSIONAL DEVELOPMENT &WORKPLACE TRAINING AWARD |STANTEC | DAVE FLYNN | DR. JOHN TIBBITS FROM CONESTOGA COLLEGE ENVIRONMENT & SUSTAINABILITY AWARD | AET GROUP | LARRY FREIBURGER | MURRAY COSTELLO FROM UNION GAS: A SPECTRA ENERGY COMPANY HOSPITALITY/TOURISM AWARD | CHICOPEE | LORI MCCRAE | MARY D'ALTON FROM WATERLOO INN CONFERENCE HOTEL HEALTHY WORKPLACE AWARD | RAYTHEON CANADA LIMITED | SANDRA MUNRO | MALCOLM MAXWELL FROM GRAND RIVER HOSPITAL INNOVATION AWARD | QUARRY INTEGRATED COMMUNITCATIONS | ALAN QUARRY (L) | DAVE JAWORSKY FROM RESEARCH IN MOTION BUSINESS OF THE YEAR (20 EMPLOYEES AND UNDER) | TRIBEHR | BEN BACH (ACCEPTING FOR JOSEPH FUNG | JOHN COLANGELI FROM LUTHERWOOD BUSINESS OF THE YEAR (OVER 20 EMPLOYEES) |(DESIRE2LEARN) | JOHN BAKER | TIM JACKSON FROM UNIVERSITY OF WATERLOO MICHAEL R FOLLETT COMMUNITY LEADER OF THE YEAR AWARD | TIM JACKSON | DON BISCH FROM EQUITABLE LIFE INSURANCE COMPANY OF CANADA

*ROSS HULL, METEOROLOGIST CTV, APPEARS ON THE FAR LEFT OF EACH PHOTO

Photography by Adamski Photography

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awards

Business Excellence Awards Guests

Photography by Adamski Photography advocate MAY | JUNE 2012

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networking

Spring networking 1

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1) LEO TOBI, GREG SCHOTT, AND DAVID MACLELLAN * 2) CONNIE KOEBEL AND KARLI IMHOFF FROM WLU AT AML/ROGERS CHAMBER CONNECTIONS * 3) JEN DOL, NORTHERN LIGHTS CANADA, AND BRADLEY SOUTHAM, LINUS CREATIVE SERVICES *

*Photography by Adamski Photography

4) CHAMBER CHAIR BRIAN BENNETT ADDRESSING CROWD AT PUBLICATION EVENT * 5) BRIAN BENNETT, BANK OF CANADA GOV. MARK CARNEY, AND PAUL ROONEY, CEO MANULIFE **

**Photography by Lisa Malleck Photography

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networking

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6) PACKED CROWD AT 125TH ANNIVERSARY PUBLICATION NETWORKING EVENT * 7) BANK OF CANADA GOVERNOR MARK CARNEY AT HIS 125TH ANNIVERSARY POINT OF VIEW LUNCHEON ** 8) JILL ZAPPITELLI, LINDA DANCEY, AND ROB RICHMOND NETWORKING AT CHAMBER CONNECTIONS *

9) KW HUMANE SOCIETY EXECUTIVE DIRECTOR JACK KINCH AND ADAM SMITH, MY IT GUY * 10) GIHAN SALGADO, LINDA OCKWELL-JENNER, DAVE OCKWELL-JENNER, AND CHRIS MEIDELL * 11) HONOURABLE FRANK MCKENNA SPEAKING AT 125TH ANNIVERSARY POINT OF VIEW LUNCHEON *

*Photography by Adamski Photography

**Photography by Lisa Malleck Photography

LOOK TO US FOR ALL OF YOUR

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TToo advertise or partne partner er with the Waterloo Waterloo Region Regionn Record, Record, please call 519-8 519-894-2250.

894-2250. advocate MAY | JUNE 2012

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new members

February 1, 2012 to March 31, 2012 Abin Network Solutions

BusiLINKS

CrossFit Kitchener

Computer Consultant Atul Parekh 60 Skipton Crescent, Cambridge, ON N3C 4N9 Email: info@abinnetsol.ca / Web: http://www.abinnetsol.ca Phone: (519) 279-1602 / Fax: (226) 566-6776

Advertising - Directory & Guide Wanda Slaunwhite, CEO 72 St. Leger Street, Unit 230, Kitchener, ON N2H 6R4 Email: info@busilinks.ca / Web: http://www.busilinks.ca Phone: (519) 496-5461 / Fax: (519) 578-3646

Health, Fitness & Exercise Service Joanne Mittelholtz, Owner/Trainer 543 Mill Street, Unit 6, Kitchener, ON N2G 2Y5 Email: joanne@crossfitkitchener.com Web: http://www.crossfitkitchener.com Phone: (519) 208-7240

Butterfield Fulcrum

Dettmer Tire & Auto Centre

Financial Services Products Steve Slessor, Managing Director, North America 725 Bridge Street West, Suite 101, Waterloo, ON N2V 2H1 Email: sslessor@bfgl.com / Web: http://www.bfgl.com Phone: (519) 748-6028 / Fax: (519) 748-0597

Tire Dealers, Distributors & Manufacturers Mr. Dave Wingert, Owner 660 Belmont Avenue West, Kitchener, ON N2M 1N6 Email: sales@dettmertire.ca Web: http://www.dettmertire.ca Phone: (519) 743-1431 / Fax: (519) 743-4619

Capacity Waterloo Region

Direct Office Equipment Inc.

Charitable & Community Organizations Cathy Brothers, Executive Director in Residence Accelerator Centre, 295 Hagey Boulevard Waterloo, ON N2L 6R5 Email: info@capacitywr.ca / Web: http://www.capacitywr.ca Phone: (519) 513-2606 / Fax: (519) 513-2421

Photocopiers & Supplies Ms. Louise St Jean, Office Manager 38 Francis Street, Kitchener, ON N2G 2A2 Email: directoe@bellnet.ca / Web: http://www.directoe.com Phone: (519) 585-7772 / Fax: (519) 585-3218

Allstream Telecommunications Olga Kudjerski, Field Marketing Manager - Central Region 200 Wellington Street West, Toronto, ON M5V 3G2 Email: olga.kudjerski@mtsallstream.com Web: http://www.allstream.com Phone: (855) 299-7050

Animazing Pet Bath Pet Grooming Josie Graham, President 700 Strasburg Road, Unit 26, Kitchener, ON N2E 2M2 Email: jgraham@innovationcentre.ca Phone: (519) 514-0120

