Why does setting CLICOLOR=1 not turn on colors for "ls"?
A few issues.

Homebrew coreutils ls is not the OSX/freebsd ls. Coreutils is GNU, and that ls uses --colors instead of -G. -G in gnu ls means do not show groups. It does not use CLICOLOR either. There is no environmental variable to set colors for gnu ls.

OSX's ls uses -G as a command line option, in the same way that exporting CLICOLOR would as an environmental variable.

So you are using the wrong variable for the wrong command.