During a speech at the Canadian Club of Montréal, Monique F. Leroux calls upon businesses to create a truly innovative and productive culture.

MONTREAL - With the challenges faced by Québec as well as the conditions necessary to implement sustainable prosperity at home, Monique F. Leroux, President, Chair of the Board and CEO of Desjardins Group, reminded the audience of the Canadian Club of Montréal that in order to become the best in their respective fields, businesses will have to focus their strategies on innovation. "Then, and only then, will we collectively meet the productivity challenge and aspire to sustainable prosperity," she said during her Taking Innovative Action for Sustainable Prosperity conference.

Ms. Leroux believes that an economic recovery is finally within reach. "Many signs point to the beginning of a recovery and allow us to anticipate a gradual improvement of the situation," she said, all the while encouraging her audience to be prudent and vigilant as major challenges are looming.

The most fundamental of these challenges, likely to have an impact on most others, is of a demographic nature. It is also unavoidable, considering the imminent retirement of Québec's largest generation. "In the coming decade, the rapid aging of the population, and incidentally, the decreased number of persons who are active participants in the job market will affect the entire dynamic of Québec's economic growth and make the management of public finances rather delicate," Ms. Leroux claims.

In her opinion, the potential for economic growth is based on two main elements: the progression of the working population and productivity gains. However, it is widely known that the population of labour-force age will start decreasing as of 2014. "If, in the next decade, productivity growth remained at the same pace as in the past 10 years, about 1% on average annually, the decrease of the working population will drag the progress of economic growth under 1% by 2020. All signs show that this trend will continue over the next decade," she added.

This issue is essential for Québec, as growth below 1% is equivalent to near-stagnation of the economy and a stall in wealth creation, she stated.

Ms. Leroux, who believes Desjardins can provide an active contribution to the collective response to the challenges facing businesses to revive the economy, insists on the fact that the cornerstone of our future prosperity is none other than higher productivity gains. In her opinion, it is thus important to take immediate action.

Many factors influence productivity. However, Desjardins agrees with the Council of Canadian Academies on innovation being the most determining factor in terms of productivity. "Innovation first and foremost allows the economy to increase production of goods and services from quantities of fixed resources. Through innovation, new and better ways of doing things create this value. By being more efficient and innovative with their resources, the competitiveness of companies is strengthened," Ms. Leroux said.

Citing Cirque du Soleil as an example, which innovated by transforming the traditional circus experience, or Desjardins Group, whose founder Alphonse Desjardins put in place an unprecedented business model, Ms. Leroux invited businesspeople to innovate constantly. "All processes within a business can be improved and give way to innovation, from gathering raw materials to after-sales service."

Today, Desjardins Group identifies with these major collective challenges, Ms. Leroux said. "Instead of being satisfied with the status quo, that is why we once again choose growth and openness towards the future (...) We are simplifying our overall management structure for greater cohesion within Desjardins as well as improved proximity between caisses and their members. We want a Desjardins that is closer to its caisses, and caisses that are closer to their members."

"To meet the challenges of productivity and sustainable prosperity together, we must show willingness, perseverance, a greater sense of our collective responsibilities and a true desire for cooperation. In Québec, we have assets and strengths that other countries can envy: a diversified economy, major natural resources, energy sources, abundant water sources, a solid service sector, strong democratic values and a long tradition of solidarity, collaboration and cooperation. To repeat the words of Alphonse Desjardins, let's not allow these incomparable advantages that we possess to lie dormant in a shameful bout of inactivity. It is up to us to innovate in order to develop these advantages and help nurture the heritage we will pass along to our children for their future," she concluded.