BES Art Artists - Fine Arts Barbara Shaw, Artist 601 Duke Street, Unit 205, Cambridge, ON N3H 3T4 Phone: (519) 650-9355

BioTalent Canada Charitable & Community Organizations Clara Wicke, Marketing & Communications Manager 85 Albert Street, Unit 1100, Ottawa, ON K1P 6A4 Email: claraw@biotalent.ca / Web: http://www.biotalent.ca Phone: (613) 235-1402 / Fax: 1 (613) 233-7541

Brenda Turnour ~ Creative Arts Artists - Fine Arts Brenda Turnour 4 Lansdowne Road South, Cambridge, ON N1S 2T3 Email: brenda.turnour@live.ca Web: http://www.brendaturnour.com Phone: (226) 989-8332

Brody Enterprises Inc. Home Decor Services Dennis McMahon, President 27 Evening Star Lane, Conestogo, ON N0B 1N0 Email: dennis@brodyenterprises.com Web:http://www.brodyenterprises.com Phone: (519) 664-1453 / Fax: (519) 664-1549

Doyle Investments Corp

Cityhound Inc. Internet Products & Service Brad Reibling, Vice President 26 Monmore Road, London, ON N6G 2W6 Email: brad@cityhound.com Web: http://www.cityhound.com Phone: (519) 274-9404

Clair Hills Retirement Community Retirement Communities & Homes Denise Winger, Executive Director 530 Columbia Street West Waterloo, ON N2T 2N3 Email: info@clairhillsretirement.com Web: http://www.clairhillsretirement.com Phone: (519) 880-8444

Condotta, Merrett & Co. Insurance Brokers Inc. Insurance Agents & Brokers Greg Lundy, Broker 490 Dutton Drive, Unit C7, Waterloo, ON N2L 6H7 Email: info@condottamerrett.com Web: http://www.condottamerrett.com Phone: (519) 804-1948 / Fax: (519) 954-2244

BUILD YOUR BRAND WITH THE REACH OF THE CHAMBER WEBSITE

Website

Online Directory

eNewsletter

Call us at 519.576.5000 to find the best online outlet for you 12

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Real Estate Management Judy Staats, General Manager 1254 Union Street, Kitchener, ON N2H 6K4 Email: jstaats@doyleproperties.ca Web: http://www.doyleproperties.ca Phone: (519) 500-8248 / Fax: (519) 632-9664

Dundee Pottery & Stained Glass Artists - Fine Arts Rosemary Arthurs, Proprietor 181 Front Street, New Dundee, ON N0B 2E0 Email: info@dundeepottery.ca Web: http://www.dundeepottery.ca Phone: (519) 696-2484

Embassy Grill and Bar Restaurants Dorothy Litwin, General Manager 56 King Street North, Unit 1, Waterloo, ON N2J 2X1 Email: embassyonking@gmail.com Web: http://www.embassywaterloo.com Phone: (519) 954-8111

new members

Engaging Business Solutions Inc.

Generations Financial Solutions

Javelin Technologies

Human Resource Consultants Margaret Sullivan Williams, Owner/HR Business Partner 56 Braun Street, Kitchener, ON N2H 3R4 Email: msullwill@gmail.com Phone: (519) 743-6127 / Fax: (519) 743-6512

Financial Planning Consultants Anne Huntley, Owner 570 University Avenue East, Unit 1, Waterloo, ON N2K 4P2 Email: anne@generationsfinancialsolutions.com Web: http://www.generationsfinancialsolutions.com Phone: (519) 888-3300 / Fax: (519) 888-9203

Computer Software Jas Dhaliwal, Account Manager 214 Essex Point Drive, Cambridge, ON N1T 2A2 Email: john.brown@javelin-tech.com Web: http://www.javelin-tech.com Phone: (905) 815-1906 / Fax: (905) 815-1907

Eva McCauley - Glen Lamond Studio Artists - Fine Arts Eva McCauley, Owner 1 Union Street, Roxton Furniture Building Elmira, ON N3B 3J9 Email: evamccauley@sympatico.ca Web: http://www.evamccauley.com Phone: (519) 848-5970

Jeff MacIntyre

Granite Guys Home Improvements & Renovations Atul Parekh 60 Skipton Crescent, Cambridge, ON N3C 4N9 Email: atul@abinnetsol.ca Phone: (519) 279-1602

Jennifer Depencier's Art

Exhaust Tech

High Rise Studio

Restaurant Equipment-Service & Repair Erika Pinkerton, Co-Owner/Office Manager 94 Hawkswood Drive, Kitchener, ON N2K 4J5 Email: pinkertons@rogers.com Web: http://www.exhausttech.com Phone: (519) 742-2612 / Fax: (519) 742-2612

Video Production Matthew Ninaber, Director/Owner 1857 Sawmill Road, Unit 202, Conestogo, ON N0B 1N0 Email: matt@highrisestudio.ca Web: http://www.highrisestudio.ca Phone: (519) 206-4444

Fast Forward div. of 1411347 Ontario Limited

Hillcrest House Bed and Breakfast

Commodity Brokers L. Alexander Ruge, CEO 33 Queen Street South, Unit M1, Kitchener, ON N2G 1V8 Email: fastforwardglobal@gmail.com Phone: (519) 212-8867

Bed & Breakfast Wendy Schuster, Co-owner 73 George Street, Waterloo, ON N2J 1K8 Email: info@hillcresthouse.ca Web: http://www.hillcresthouse.ca Phone: (519) 744-3534

Formulating Change Inc. Fundraising Organizations David Beaton, President and CEO 151 Charles Street West, Unit 180, Kitchener, ON N2G 1H6 Email: info@formulatingchange.com Web: http://www.changeitcanada.com Phone: (519) 804-2235

gcGroup Inc "Real Estate Investing" Real Estate Investments David George, President 55 Northfield Drive East, Unit 264, Waterloo, ON N2K 3T6 Email: gcgroupinc@rogers.com Web: http://www.gcgroupinc.ca Phone: (226) 339-5215 / Fax: (519) 342-1688

Home Instead Senior Care Home Health Care Services Kathleen Needles, Manager 570 University Avenue East, Unit 5, Waterloo, ON N2K 4P2 Email: kathleen.needles@homeinstead.com Web: http://www.homeinstead.com/3007 Phone: (519) 571-1665 / Fax: (519) 571-7454

Huether Hotel Restaurants David Adlys, Owner 59 King Street North, Waterloo, ON N2J 2X2 Email: info@huetherhotel.com Web: http://www.huetherhotel.com Phone: (519) 886-3350 / Fax: (519) 886-8767

