Home / Business / A CEO, but not exactly a Bay Street guy: Bill Morneau’s path to becoming Canada’s finance minister
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A CEO, but not exactly a Bay Street guy: Bill Morneau’s path to becoming Canada’s finance minister

TORONTO • In their 2013 book The Real Retirement, authors Bill Morneau and Fred Vettese muse about changes in our view of what it means to be poor.

“One of the authors of this book,” they write, “was raised in Toronto and enjoyed a happy and healthy childhood. There is little doubt, however, that his family’s living standard, which seemed average to him at the time, would border on poor by today’s standard. They included seven family members (plus boarders from time to time) residing in a 1,200-square-foot house … owning one baseball glove … sharing one black-and-white TV set with the rest of the household, wearing hand me down clothing, and recalling no more than five visits to restaurants in total until his teen years.”

The boy described in this passage is not Bill Morneau, but rather his co-author and then-employee, Vettese.

Morneau, the rookie Liberal MP for Toronto Centre, who rocketed to celebrity this week when Prime Minister Justin Trudeau named him as minister of finance, had a more exclusive upbringing. His father, Frank Morneau, had founded the actuarial and benefit consulting firm W.F. Morneau & Associates in 1966, four years after Morneau was born, and by 1985 had grown the firm to annual revenue of $5-million.

He is not exactly a Bay Street guy

Bill, who has four sisters, graduated from the private Greenwood College School in tony north Toronto; after the University of Western Ontario, he studied at the London School of Economics and at the Institut européen d’administration des affaires, or INSEAD; he lived at the time on the Rue de la Fromagerie in Chailly-en-Bière, in north-central France.

Morneau was not much of a party animal, by his own account.

“The biggest culture shock came in one of my first jobs,” he writes in the INSEAD Canadian alumni newsletter. “At Lloyd’s of London in the mid 1980s, people (or at least the ones I worked with) still drank at lunch. I found myself having a pint at lunch, which made the afternoons less productive. Happily, this is no longer part of my work life!”

By the looks of his CV and in the views of the half-dozen people to whom the National Post spoke for this profile, if there is one thing Morneau, 53, cannot stand, it is being unproductive.

His father may have handed him the reigns; much of the wealth the son now enjoys — such as the home he and his wife, Nancy McCain of the McCain french-fry fortune, now own in Oppède in the Provence region of southern France — came after hard work. From business to think-tanks to philanthropy to his regular runs through the streets of north Toronto, sometimes accompanied by one of his four children, Morneau seems unable to stop moving.

The new position may suit his style. Finance minister, as a job, “is a bit of drinking out of the firehose,” admits Jim Leech, chancellor of Queen’s University, who came to know Morneau when Leech ran the Ontario Teachers’ Pension Plan and Morneau was chief executive of what is now Morneau Shepell. “But as a CEO it’s not unusual to step into new sets of circumstances. He is very fit. He’s got a spring in his step.”

* * *

Morneau Shepell’s head office fills two eight-storey poured-concrete office buildings in a sedate office park fronted by majestic weeping willows in Don Mills, northeast of downtown Toronto. The firm now employs about 4,000 people across North America, including 150 actuaries. Bill Morneau resigned last week as executive chairman of the firm. Morneau Shepell, and Morneau himself, declined requests for interviews for this story.

Peter Kuitenbrouwer/National Post

Morneau Shepell’s people look after the pension plans of workers in the public and private sectors and advise companies on whether they have put aside enough cash to pay their pensioners. In the years when Bill Morneau ran the firm, the company swallowed competitors across Canada as it grew to become the nation’s biggest player in that sector. Global firms such as Mercer and Towers Watson are powerful competitors, but Morneau Shepell has held its own.

“He’s had ferocious competition from those large actuarial firms, and he has survived very well,” Leech says.

He made at least one enemy along the way: Warren Shepell, the man whose name now graces Morneau Shepell.

Sheppel in 1979 founded a firm to provide companies with help giving mental health and emotional counselling to employees. In 2005 Shepell sold that company, Shepell EAP, which had 1,500 employees, to Clairvest. Three years later, Morneau’s firm bought Shepell, and changed its own name to Morneau Shepell.

