Chapter 4: Alignment in sport system structures

Part I — The Canadian sport system

Sport system structures: preliminary findings and recommendations

As outlined in the previous section on the sport system, there are too many National Sport Organizations vying for too few resources (both financial and human). This has created competition rather than collaboration within the sport system.

Furthermore, the sheer number of National, Provincial and Territorial Sport Organizations creates redundancies. They all have boards of directors, staff and coaches. Many also have their own internal legal, human resources, communications, information technology (IT) and accounting departments or are required to purchase these services elsewhere.

Despite the rules of competition for each sport permeating from the national level all the way to the grassroots, National Sport Organizations seem to generally have limited policy and programs influence across the other levels of their sport. A further challenge to alignment in the sport system is the emergence and growth of private entities, typically not affiliated with sport organizations.

There is also inconsistency across and within provinces and territories with regard to the number of Provincial and Territorial Sport Organizations and the integration of parasport with other sports. It is important to recognize that the integration of parasport may not always be optimal. This is due to the unique realities of athletes with disabilities, which include the need for disability-specific expertise and equipment.

The Commission recognizes that the funding of the Canadian sport system is a fundamental concern, made more complex by the current fiscal and geopolitical context. The funding of the sport system is discussed in Chapter 5, where the Commission recommends, among other things, that the federal government increase and stabilize the funding provided to National Sport Organizations. We would like to emphasize that increasing funding does not remove the need to find efficiencies and create synergies within the sport system.

In this chapter, we outline several options to strengthen alignment and create efficiencies within the sport system at the national level (“horizontal alignment”) and between the national, provincial and territorial, and community levels of sport (“vertical alignment”). We also consider the opportunity to enhance the services and support afforded to parasport athletes and organizations.

Horizontal alignment: preliminary findings

Horizontal alignment generally refers to the coordination of efforts within a specific level of an organization or system (for example, national or provincial level).^{Footnote 1} For the reasons outlined below, the Commission is of the view that horizontal alignment could be achieved in several ways. This includes the amalgamation of National Sport Organizations and the sharing and standardization of common services across these organizations.

Recognizing that the amalgamation of National Sport Organizations may require significant time and effort, the Commission is of the view that a phased approach should be considered to allow sport organizations to adapt and evolve in a measured way.

Therefore, the Government of Canada could first encourage National Sport Organizations to develop and establish a horizontal shared services model. This model would aim to create efficiencies and synergies within and among National Sport Organizations. Establishing a horizontal shared services model would centralize common services that are not specific to any sport or organization. These services could include, among others, information technology (IT) support, human resources, legal, translation, and other professional services.

As a second step, the federal government could then work with National Sport Organizations to encourage and incentivize them to explore potential amalgamations.

Amalgamation of National Sport Organizations

The suggestion that National Sport Organizations be amalgamated is by no means new. In July 2020, Biathlon Canada, Nordic Combined Ski Canada, Nordiq Canada and Ski Jumping Canada agreed to explore a “more unified approach to developing and operating Nordic sports in Canada.”^{Footnote 2} A steering committee considered potential areas of formal and informal collaboration, exploring everything from athlete- and coach-development pathways, operating models and revenue generation. Their work led to the creation of the Nordic Strategy.

The efforts needed to create the Nordic Strategy were extensive. Four working groups were formed with members from each National Sport Organization to make recommendations on the topics of Revenue Generation, Membership/Participation, Sport Performance, and Administration. These groups presented their recommendation to the Steering Committee, which then developed an initial business case, engaged with the Boards of Directors of each National Sport Organization, and met with sport partners including Sport Canada, the Canadian Olympic Committee and Own the Podium.^{Footnote 3}

The Steering Committee concluded that:

[...] the best way forward [was] through the creation of a new, single [National Sport Organization] responsible for all Nordic disciplines. The proposed [National Sport Organization] would centralize governance and administration while allowing for high-performance and national team programs specific to each discipline.^{Footnote 4}

Additional resources were invested in this project, and an external consultant was hired to build a more detailed business case for a single national sport organization model. This work involved conducting a comprehensive review of all four National Sport Organizations and facilitating a stakeholder engagement process.^{Footnote 5}

Despite significant work, the four Nordic sports could not agree on amalgamation terms. As such, they continue to operate as separate entities. The Commission was told that the outcome would likely have been different if the government had offered incentives, such as additional funding to encourage amalgamation and recognize the efficiencies it would create.