Honorary Members c/o So There Business Solutions/Winexpert Kitchener South 601 Doon Village Road, Kitchener, ON N2P 1T6 Email: jmacintyre@netflash.net Phone: (519) 893-1555 Artists - Fine Arts Jennifer Depencier 43 Bergey Street, Cambridge, ON N3C 1P7 Email: jensart@live.ca Web: http://www.jenniferdepencier.com Phone: (519) 249-1147

Jim Doyle Consulting Consultants Jim Doyle, President 175 Queen Street North, Unit 210, Kitchener, ON N2H 2H9 Email: doyle-james@msn.com Phone: (920) 889-1068

JP Quality Care Construction Inc. Construction James Palmerton, President 178 Peach Blossom Crescent, Kitchener, ON N2E 3Z6 Email: jpqualitycareconstruction@rogers.com Phone: (519) 635-6391

Katharine Senyck - Accounting Services Accounting & Bookkeeping Services Katharine Senyck, Owner 163 MacGregor Crescent, Unit 4, Waterloo, ON N2J 3X2 Email: ksenyck@sympatico.ca Phone: (519) 747-0271

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feature

Benefits of Canada’s Economic Action Plan 2012 on Waterloo Region

BY HAROLD ALBRECHT, M.P. Canada’s Economic Action Plan 2012 was tabled in the House of Commons on March 29th. In it, Finance Minister Jim Flaherty charts a prudent course to jobs, growth, and long-term prosperity for Canadians.

By making these choices now, we are reinforcing the fundamental strengths that underpin our economy, to create growth, highquality jobs, preserve our cherished social programs, and allow businesses to prosper.

Taxes will remain at their lowest level in decades, while the budget will return to surplus. The federal bureaucracy will shrink, but transfers to the provinces for health care and education will grow.

Some stakeholders encouraged us to find new ways to spend more tax dollars. Instead we focussed on generating better results for our investments.

Canada’s Economic Action Plan 2012 forecasts a return to surplus budgets in 2015. This will be achieved by ending the temporary stimulus measures first outlined in 2009, rationalizing program delivery, and eliminating about 19,000 public service positions.

Across government, initiatives are underway to provide improved service at a lower cost: eliminating paper, consolidating programs, and to identify programs which no longer provide the value they may have in days long past.

When the global downturn hit, Canada was well-prepared. Our banking system was sound and our real estate prices were based on reality, so Canada was not required to invest scarce resources on the bailouts that plagued our trading partners. Our government had paid down more than $37 billion of debt, so we were able to support job-creating stimulus investments. While others scrambled to preserve their economies, Canada invested in assets that will pay dividends for years to come.

Locally, KW now hosts UW’s Quantum-Nano Centre, Communitech’s high-tech business incubator “the Hub,” and Conestoga College is better-prepared than ever to serve local business needs – thanks to an almost 50% increase in its capacity.

Municipalities renewed their high-priority roads, bridges and sewer systems and built new community centres with federal support. Our airport was improved. Waterloo Region is now better-prepared to seize every opportunity that emerges as the global recovery takes hold.

But our stimulus measures were only temporary. No family, business, or government can spend more than it takes in, year after year, without consequence. Sooner or later, lenders view profligate borrowers as “risky” and charge them a premium, creating a vicious circle.

The recent global crisis highlighted this danger: previously successful economies were dragged down under the weight of interest payments. And, many of us still remember the damage to our national fabric when Canada’s credit rating was previously jeopardized under previous governments. More recently, articles about the dangers facing us if Ontario’s budget is felt insufficient to meet its debt challenge have reminded us of the dangers inherent in postponing tough decisions.

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At the same time, we are taking this opportunity to make government more responsive to the needs of job-creating entrepreneurs. Budget 2012 commits to developing a One Project – One Review approach to major projects. It offers new opportunities for businesses to enhance their competitive position by leveraging expertise available in colleges and universities. Our commitment to opening new markets through free trade was restated. Employment Insurance will be modified to make premiums more predictable and stable, and to remove disincentives for claimants to pursue work.

We remain committed to health care and social programs, and our guarantee of funding increases demonstrates that. We understand that Canada’s long-term prosperity depends on healthy privatesector job creation, and we understand that excessive taxation and cumbersome regulations will destroy private sector jobs.

Budget 2012 is a prudent plan and a map to Canada’s bold future.

It is now up to Canada’s entrepreneurs, the true heroes of job creation, to seize that opportunity.

ABOUT THE AUTHOR

Harold Albrecht, M.P. Harold Albrecht has been Member of Parliament for Kitchener-Conestoga since 2006. Prior to his political career, he operated a local dental practice for 27 years.

feature

Immigrant Internship Program

BY LIL PREMSUKH

Shared opportunities... Shared rewards.

Waterloo Region’s future growth and prosperity depend on our ability to attract workers with the skills and experience needed to maintain and strengthen employers’ competitive advantage.

Internationally Trained Individuals can help close the skills shortage gap predicted for the near future and make valuable financial and cultural contributions to the Region.

The Immigrant Internship Program is a partnership between Conestoga College Institute of Technology and Advanced Learning and the Immigrant Partnership of Waterloo Region.

Employers are connected with job-ready, skilled, and professional immigrants to complete a paid internship of four months or longer in their profession or trade.

Whether it is a position that needs to be filled quickly or searching for a very specific set of skills, the Internship program can help you. Candidates are available across all disciplines.

Examples of typical internships include: • Project Engineer

Benefits of hiring an Intern include: • attraction of employees with the talents and skills required by your organization to remain competitive • pre-screened candidates according to position requirements at no cost to you • temporary employees with valuable skills to accommodate peak periods of activity, seasonal variations, maternity leaves or short-term projects needs • evaluation of candidates for permanent employment • bilingual/multi-lingual candidates • access to first-hand knowledge of global markets and cultures Interns live locally and are job ready and eligible to work in Canada, hold a post-secondary degree in their field of expertise and are looking to gain Canadian experience.

For more information or hire an intern, contact Lil Premsukh at (519) 748-5220 ext. 2387 or lpremsukh@conestogac.on.ca.

• Electrical Technician/Technologist • Technical Support • Bilingual Customer and Sale Support • Cost Clerk -Bookkeeper • Bookkeeper • Welder/Fitter • Technical Sales Representative • QA Data Analyst • Software QA Analyst/Engineer

ABOUT THE AUTHOR

Lil Premsukh Lil Premsukh is the Manager of Workforce Access Programs and Conestoga Career Centre that works to help people find meaningful employment. Lil has worked in career development at Conestoga College for nearly 10 years in a number of influential positions

advocate MAY | JUNE 2012

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cover story

Investing in Education

BY JOHN BAKER In an increasingly globalized and rapidly advancing world, education is one of our most important collective pursuits. It is the gateway to future success and the creation of new knowledge, the path to innovation, and the key to sustainable economic growth. In the old industrial economy, the focus was on investing in machines and equipment, but in today’s world, the focus is on investing in people. Preparing the next generation of learners to command their future endeavors is at the heart of our mission at Desire2Learn; to transform the way the world learns.

