The person who mows lawns in your neighbourhood, the local pizza franchise, your credit union, Canada Post and a huge bank are all businesses, but they are set up very differently. Who owns them, who gets the profit and who is responsible for the debts all change from one type to the next. Knowing the types helps you pick the right one if you start a business, and helps you understand the role each plays in Canada's economy and in the world.
Types of business ownership
| Type | Who owns it | Key feature | Example |
|---|---|---|---|
| Sole proprietorship | One person | Easy and cheap to start, but the owner is personally responsible for all debts (unlimited liability) | A student's dog-walking business |
| Partnership | Two or more people | Owners share the work, money and decisions, and usually share the debts | Two friends running a bakery |
| Corporation | Shareholders (people who buy shares) | A separate legal "person"; owners can lose only what they invested (limited liability) | A large Canadian bank |
| Co-operative | Its members, one vote each | Run to serve its members, not outside investors | A credit union; a farmers' co-op |
| Franchise | A local owner (franchisee) who pays a parent company (franchisor) | Uses an established brand and system in return for fees | A Tim Hortons restaurant |
| Social enterprise | Varies | Sells goods or services to fund a social or environmental mission | A café that trains and hires people facing barriers to work |
| Crown corporation | A government (usually federal or provincial) | Provides a service the government thinks is important | Canada Post, VIA Rail, CBC/Radio-Canada |
Sectors, sizes and roles in the economy
Businesses are also grouped by sector. The primary sector takes natural resources from the earth: farming, fishing, forestry, mining. The secondary sector turns those resources into products: factories, bakeries, construction. The tertiary sector provides services: stores, banks, restaurants, hair salons, health care. Follow a loaf of bread: a farmer grows wheat (primary), a bakery makes bread (secondary) and a grocery store sells it (tertiary). Most Canadians work in the tertiary (service) sector. By size, Canada's federal government usually counts a business with 1 to 99 employees as small, 100 to 499 as medium and 500 or more as large. The great majority of businesses in Canada are small. Small and medium businesses create many local jobs and serve their communities; large businesses and corporations often compete around the world, export Canadian products and run operations in many countries. In the global economy, Canadian businesses sell abroad (exports), buy from abroad (imports) and sometimes open locations in other countries.
- 1A plant that boils, bottles and labels the syrup
- 2A sugar bush that taps maple trees
- 3A grocery store that sells the bottles
Working with Indigenous entrepreneurs and communities
First Nations, Métis and Inuit people own and run businesses across Canada in every sector, from construction and tourism to fashion and technology. Manitobah Mukluks, an Indigenous-owned footwear company based in Winnipeg, is one well-known example. Canadian businesses are increasingly building partnerships with Indigenous entrepreneurs, businesses, organizations and communities. Here are some of the main ways:
- Impact–benefit agreements (IBAs): contracts between a company, such as a mining or energy company, and an Indigenous community affected by a project. They often cover jobs, training, business contracts for community-owned companies, environmental protection and a share of the money the project earns.
- Indigenous procurement: procurement means buying goods and services. Indigenous procurement means a business or government deliberately buys from Indigenous-owned businesses. The federal government has set a target that at least 5% of the total value of its contracts go to Indigenous businesses.
- Progressive Aboriginal Relations (PAR): a certification program run by the Canadian Council for Indigenous Business. It recognizes companies that show real progress in Indigenous employment, business development, community relationships and leadership.
- Joint ventures and partnerships: a company and an Indigenous-owned business work together on a project and share the risks and rewards.
- Hiring, training and scholarships for Indigenous youth, and training staff about Indigenous histories and rights.
Reconciliation is the ongoing work of building respectful, fair relationships between Indigenous and non-Indigenous peoples in Canada, after a long history of harm, including residential schools. In 2015 the Truth and Reconciliation Commission of Canada (TRC) published 94 Calls to Action. Call to Action 92 is aimed at business. It asks the corporate sector in Canada to adopt the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) as a framework for reconciliation, which includes meaningful consultation, building respectful relationships, and obtaining the free, prior and informed consent of Indigenous peoples before economic development projects go ahead. It also asks businesses to ensure that Indigenous peoples have equitable access to jobs, training and education in the corporate sector, that Indigenous communities gain long-term benefits from economic development, and that managers and staff are educated about Indigenous histories and rights. Partnerships built with respect and real consultation help Indigenous communities build wealth and shape their own economic future, and help businesses build trust and long-term relationships. That is one practical way business contributes to reconciliation.