Some participants provided options for the amalgamation of National Sport Organizations, but many National Sport Organizations were averse to this approach. They expressed concerns about various potential losses, including:

• Loss of sport-specific funding, whether through contributions from governments or membership fees.
• Loss in voting power, whether at the board level of a combined sport entity or with Multisport Service Organizations like the Canadian Olympic Committee.
• Loss of sport-specific technical expertise.

Government officials and several National Sports Organizations noted that there is little motivation for amalgamation and suggested that funding incentives could serve to encourage organizations to consider such an option.

Those who supported the amalgamation of National Sport Organizations, including some sport organizations, felt that aligning the Canadian sport system with the international sport federations would reduce expenses and standardize sport programs in similar disciplines.

It was pointed out, however, that simply because sports fall under the same International Federation, it does not automatically mean that they should be amalgamated at the national level. Some expressed that their sport at the international level was not getting the same attention as other sports under the same International Sport Federation.

Others suggested that amalgamation should be based on similarities between sports or on their size. Some even suggested creative ideas such as combining some summer and winter sports to explore efficiencies during the respective sport seasons.

The Commission recognizes that amalgamation of National Sport Organizations or, any form of consolidation, will have an impact on those involved in the Canadian sport system. These impacts do not mean that sectoral and organizational change should not be undertaken, but rather that it should be undertaken carefully and thoughtfully.

Such an approach would lead to centralization of services and improved alignment, thereby producing greater consistency and efficiencies in the sport system. It would also create new opportunities, afford more stable employment, and permit more strategic approaches to the development of additional financial resources.

Any strategy to amalgamate National Sport Organizations should include incentives from the Government of Canada. A commitment to provide additional funding to support organizations undertaking an amalgamation process, and additional funding to newly amalgamated National Sport Organizations, would serve to both stimulate and reward those who embarked on such an organizational journey.

Shared services by National Sport Organizations

A shared services model by National Sport Organizations could improve not only the operations of sport organizations, but also collaboration between them.

The Commission notes that collaboration is already happening among certain National Sport Organizations. For example, national Summer and Winter Olympic, Paralympic, Pan American, Parapan American and Commonwealth Games sport organizations regularly meet, collaborate and advocate as the Summer Sports Caucus and Winter Sports Caucus, respectively.

In addition, in the 1980s and 1990s, Sport Canada required many National Sport Organizations to have their national office in Ottawa as a condition to receive funding. At that time, these offices were co-located at the Canadian Sport and Fitness Administration Centre.^{Footnote 6}

While no longer required to the same degree, similar structures exist today. In some cases, co-working spaces, meeting rooms and collaborative spaces for sport organizations exist.^{Footnote 7} Access to these spaces is provided to member organizations, which can include National Sport Organizations, national Multisport Service Organizations, as well as provincial and territorial, and local sport organizations.^{Footnote 8} The motivation behind these spaces is to facilitate knowledge and information-sharing, and to leverage operational efficiencies. Some of these spaces provide services, which can include information technology (IT) support and access to meeting rooms.^{Footnote 9}

It was suggested that shared services could be implemented within each of the Canadian sport system’s jurisdictions. For example, the Commission was informed that Sport Québec, a provincial multisport service agency responsible for oversight and leadership of sport in the Province of Quebec, offers payroll services and legal counsel to smaller provincial sport organizations. A similar approach could be initiated at the federal level.

No matter how services are shared, it was agreed that doing so would reduce expenses for sport organizations and allow them to focus on the delivery of programs. This was supported by National Sport Organizations and National Parasport Organizations.

It was also felt that, if a new organization was created based solely around the sharing of services, its funding should be assured independently of the membership fees collected by National Sport Organizations. In other words, those fees should stay within the sport. A commitment to the ongoing financial support of this new organization was seen as essential to building trust within the sport system in order to achieve any such change.

Below are options the Commission considered to strengthen horizontal alignment across all levels of sport in Canada. These options could be implemented individually as standalone solutions or combined to achieve a greater overall impact.

Horizontal alignment: preliminary recommendations

The Commission therefore recommends that:

1. The Government of Canada, through incentives, encourage National Sport Organizations to amalgamate.
2. The Government of Canada, through incentives, encourage National Sport Organizations to establish and implement a horizontal shared services model to centralize common services among these Organizations, such as information technology (IT) support, human resources, legal services, translation services, insurance provision, and a shared foreign exchange strategy.
3. The Government of Canada, through incentives, encourage National Parasport Organizations to establish and implement a shared services model tailored to the needs of the parasport community.
4. The Government of Canada create a strategic transformation fund to support National Sport Organizations, including National Parasport Organizations, through the horizontal amalgamation and/or shared services process.