With over eight million users worldwide at over 650 different organizations, our innovative learning solutions are transforming education globally. We exist because we care about the future of education, and we strive to continually improve the quality of learning opportunities available to learners throughout their education journey, in careers, and beyond.

Just as we are committed to transforming education around the world, we value this as part of our corporate culture as well, dedicating resources to ensuring our employees are continually learning and growing as professionals. This commitment translates into continual skills development for our employees, rooted in a belief that if we are always learning, productivity and employee engagement will be positively impacted as well.

At Desire2Learn, we have developed extensive learning for onboarding and professional development using our own technology – Desire2Learn Learning Environment. All of our employees continue to learn, grow, and share with each other from their first day onward.

Using Desire2Learn ePortfolio, employees highlight points of interest and share important findings with others. Our new Google Chrome plug-in enables users to automatically post something they’ve discovered online, directly onto their ePortfolio. This is enabling us to be more intelligent about how we share and curate knowledge; using our technology to ensure that users are seeing the content that is most relevant to their work. Our mobile offerings assist with that as well, enabling direct posting of relevant videos or pictures to the ePortfolio. In addition to sharing, ePortfolio is a method for documenting employee growth and learning, facilitating ongoing performance discussions. Finally, our Desire2Learn Capture technology enables virtual learning with rich-media webcasts – we capture the best training and post it online for our employees to watch anytime, at their own pace – part of a broader strategy to maintain a sense of community and collective culture amongst all of our internationally-based employees.

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The way we utilize our own technologies is intrinsically connected to the culture of learning we have created at Desire2Learn.

Employees truly value the opportunity to collaborate and grow as a collective workforce. Everyone’s goals and competencies are mapped in the organization so there is the opportunity for dualladder job progression – in other words, you don’t have to go into management to move up within the company; you can move up within your own field of work.

Based on that commitment, we’re building out a comprehensive talent management framework, where we are looking at every role in the company, figuring out how that role can develop and evolve, and how we can keep every employee continually learning and growing, including professional development in the form of additional courses, programs, executive training, conferences, professional designations, and social learning opportunities.

We believe that improved education can ultimately lead to an improved society, and this idea is central to our founding, and why we do what we do each and every day. We are delivering an engaging, social, and personalized learning experience that values collaboration and creativity – an innovative approach to education that is changing how people learn. At the same time, this is exactly what we are doing internally as a company, striving to create an atmosphere where our employees can grow and learn as well.

There is no better way for our employees to deliver the best possible learning solutions to our clients than to actually engage in the learning process themselves – to become better at their jobs, more knowledgeable in their fields, and more passionate about education. In doing so, we are equipping our employees with the tools they need to achieve our mission: to transform teaching and learning around the world.

ABOUT THE AUTHOR

John Baker John Baker is CEO at Desire2Learm, founded in Waterloo Region during 1999. He lead the company through a period of rapid growth to 4 million learners. John graduated with an Honors B.A.Sc. in Systems Design Engineering, with First Class Honours and an option in Management Sciences from the University of Waterloo.

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Chamber’s 125th Jubilee

8:00am-4:30pm Location: Bingemans Embassy Room Tickets: $100 Pre-Registration is required.

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7:30am-9:00am Location: Waterloo Inn Conference Hotel Member: $15 + HST General Admission: : $20 + HST Pre-Registration is required.

Developing “people skills” is essential to improving our relationships with both coworkers and friends. This workshop is a simple approach to improving our people skills, the principles are useful for everyone.

5:00pm-7:00pm Location: Waterloo Region Museum Member: : $50 + HST General Admission: $65 + HST Come out to the Chamber’s 125th Jubilee and network with Past Chairs of the Chamber as we celebrate the conclusion of our 125th Anniversary celebrations.

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May 11, 2012 Manulife Chamber Academy Presents Picking Your Social Networks 8:00am-10:00am Location: Chamber of Commerce Office Member: $20 + HST General Admission: : $25 + HST Pre-Registration is required.

Discover which social networks are best for promoting your business so you can start attracting clients. Understanding what is best for your business is the first and most important step in deciding to leverage the power of social media.

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May 15, 2012 Research In Motion Chamber Young Professionals Present Managing Your Online Presence 5:00pm-7:00pm Location: Centre in the Square Member: $10 General Admission: $15 Pre-Registration is required.

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May 24, 2012 WALTERFEDY Networking Breakfast Series Presents “Emotional Intelligence: The Untapped Aptitude” 7:15am-9:00am Location: Holiday Inn Kitchener Waterloo Member: Complimentary General Admission: $15 + HST Join Laura Allen for an introduction to Emotional Intelligence - from its origins and how it differs from other measurements of aptitude, to ways that it can improve performance in a business setting both individually and organizationally.

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May 30, 2012 Heffner Lexus Women’s Leadership Presents LinkedIn: Personal vs.

Professional Networking 11:30am-1:00pm Location: TBD Member: $30 + HST General Admission: $40 + HST LinkedIn is a powerful networking tool for businesses, their employees and job seekers alike. Whether you are already a user or not, there are many questions you may be asking yourself, including "Who do I invite?" and "Who do I accept as a connection?". Come out and get a variety of perspectives on how best to utilize the service from a panel representing small businesses, non-profits, and business development professionals.

June 12, 2012 “Survive and Thrive!” with Greg Viner: Dominating Your Online Market

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feature

Grand River Hospital: A Thriving Health Centre for a Growing Community

BY MARK KARJALUOTO As the Waterloo Region continues to draw world-wide investment and talent, a strong health system is vital in maintaining economic growth.

Grand River Hospital (GRH) is stepping up to meet the need, with a wide range of specialized health programs covering all stages of patients’ lives and recent expansions to support growing health needs.

GRH is the Waterloo Region’s largest acute care hospital. Staff and physicians treat patients in 14 specialized programs and services.

GRH is the regional provider of cancer services, stroke services, lifesustaining kidney dialysis care, as well as a range of mental health and addictions services. The hospital also provides a range of services including emergency and critical care, medical imaging, surgery, rehabilitation and many others. GRH is a key contributor to family health, with 4,300 babies born at the hospital every year and by providing a host of children’s programs.

