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Rebuilding trust with sponsors will be next challenge for Hockey Canada

Hockey Canada did just enough to provisionally regain its funding. But rebuilding the trust it once had with major sponsors will be another challenge in itself, suggests a marketing expert.

The national sporting body was granted its funding from the federal government on Sunday after having it frozen on June 22, 2022 by sport minister Pascale St-Onge. Hockey Canada could face a scenario where companies that suspended or halted their sponsorship may have conditions too.

“The first signal (companies are) looking for (is) government, new people, new accountability and transparency actions. But I’m going to say, the toughest thing to rebuild is trust,” Dr. Joanne McNeish, a marketing management professor at Toronto Metropolitan University told The Canadian Press. “And trust once broken, it is never going to be the same.

“… That means guarantees, the money provided will come with strings around transparency. The corporate for-profit brands and sponsors will be much more cautious in sort of the freedom with which they gave the money. 

“In other words, maybe before, the details weren’t just spelled out. So it’s additional legal and contractual obligations, which is costly for a non-profit.”

The lost sponsorship dollars — which was reported last year to be $23.5 million — and loss of funding was a result of the revelation last May that a woman alleged she was sexually assaulted by eight players — including members of the 2018 world junior team — following a foundation gala in London, Ont. in June 2018.

Hockey Canada and the woman quietly settled a $3.55-million lawsuit out of court.

The organization then announced members of the 2003 men’s world junior roster — the last time Halifax hosted — were also being investigated for a group sexual assault.

Although Hockey Canada has since brought in new leadership and met the conditions to have its funding restored by St-Onge, the decision was met with disagreement by some members of Parliament on Monday.

Hockey Canada’s leverage in negotiations with potential or past sponsors will be effected, McNeish said.

“It leaves the organization in a very poor negotiating position. You literally have to take what they give you,” she said. “You don’t have a chance to say, ‘Well, we have other people who will be wanting to sign up with us.’ 

“So the organization itself is in a place of almost begging for people to sponsor it, and they’ll have to accept for a while the terms that they’re given. And that’s uncomfortable. That’s not a great place to be as a non-profit.”

While some may return, for others, it may not be worth the risk, McNeish added.

“They won’t sign up again. Other brands will take a longer view and say ‘Yes, this is an important partnership for us and hockey is an important sport in Canada, we want to support the community and the grassroots level,’ so now it will be more targeted sponsorship,” McNeish said. “Very specific and that the public link will be less visible.”

Companies like Tim Hortons opted to continue to fund Canada’s women’s and para hockey teams, as well as youth hockey, while pulling out of all men’s hockey programming for the 2022-2023 season including the men’s world junior championships.

“So many of these organizations want to support the grassroots level. That’s important to them,” McNeish said. “They will align with them but it’ll be very directed funding. I would imagine that for some of them it’s an appropriate place. 

“Hockey Canada is important, but it’s at the community level because remember, Hockey Canada is (young) hockey players. It is developing the kids, it’s the coaches who work really hard, so brands don’t want to be seen to make it to thinking they were the guilty people. The guilty people were at the management organization level.”

Scotiabank, Canadian Tire, Nike, and Tim Hortons have yet to respond for comment on whether they will follow Ottawa’s lead and resume their partnerships with Hockey Canada.

This report by The Canadian Press was first published April 19, 2023.

Abdulhamid Ibrahim, The Canadian Press