Marijuana stocks may have leapt higher on the news of Ottawa's plans to legalize the drug by next year, but the industry is facing an uphill battle in building trust with Canadian consumers, according to a new survey.
When Environics Communications asked whether they trust companies in each sector to "do what is right for Canada, Canadians and our society," survey respondents ranked marijuana dead last among roughly 20 sectors – giving it a lower trust rating than such sectors as pipelines, social media platforms, and pharmaceutical companies. Just 13 per cent of roughly 1,500 people gave marijuana companies a rating of five or higher on a seven-point trust scale.
The findings differ somewhat by age group, but trust is an issue across the board: Just 10 per cent of people over 50 trust marijuana producers, while only 17 per cent gave a rank of five or higher amid the highest-trust group, those between the ages of 18 to 24.
To some extent, this is to be expected with an industry that is still illegal in Canada for recreational use, Environics acknowledges. However, even the sanctioned side of the business, medical marijuana, has been plagued with problems of trust, raising questions about how the industry will be managed as it expands.
Three class-action lawsuits have been launched recently over tainted marijuana that contained banned pesticides. The Globe and Mail revealed in December that medical marijuana containing myclobutanil, which is not approved for use on plants that are smoked – including tobacco and cannabis – and can emit hydrogen cyanide when heated, had been sold by Mettrum. Similar recalls were then issued by Organigram Inc. and Aurora Cannabis, had purchased bulk product from OrganiGram for resale. The recalls raised questions about Health Canada's oversight of the sector, since the regulator had not been testing for any banned chemicals.
Now, the cannabis business is set to grow amid reports this week that the federal government is working on legislation to legalize recreational marijuana use as early as next year.
In its survey, conducted in January, Environics asked Canadians whom they would trust to distribute marijuana, whether medical or recreational. Drug stores and pharmacies ranked highest, with just more than half of people scoring them at five or higher on a seven-point scale of trust, while privately-owned dispensaries ranked lowest. Fully one-third said that they would not trust any of the options – from government-run dispensaries to private stores – to do the job.
"While legalization over all enjoys popular support, the devil will be in the details and there is abundant room for missteps as the marketplace is created and governed," said Environics chief executive Bruce MacLellan. "It will not be an easy win for anyone."