GRH’s two main sites have grown in leaps and bounds following nearly five years of construction and $76 million in investment.

Funding from the Government of Ontario, the Region of Waterloo and generous donors through the Grand River Hospital Foundation has supported a range of projects at the Freeport and KW sites.

“Anyone who’s been involved in a renovation project can appreciate how challenging it’s been to expand our hospital while continuing to meet patient needs,” explains Malcolm Maxwell, Grand River’s president and CEO. “But all the hard work over the past years is paying off, with larger and improved facilities to benefit patients and care providers.”

Some of the projects that have come into place since 2010 include the following: • Adding 30 new in-patient medicine beds at the KW Site to help move admitted patients from the emergency department faster, and consequently ease emergency wait times; • Vastly-expanded acute mental health facilities at the KW Site, providing more beds and a more welcoming care environment for adults, adolescents and children dealing with an acute mental illness; • A new 50-bed specialized mental health program at the Freeport Site, providing longer-term care for people with a serious and persistent mental illness. This expansion has brought services to KW which were formerly provided at Regional Mental Health Care in London; and

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• Improvements to operating rooms, minor surgery and procedures spaces.

“Renovations like these take a long time to come to fruition. But our patients and staff have told us how the more welcome environments, such as those in our mental health program, make such a difference for care,” adds Jenny Rajaballey, the hospital’s vice president responsible for mental health, diagnostics and redevelopment.

A key project that shows the difference the renovations have made is the KW Site’s new intensive care unit. The 15,000 square foot unit is nearly four times larger than the one it replaced, and offers the latest improvements to care for critically-ill patients. It features: • 20 beds, up from 14 beds provided in the previous ICU; • Private care spaces with more room for patients, families and care providers and increased infection control standards; • Large windows for every patient room offering plenty of natural light; • Ceiling-mounted articulating arms for instruments, monitors and supplies, reducing equipment on the floor and improving infection control practices; • Glass partitions in the rooms allowing for improved monitoring of patients; and • Five new isolation suites.

Hospital staff and physicians took steps in the design of the new ICU to make sure family and friends would be key participants in patient care and recovery. Two new quiet rooms as well as washrooms, a shower and sleeper chairs allow family and friends to be close to their loved one at all times.

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“All the staff and physicians who worked in the cramped quarters of our old intensive care unit are very happy to have this new unit available to us. A better facility can make major improvements for patient care and infection control. We know our staff do an excellent job; this unit allows them to go that much further for patients,” says Dr. Paul Hosek, medical director for the intensive care unit.

at www.grhf.org. The hospital is working to have the new equipment operational by 2013.

GRH is also planning for the overall future of its two sites through the development of a facilities master plan. While the Freeport Site has room to expand, the KW Site is land-locked. Further planning will help clarify where future service expansions can be located, and the infrastructure required to meet those needs.

“Our KW Site is well placed to continue providing emergency services, our very busy childbirth and children’s programs, surgery, cancer care, kidney care and acute mental health. Freeport has been well placed as a facility for longer-term care, rehabilitation, and now on-going mental health services. We’ve also been able to expand Freeport to provide dialysis treatment to ease pressure at the KW Site, and the Waterloo Wellington Breast Centre to provide highlevel imaging services for women,” adds Ms. Rajaballey.

While the hospital has made great strides in bricks and mortar as well as program development, GRH is now focusing on equipment needs over the next five years as part of its capital plan. The hospital needs nearly $50 million in new instruments and equipment.

Examples on the capital list include patient infusion pumps to provide medication and pain relief, dialysis machines to provide lifesustaining treatment for patients living with kidney failure, and improved diagnostic equipment.

A key project for which the Grand River Hospital Foundation is now raising funds is new interventional radiology equipment.

Interventional radiology uses image guidance and minimally-invasive catheters and probes to diagnose and treat a range of illnesses. It offers a less-intrusive alternative to open surgery. The benefits for patients are significant.

"State-of-the-art interventional radiology equipment will enable us to provide a range of treatment not currently available with our existing equipment. Given the impact of our growing cancer program and other specialized programs at GRH, this need is quite urgent," explains Dr. Darren Knibutat, an interventional radiologist at GRH. "We have the knowledge and skills within our medical staff to provide a range of new care options. Improved equipment will help us meet those care needs."

As the region grows and develops, GRH is dedicated to being a part of patients’ lives while developing stronger links to the community.

“We want to work closely with business, community and health partners to make sure the services we provide are responsive to the needs of our residents,” explains Mr. Maxwell.

ABOUT THE AUTHOR

Mark Karjaluoto Mark Karjaluoto is the Director of Communications at Grand River Hospital, Waterloo Region's largest acute care facility.

The Grand River Hospital Foundation is raising $1.5 million for this equipment. More information is available on the foundation’s website advocate MAY | JUNE 2012

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feature

Putting Intellectual Property Rights Issues on the Map

BY PERRIN BEATTY In early 2008, the Canadian Chamber of Commerce created the Canadian Intellectual Property Council (CIPC). The CIPC enables Canadian-based businesses to better position their specific issues and concerns to effectively lobby politicians and key policy makers. The goal of the CIPC is to promote an improved environment in Canada for businesses engaged in innovation and companies that value their intellectual property (IP) rights. Recently, the focus of the CIPC has been to get updated copyright legislation passed, strengthen our patents and trade-marks system and get measures implemented that will make the importation of unsafe counterfeit goods more difficult.

Members of this coalition meet on a regular basis to discuss intellectual property rights policies in Canada and how we can move the yardsticks within government to better protect IP rights. Greater effort is being made to grow awareness of IP issues, both with the public and key policy makers. We’ve done a lot in the two plus years that the CIPC has been active. We’ve sent multiple letters to MPs, appeared before Parliamentary Committees, made submissions to the government and met individually with approximately 40 MPs of all stripes to discuss different IP issues that concern our members. The CIPC has also published a comprehensive report on IP issues in Canada and successfully lobbied the government to get IP noted in multiple Throne Speeches.

that IP theft robs G20 governments of more than €100 billion in tax revenues, and puts 2.5 million legitimate jobs at risk each year.

The collateral damage to innovation, international trade and business investment is steep, as is the impact on consumers, societies at large and even government spending. Consumers waste money on poorquality products that are unregulated and often unsafe, according to the report. Furthermore, governments are forced to spend more: the harm caused by hazardous products drives up health care costs, and criminal involvement in counterfeiting increases crime prevention costs.