Warren Shepell says he objected to the use of his name, and successfully had the government of Ontario send Morneau a 2001 letter saying that “under the business corporations act, written consent must be obtained to use the name of an individual.”

“I sold the company and the list of clients, but I didn’t really sell the name Shepell,” says Shepell. “We met and I said, ‘Since you want to keep using Shepell, why don’t I become associated with the company?’ ” Shepell says, speaking from the Caribbean island of St. Maarten. “But he said no. I found him to be very cold.”

More flattering is David Denison, the chair of Hydro One: “Morneau has an effective personal style, he listens, he is open to ideas, and he is prepared to be decisive.”

CHRIS WATTIE/AFP/Getty Images

He compared Morneau to Michael Wilson, who worked at Royal Bank before he became finance minister in 1994. “There aren’t that many very successful senior executives willing to run for Parliament and serve in that capacity.”

The suburban headquarters of Morneau Shepell helps to situate Morneau. He is not exactly a Bay Street guy. This stands in contrast to his predecessor, Joe Oliver; Oliver spent his life as an investment banker on Bay Street, and Oliver’s photo hangs on the wall of the Cambridge Club, the men-only athletic club.

Clive Caldwell, who owns the Cambridge Club, says “I’ve never heard of him.”

David Dodge, former chairman of the Bank of Canada, says it’s unsurprising if Bay Street power brokers don’t know Morneau.

“Bill ran a company,” says Dodge. “He wasn’t Bay Street. Joe was on Bay Street. Compared to the last finance minister, this is a big step up. Bill is more capable.”

When I saw his name, I thought, ‘This is a fantastic choice’

Others disagree. In an article on the leftist rabble.ca web site Thursday, Daniel James Wright referred to a column Vettese wrote last year in the Financial Post: “Even the rich can qualify for the Guaranteed Income Supplement.” Wright suggested that, since Vetesse worked for Morneau when the article came out, the men share similar views.

“For all the heady rush of generational change and sunny, progressive ideals, it’s the same old corporate elite in charge of the financial decision-making for another four years,” Wright writes.

These kinds of snide attacks are only the beginning of the abuse that Morneau will have to withstand.

“He is going to have to learn how to deal with Parliament and with the press,” says Dodge, who had to learn those skills himself. “He’s got an outgoing personality so I think he will do just fine.”

Twitter

That outgoing personality is on display on Morneau’s Twitter feed from the election campaign, a parade of selfies and photographs of people in red t-shirts, as Morneau presses the flesh with Tamils, gays and lesbians, Jewish and Muslim leaders, and shares his morning run with the Ontario premier, Kathleen Wynne. Other photos show Morneau and McCain with Henry, Clare and Edward, their three children, and Grace Acan, a Grade 9 student they sponsored to come to Canada from northern Uganda. Elsewhere, Morneau notes that his sons cheer for the Montreal Canadiens, whereas “I still hope for the Toronto Maple Leafs to do something in my lifetime.”

“Bill is a very nice person,” says Claude Lamoureux, who served with Morneau on the board of St. Michael’s Hospital in Toronto. “Bill is able to handle prima donnas. He doesn’t have a big ego. When I saw his name, I thought, ‘This is a fantastic choice.’ ”

Morneau will face challenges at finance, Lamoureux warns: “When you are finance minister, people watch you every day. The job of finance minister is very easy when the finance minister and the prime minister agree on what has to be done.”

Whether the two will always agree is an open question. Trudeau in the campaign promised to help the middle class; Morneau in his book predicts that “the federal government will cut back on its pension programs to reduce or eliminate early retirement benefits.”

Elsewhere Morneau writes that, “We can expect that government will force Canadians to assume more responsibility for certain health care costs.” Morneau’s predictions may make economic sense but prove harder to implement politically, particularly for these Liberals.

This week, Morneau appears to already have begun to adjust his views to suit his new job. In The Real Retirement, he had written that “Canadians are actually doing better than they think they are in their retirement planning — and are better off than many of the experts are telling us.” But on the day he took the oath as Canada’s new finance minister, he said something quite different on CBC Television.

“Canadians aren’t saving enough to have a secure retirement,” Morneau said. “We’re not going to have a plan tomorrow, but we are going to start thinking about what the right way to approach it is tomorrow.”

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