Parasport alignment: preliminary findings

The parasport system is not immune to issues of alignment and efficiencies both at the national and provincial and territorial levels.

At the national level, four parasport organizations are recognized and funded by the federal government. There are also other national-level parasport organizations that operate independently within the broader sport system, such as Canadian Blind Hockey, a charitable organization.^{Footnote 10}

There has been a push to integrate within the same national governing body parasport and non-parasport. As such, many National Sport Organizations responsibilities extend to parasport.

A similar combination of organizations operates at the provincial and territorial level and at the community level of sport, providing opportunities for persons with disabilities to participate in sport. Ultimately, parasport is delivered by a wide variety of organizations, with differing mandates, capacities and geographical reach. These organizations generally have similar objectives.

Some suggestions have been made to improve the efficiency and cohesion of the parasport system in Canada. These include integrating parasport organizations within non-para sport organizations while establishing clear policy and program frameworks to ensure that the parasport community is appropriately served.

While the integration of parasport organizations into their sport equivalent has already occurred in some settings at the national level, other parasport athletes and sport administrators were overwhelmingly against further integration. They stated that within integrated sport organizations, parasport programs may get lost and are often not viewed through a parasport lens resulting in the loss of a perspective necessary to ensure that the needs of parasport athletes, like, travel accommodation and equipment, are appropriately met.

We also understand that while financial incentives to integrate may be offered, there is no guarantee that they will follow. This creates a risk that potential integration could be seen as leading to reduced funding.

Many parasport organizations and athletes are not in favour of any further efforts to integrate parasports. At present, as has been noted, both integrated and non-integrated sports exist, thereby creating inconsistencies across all levels of the sport system.

The structure of parasport organizations in Canada makes vertical alignment more difficult to achieve. While at the national level, parasport organizations and programs are sport-specific, whether they are integrated or non-integrated sports, at the provincial and territorial level, they are frequently administered and overseen by a variety of sport organizations. At the community level, a combination of multisport organizations and sport-specific sport organizations, both integrated and non-integrated, provide services, in addition to those offered by local charitable and not-for-profit organizations.

The Commission heard about these nuances and the disability-specific needs of athletes. In particular, it was suggested that when athletes with a disability are in a high-performance stream at the national level, it would make sense for them to be integrated into the National Sport Organization. This would ensure that these athletes would receive high performance, sport-specific coaching and support.

At the grassroots level, however, the focus would shift to the disability needs of athletes because individuals with the same disabilities will, generally, have similar equipment and sport needs. As an example, a high-performance para-athlete who competes at the international level in sprinting may need to work with a coach who not only understands their disability needs but also the specific circumstances and challenges of their sport. A community-level para-athlete would benefit from the broad guidance and opportunities provided by those who recognize the more general needs of those entering sport.

In programs focused on sport participation and sport for development, disability needs may take priority over specialized sport considerations. For example, an athlete in a wheelchair may be able to try and learn wheelchair basketball and wheelchair football in a multisport organization that specializes in working with athletes who use wheelchairs. This format would also allow athletes to try multiple sports and to interact with other athletes with similar disabilities and adaptive needs.

The Commission recognizes the unique circumstances of parasport organizations. One important consideration is that, for some sports, the participant base is small because of the prevalence of a specific disability within the Canadian population. In addition, we are aware that the needs of athletes with disabilities differ, not only from those of athletes without disabilities, but also among athletes with disabilities. The Commission did hear of the need for parasport expertise when it comes to services such as classification and travel arrangements. We also recognize that this may be true in other instances, such as event planning and communications.

Alignment and consistency in the way parasport is structured may not be optimal given the unique circumstances and needs of para-athletes. We recognize that parasport involves additional costs due to the unique needs of its athletes. Therefore, additional funding should be allocated to National Parasport Organizations. This recommendation is addressed in the Funding Chapter (Chapter 5).

In addition, the Commission is of the view that a national parasport specific policy and program framework should be developed in collaboration with the parasport community.

Parasport alignment: preliminary recommendations

The Commission therefore recommends that:

5. The Government of Canada, in collaboration with the parasport community at the national, provincial and territorial levels, develop a national parasport strategy. This role should be transferred to the Centralized Sport Entity outlined in Chapter 6 once it is established.