The scale and gravity of IP theft – whether online or in the physical world – should make it no less a crime than the theft of physical property.

By better protecting and defining IP rights, we will develop a marketplace that rewards and protects investments in innovations, creations and goodwill, fostering new and innovative business models, stronger economic growth, job creation and prosperity. Better laws and enforcement against counterfeiting and piracy will not only protect consumers from shoddy and often dangerous products such as knock-off electrical cords, batteries and medicine, but will also make it more difficult for criminal syndicates to profit from their sale. In modern, developed nations like Canada, where services and innovation have become key economic drivers, this has never been more crucial.

Leading economies around the world have made IP protection a priority. In Japan, an IP Strategy Council has been organized. This issue was deemed so important that the Japanese Prime Minister leads the organization, with the CEOs of leading companies such as Canon and Mitsubishi on-board. In France, an anti-piracy commission designed to curtail internet piracy is overseen by French President Nicolas Sarkozy, with the Minister of the Economy and Minister of Culture sharing lead responsibilities.

From main street to Parliament Hill, when businesses work together, it’s a powerful message that MPs hear and respond to.

Over the last decade, the proliferation of IP theft has helped to weaken the global economy. In particular, digital piracy has increased dramatically as Internet access has expanded. Research conducted by the International Chamber of Commerce (ICC) finds that legitimate businesses worldwide lose more than €600 billion in sales annually. In another report by UK-based Frontier Economics, researchers found

Honourbable Perrin Beatty is the President and Chief Executive Officer for the Canadian Chamber of Commerce, Canada’s largest national business association.

ABOUT THE AUTHOR

Perrin Beatty

advocate MAY | JUNE 2012

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sponsor profile

The Right Structure at the Right Time

BY SABRINA FITZGERALD There are many benefits to private business owners resulting from having a holding company (Holdco) in their corporate structure.

However, it is vital that placement of the holding company, and the ownership of shares in operating companies (Opco) is done strategically in the corporate structure to maximize all of the tax planning and wealth enhancement and protection benefits possible from having a Holdco.

In our experience, the traditional Holdco owning shares of Opco is often not the optimal choice of structure for businesses where there is or will be a future possibility to sell Opco shares as a Qualifying Small Business Corporation (QSBC).

Put another way, whenever we see corporate structures where a holding company owns the common shares of a potential QSBC, we believe there are often substantial opportunities for better structuring, with more benefit to the business owner. In this context it is vital to remember that only individuals have a $750,000 personal capital gains exemption (CGE); there is no such exemption available for companies.

One of the tax benefits of incorporation is the significant tax deferral provided by the low corporate tax rates, say 16% applied to active income earned by Opco. As compared to a top personal tax rate of say 46%, for a company earning $500,000 of net income per year the tax deferral available annually is $147,500. This is a staggering tax difference savings!

But to take maximum advantage of this deferral, funds have to be retained at the corporate level. If these funds are retained in the Opco, one creates a risk of putting the company offside the QSBC test. The accumulation of excess funds is not typically considered to be a business asset for purposes of the QSBC test, and therefore will disqualify the Opco as a QSBC. The implication of this would be that the shares would not qualify for personal $750,000 CGE on sale (or death). Avoiding this outcome is one of the primary reasons to

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have a holding company, so that Opco can be purified by means of ongoing dividends to Holdco.

Where Holdco owns the shares of Opco, and receives the dividend, while the QSBC purification of Opco might theoretically be accomplished, in reality the effort would be ineffective for CGE purposes. This is because Holdco owns the Opco shares and is not eligible for CGE. Only individuals are eligible for CGE. Thus, the existence of Holdco as the parent of Opco in the typical “in-line” structure usually prevents the business owner from ever realizing on his personal capital gain exemption as regards the accrued gains in Opco shares.

Better alternatives exist for placement of Holdco in the corporate structure, so that ongoing purification dividends can occur on a taxfree basis between corporations, and/or so that creditor-proofing dividends can similarly occur, all the while retaining ownership of the Opco shares in a way that individuals will be able to use their CGE if a buyer is found for the Opco shares while it qualifies as a QSBC. Such alternatives require the insertion of a family trust into the structure, which then directly owns common shares of Opco, and perhaps Holdco.

Not only is it important to have the proper structure in place in order to maximize tax, and preserve wealth, it is equally important that this structure be created at the proper time in the life cycle of the business. Far too many business people have found out this unfortunate truth at the wrong time.

What is the “wrong time”? The wrong time to be thinking about restructuring is when there is “contemplation” of a sale of Opco shares to an unrelated party!

To put some exceedingly complex rules into layman’s language, the Income Tax Act imposes very stringent rules on what can be done in terms of tax-deferred reorganization, when such actions can

sponsor profile

reasonably be considered to be done in “contemplation of sale” to an unrelated party.

In practice what this means is that you have to have your structure right, well in advance of any potential sale activity such that the restructuring activities cannot be considered to part of the same “series of transactions” as the ultimate sale. If the structure is wrong, and a sale opportunity presents itself, it is usually too late to do any tax-efficient restructuring to facilitate the sale because the stringent “in contemplation” rules have been activated. Thus at the exact time you need to have a great structure (at the time of sale), it is typically impossible to create that structure tax effectively if it was not previously in place.

Let us describe is an all-too common experience; “Dave and Marie”, a married couple who have spent their careers creating a successful business “Opco”, had received previous advice to create Holdco to own the common shares of Opco. Dave and Marie each own 50% of the shares of Holdco, which owns all the shares of Opco. This structure was created to allow for ongoing purification of Opco for purposes of the QSBC test, and also just as prudent business practice to facilitate removal of excess assets out of Opco.

Opco has successful over the years and they used the structure as it was intended and now Holdco has $7 million of marketable securities, as well as ownership of Opco shares with a market value that they guess might be on the order of $5 million.

Dave and Marie are very excited when they come to see us as their new tax advisor, as they have just received an unsolicited offer from a company competitor to buy opco at $10 million. The company has even offered to complete the purchase as a purchase of shares (rather than assets), knowing that the after-tax result to Dave and Marie would be substantially enhanced by the $750,000 CGE that each of them could claim. Dave and Marie are fully intending to take this sale offer, utilize each of their personal CGE to partially shelter from tax.

Imagine their disappointment when we tell them that they don’t have any shares to sell that qualify for CGE, since they personally don’t own the Opco shares, Holdco does. The only shares they personally own are Holdco shares, and those shares don’t qualify because Holdco has too much value in marketable securities.

What is the moral of this story? It’s really very simple. Having the right structure at the right time provides the flexibility required to handle a variety of exit strategies well in advance of the actual exit.