Vertical alignment: preliminary findings

As discussed in the previous section, horizontal alignment aims to improve efficiency across a single level of an organization or system. Vertical alignment refers to improving the functioning across hierarchical levels of a system or organization.^{Footnote 11} For example, within one sport, from National Sport Organizations to Provincial and Territorial Sport Organizations and then to the community level.

As outlined below, to create efficiencies and synergies within and among sports, and to strengthen alignment between the levels of sport, the Commission is of the view that:

• National Sport Organizations should seek broad application of policies across all levels of their sport.
• Common services for National Sport Organizations and their respective Provincial and Territorial Sport Organizations should be centralized in a shared services model.
• Provincial and Territorial Sport Organizations should be considered in any amalgamation efforts undertaken by their National Sport Organization counterpart.

Roles and responsibilities

The Commission heard that the relationship between National Sport Organizations and Provincial and Territorial Sport Organizations can vary significantly. While these organizations work well together in some sports, they do not in others. This also varies from jurisdiction to jurisdiction.

Part of this tension could be attributed to the differing goals and objectives of National, Provincial and Territorial Sport Organizations as they relate to increasing participation. It is true that Provincial and Territorial Sport Organizations (and their community sport organizations members) develop athletes who may ultimately earn medals on an international stage. But this is not their primary objective.

The tension can also be attributed to a lack of clarity about the roles and responsibilities among sport organizations at different levels. This often creates duplication and inefficiencies in the sport system.

There is a common misconception that National Sport Organizations have control over their sport from the national level to the grassroots. In reality, a vast majority of National Sport Organizations have very little oversight and control over their provincial and territorial member organizations, and even less over clubs as most national organizations are disconnected from the grassroots.

As things currently stand, there is a need for greater clarity around the roles and responsibilities of sport organizations at each level of the sport structure. Amalgamation would not only eliminate duplication in the Canadian sport system and enhance the relationships between and among such organizations it would also assist in clarifying the roles and responsibilities of the organizations.

Shared services

Just as we discussed implementing a shared services model at the national level, a similar approach could be adopted at the provincial and territorial level. A single entity would provide all Provincial and Territorial Sport Organizations with the provision of the common services they all require.

We recognize that this would demand considerable collaboration and effort. The services shared in this model, similar to that of the horizontal model, could include information technology (IT) support, human resources, legal services, translation services, and insurance provision.

Another possibility raised was the sharing of services between the national and provincial and territorial levels of a sport. This approach could standardize common practices and requirements within a sport. These services could include, for example, event planning, training and education, membership registration, program development, and policy development.

Vertical amalgamation

Finally, the possibility of vertical amalgamation was raised with the Commission, namely amalgamation between the National Sport Organization with all of its Provincial and Territorial Sport Organizations. However, the Commission heard that the Canada Games create a dependency on the existing provincial and territorial sport organization structure. This is because the Canada Games require provinces and territories to compete separately, with athletes from their respective Provincial and Territorial Sport Organizations; thereby, encouraging the maintenance of the current structure. It was suggested that Canada Games requirement could be changed. As an alternative, a new region-based model was suggested, dividing competitors by areas like the East, West, Central, and North.

The Commission learned of an inspiring Australian example of vertical amalgamation. Cycling Australia, a national administrative body, successfully merged 18 of 19 local and state organizations into a new entity called AusCylcing. The result was a single member-controlled national governing body.^{Footnote 12} This merger led to several efficiencies. A single board of directors with 12 members replaced 18 boards with 130 directors, and a single chief executive officer assumed responsibility for the administration of the new organization.^{Footnote 13} The resulting annual administrative cost savings are estimated at $186,000.^{Footnote 14} Such an approach demonstrates the ability to reduce the number of sport organizations, create efficiencies, and cut costs.

Vertical alignment: preliminary recommendations

The Commission therefore recommends that:

6. The Government of Canada encourage National Sport Organizations to seek broad consistency in the application of their policies across all levels of their sport.
7. The Government of Canada, through incentives, encourage National Sport Organizations to amalgamate with their respective provincial and territorial sport organizations to form a single national organization for each sport, with provincial and territorial branches.
8. The Government of Canada, through incentives, encourage National Sport Organizations to establish and implement a vertical shared services model with their respective Provincial and Territorial Sport Organizations and, where possible, Community Sport Organizations. This model would centralize common services among these organizations, such as information technology (IT) support, human resources, legal services, translation services, insurance provision, and a shared foreign exchange strategy.
9. The Government of Canada create a strategic transformation fund to support National Sport Organizations, and National Parasport Organizations, as they undertake the development of a vertical amalgamation and/or shared services process.