If one avoids the “in-line Holdco” structure, with proper planning at the proper time involving use of a family trust all of the benefits of having a holding company in terms of QSBC purification and asset protection will be available, plus the opportunity for multiplication of the CGE is created with family members and/or tax-deferred rollovers of the family business shares to the next generation. Such structuring can also provide protection from the potentially disastrous tax consequences of an untimely death, and provide unparalleled flexibility in income splitting and estate and succession planning.

Some say “timing is everything in life”. This is perfectly true when it comes to creating the proper business structure!

ABOUT THE AUTHOR

Sabrina Fitzgerald Sabrina is a senior manager at PricewaterhouseCoopers LLP (PwC) and is the leader of the Private Company Services – Integrated Solutions group. She specializes in tax, working with owner managers on effective tax planning including structuring, estate and succession planning.

advocate MAY | JUNE 2012

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member notables

Member notables Ron Schlegel Honoured with Diamond Jubilee Medal Local business and community leader Ron Schlegel was awarded the Queen's Diamond Jubilee Medal, "pursuing better living standards for all through his leadership within the business community" in early February. Ron was one of the first 60 recipients of this new honour from across Canada in commemoration of the Queen’s Diamond Jubilee year.

The award was delivered at a special reception presented by the Governor General, and former President of the University of Waterloo, David Johnson and Prime Minister Stephen Harper. At the ceremony the Governor General said of the award’s recipients that “they have improved the well-being of many in our communities, and together, they have helped to create a smarter, more caring nation.”

Contratulations to Ron on this prestigious award recognizing his significant service to Waterloo Region and beyond.

Waterloo Region Record nominated for five National and 13 Ontario Newspaper Awards The Waterloo Region Record has demonstrated again that they are one of the premier newspaper outlets in Canada as they were nominated for 5 National and 13 Ontario Newspaper Awards.

The Record’s finalists for the 5 national awards are: John Roe for editorials, Mathew McCarthy for feature photography, Josh Brown for sports and Chuck Howitt for business.

The Record has also been nominated in the special project category for a series on local transit – In Transit – written by Jeff Outhit.

The Record also received 13 nominations in the Ontario Newspaper Awards across numerous categories such as business writing, sports writing, and online photography. Only the Hamilton Spectator and the Windsor Star received more nominations.

Flightpath Charter Airways Earns Trailblazer Award at Entrepreneurial Awards On March 6, Flightpath Charter Airways was given the Trailblazer Award by the Waterloo Region Small Business Centre and the Wellington-Waterloo Community Futures Corporation for making an impact on our local economy through their intrepid, entrepreneurial spirit.

Flightpath Charter Airways Inc. is a private aircraft charter service based out of Hanger 17 at the Waterloo Regional Airport catering to professionals and businesses who are searching for time and cost effective transportation solutions. With their fleet or jet and prop aircraft Flightpath Charter Airways is making it easier for businesses to afford the convenience of private aircraft chartering.

Member Notables are taken from local news sources and member submissions. In order to be considered “notable” an item must be an accomplishment or event that is outside of the ordinary course of business and therefore deemed newsworthy. While we would like to include all submissions, space constraints make it necessary for the Advocate editors to choose items that best fit the above criteria and are most timely.

advocate MAY | JUNE 2012

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member notables

February 1, 2012 to March 31, 2012 (continued from page 13) Kitchener Hyundai

Network Partners

The Event Film

Automobile Dealers Brett Williamson, General Manager 44 Alpine Road, Kitchener, ON N2E 1A1 Email: bwilliamson@kitchenerhyundai.com Web: http://www.kitchenerhyundai.com Phone: (519) 742-4400 / Fax: (519) 742-9374

Computer Consultants Mr. Richard Mash, President 511 Wood Nettle Way, Waterloo, ON N2V 2X9 Email: info@networkpartners.ca Web: http://www.networkpartners.ca Phone: (226) 989-4222

Video Production Cathy Lumb, Film Producer 28 Schneider Avenue, Kitchener, ON N2G 1K6 Email: info@theeventfilm.com Web: http://www.theeventfilm.com Phone: (519) 886-4198 / Fax: (519) 886-6090

Ledgers Kitchener

Proforma Total Marketing Solutions

The Williamsburg Arms Pub

Accounting & Bookkeeping Services Jeff Metzger, President 55 King Street West, Unit 700, Kitchener, ON N2G 4W1 Email: jmetzger@ledgers.com / Web: http://www.ledgers.com Phone: (519) 745-2249 / Fax: (866) 850-1823

Printers Adrian Agostan, Owner 145 Bedford Road, Kitchener, ON N2G 3A3 Email: adrian.agostan@proforma.com Web: http://www.proforma.com/totalmarketingsolutions Phone: (888) 610-6267 / Fax: (866) 887-1595

Restaurants Melinda Corturiend, General Manager 1187 Fischer Hallman Road, Kitchener, ON N2E 4H9 Email: info@williamsburgarms.com Web: http://www.williamsburgarms.com Phone: (519) 745-6460

Left Align Design Contemporary Art

Prosperous Business Consulting

TMC Custom Graphics & Installs

Artists - Fine Arts Barbara Di Renzo 43 Memory Lane, Cambridge, ON N3C 3X7 Email: leftaligndesign@yahoo.ca Web: http://www.leftaligndesign.ca Phone: (226) 218-5115

Business Consultants Kevin Ballantyne, Managing Director 36 Silverspring Crescent, Kitchener, ON N2M 4P2 Email: kballantyne@prosperousbusinessconsulting.com Web: http://www.prosperousbusinessconsulting.com Phone: (519) 279-6225

Graphic Designers Tyler Murdock, Owner/Operator 460 Colt Street, Waterloo, ON N2K 4N8 Email: tylermurdock77@gmail.com Phone: (519) 580-7774

Little Bean Coffee Bar

Ready2Grow Associates

Restaurants Charmaine Ramkalawan, Owner 417 King Street West, Kitchener, ON N2G 1C2 Email: littlebeancoffeebar@rogers.com Web: http://www.littlebeancoffeebar.ca Phone: (519) 954-7872

Management Consultants Lois Raats, Principal 20 Ellen Street East, Unit 508, Kitchener, ON N2H 6R7 Email: info@ready2grow.com Web: http://www.ready2grow.com Phone: (519) 883-8838

Living Fresh - Flowers and Interiors

Riley Painting Corp.

Florists Tina Riddell, Owner 12 East Avenue, Kitchener, ON N2N 2M7 Email: tina@livingfresh.ca / Web: http://www.livingfresh.ca Phone: (519) 573-9039

Painting Contractors Dennis McMahon, President 27 Evening Star Lane, Conestogo, ON N0B 1N0 Email: dennis@rileypainting.com Web: http://www.rileypainting.com Phone: (519) 664-1426 / Fax: (519) 664-1549

Miovision Technologies Inc Computer Software Aaron Bast, CFO 148 Manitou Drive, Unit 101, Kitchener, ON N2C 1L3 Email: info@miovision.com Web: http://www.miovision.com Phone: (519) 513-2407 / Fax: 1 (886) 413-2928

Momentum Developments Real Estate Developers Brian Prudham 55 Northfield Drive East, Unit 285, Waterloo, ON N2K 3T6 Email: info@momentumdevelopments.ca Web: http://www.momentumdevelopments.ca Phone: (866) 533-4649

Myron Steinman - Community Resource Facilitation Home Health Care Services Myron Steinman, Sole Proprietor/Facilitator 170 Cherry Street, Unit C3, Kitchener, ON N2G 5A1 Email: myrons@communityfacilitation.ca Web: http://www.communityfacilitation.ca Phone: (519) 208-0268

Robert Linsley Artist Artists - Fine Arts Robert Linsley, Owner 31 Gordon Avenue, Kitchener, ON N2H 1N4 Email: rlinsley@gmail.com Web: http://www.robertlinsley.com Phone: (519) 585-1588

Robson Carpenter LLP Lawyers David Sunday, Lawyer 10 Northumberland Street, Ayr, ON N0B 1E0 Email: info@rcllp.ca / Web: http://www.rcllp.ca Phone: (519) 632-1327 / Fax: (519) 632-1328

The Duke & Duchess Pub Restaurants Billy Fatkin, General Manager 900 Jamieson Parkway, Cambridge, ON N3C 4N6 Email: info@dukeandduchess.ca Web: http://www.dukeandduchess.ca Phone: (519) 654-2224

The Duke of Wellington Restaurants Desi Fatkin, Owner 33 Erb Street West, Waterloo, ON N2L 1S8 Email: info@dukeofwellingtonpub.com Web: http://www.dukeofwellingtonpub.com Phone: (519) 886-9370

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Tri-City Office Furniture Inc. Office Furniture & Equipment Ken Norton, President 385 Dundas Street North, Cambridge, ON N1R 1M7 Email: info@tricityofficefurniture.com Web: http://www.tricityofficefurniture.com Phone: (519) 267-3648 / Fax: (519) 622-5756

Tri-Mach Group Inc Manufacturing Consultants Krystal Darling, Sales and Marketing Manager 315 Breithaupt Street, Kitchener, ON N2H 5H6 Email: kdarling@tri-mach.com Web: http://www.trimach.com Phone: (519) 744-6565

Waterloo Arms Restaurants Michelle , General Manager 338 Waterloo Street, Units 14,15,16 New Hamburg, ON N3A 1K6 Email: info@waterlooarms.com Web: http://www.waterlooarms.com

WatSec (WaterlooSecurity Ltd.) Computer Consultants Doug Blakey, President/CEO 295 Hagey Boulevard, Waterloo, ON N2L 6R5 Email: dblakey@watsec.com / Web: http://www.watsec.com Phone: (519) 747-2549

WatServ ERP Cloud Computing Computer Software Tom Doerner, President Allen Square -180 King Street South, Suite 602 Waterloo, ON N2J 1P8 Email: tdoerner@watserv.com Web: http://www.watserv.com Phone: (519) 279-4025

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advocate MAY | JUNE 2012

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feature

Chamber Star: Steve Southern The Chamber Star was developed to recognize volunteers and is a way for the Chamber to show appreciation for their significant efforts. It is awarded to an active committee member three times a year, following a Committee Chair nomination process. We are excited to announce that Steve Southern is the newest recipient of the Chamber Star.

Within the Chamber, Steve is an active volunteer on the Business Excellence Awards Nominations committee. Members of this committee serve as “Champions� of the various awards categories for the Chamber’s Annual BEA Gala, taking the time to read and summarize nomination packages and ultimately present recommendations for their respective categories to the final judging panel. BEA Nominations Committee Chair Laura Richards applauded Steve for his dedication and work ethic as well as his willingness to put forward new ideas. Steve is also involved in the pilot of the Chamber’s new Peer to Peer Program as a member of the Business Development Group.

Aside from his work with the Chamber, Steve is active within the community, volunteering with such organizations as the Centre for Family Business and Junior Achievement of Waterloo Region. In addition to donating his time with these organizations, Steve also lends his expertise as a mentor to local entrepreneurs.

Professionally, Steve is the Principal of S.H. Southern and Associates, a partnership between Ogilvie Doherty Financial Services and PROCORP Financial Technologies that aims to provide entrepreneurs facing complex financial challenges with solutions tailored to their specific needs. In addition, Steve has had an active role in three start-up technology companies.

Thank you Steve for all of your efforts!

Private Company Services www.pwc.com/ca/private

Generation to generation, not quarter to quarter It pays to think long-term. We can help create lasting value IRU \RXU EXVLQHVV IRU \RXUVHOI DQG IRU IXWXUH JHQHUDWLRQV

Glen Dyrda Managing Partner, Southwest Ontario 519 570 5715 glen.m.dyrda@ca.pwc.com

Sabrina Fitzgerald Private Company Services Integrated Solutions Leader 519 570 5758 sabrina.r.ďŹ tzgerald@ca.pwc.com

Martin Kern Tax Partner 519 570 5711 martin.kern@ca.pwc.com

Kate Phillips Client Relationship Executive 519 570 5720 kate.g.phillips@ca.pwc.com

Š 2012 PricewaterhouseCoopers LLP. All rights reserved. In this document, “PwC� refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership, which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity. 2175-14 0312

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sponsors

Helping us make our vision possible A special Thank You to each of these Chamber Sponsors.

CHAMBER CHAIR’S CIRCLE

CHAMBER PATRON

CHAMBER

CONNECTIONS Manulife Financial

TITLE SPONSOR

LEADERSHIP SERIES

CHAMBER TRUSTEE

MEDIA PARTNERS advocate MAY | JUNE 2012

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Uncover skilled talent or new opportunities in Canada’s bio-economy Bio-business is becoming big business in Kitchener-Waterloo. The BioManufacturing Skills Transfer Program from BioTalent Canada™ connects employers with skilled, BioReady™ professionals — and workers with the tools they need to pursue bio-economy careers.

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