Rod McQueen's Manulife: How Dominic D'Alessandro Built a Global Giant and Fought to Save It was one of five books nominated for Canada's 2010 National Business Book Award. The award was established in 1985 to recognize the outstanding talent in Canadian business writing. The $20,000 prize is sponsored by PricewaterhouseCoopers, BMO Financial Group and media partner The Globe and Mai. Jeff Rubin's Why Your World is About to Get a Whole Lot Smaller: Oil and the End of Globalization won the award on June 9.
Rod McQueen is a journalist and business writer. Read an excerpt and listen to a reading from his book below.
Excerpted from Manulife by Rod McQueen. Copyright Carslae Strategic Communications Inc., 2009. Reprinted with Permission of Penguin Group (Canada).
Dominic D'Alessandro moved to the microphone and peered out at the black-tie crowd as if assessing their mood or how much wine they had consumed. Would his opening joke still work? Why not? This event on October 29, 2008, at the Four Seasons Hotel in Toronto was, after all, a dinner in his honour. He had been chosen months earlier to receive the Ivey Business Leader Award given by the Richard Ivey School of Business at the University of Western Ontario. The five hundred alumni were in a convivial mood after enjoying beef tenderloin and Mission Hill Estate wines from the Okanagan Valley at the event that raised $317,000 for student scholarships. In return the attendees were looking to learn leadership secrets from the pugnacious D'Alessandro who, since his 1994 appointment as chief executive officer of Manulife Financial , had taken a sleepy company and created the largest life insurance company in North America and the third largest in the world after AXA of France and Assic Generali of Italy.
Until the very month of the Ivey event, Manulife had avoided the global chaos of collapsing markets that caused once-proud companies to go bankrupt or need government backstopping. That's because D'Alessandro had wisely kept Manulife away from subprime mortgages as well as all those synthetic derivatives that wreaked havoc on so many other firms. Prudence, however, could only protect a corporation for so long. In October the financial version of the bubonic plague infected even the healthiest corporate citizens. Manulife share price fell 46 percent in that one month.
As a result, D'Alessandro's personal fortune suffered an unholy hit. At the beginning of October, D'Alessandro held shares and options in Manulife worth $188 million. As he stood before the Ivey crowd, most of the options, which four weeks earlier had accounted for half of that substantial sum, were worth absolutely nothing. The rest of the holdings had also shrivelled; the $188 million had become $50 million. All those bonuses deferred, all those years of taking salary in shares because he believed in what he was doing, all that Herculean effort-and for what?
Little wonder D'Alessandro began his remarks on the anniversary of Black Tuesday, October 29, 1929, somewhat defensively. "I will confess to being very apprehensive about having to speak to you tonight about the important subject of leadership. It's a subject that has been covered so many times by so many other, far more capable, speakers," he said. "In fact, I feel a little like Elizabeth Taylor's seventh husband must have felt on their wedding night. I know what to do, but how do I make it interesting?"
D'Alessandro went on to say that leadership was all about bold vision, self-confidence, the ability to persuade others to pursue an objective, and most of all, integrity. But the lesions of the present tempered the lessons of the past. "The irony of speaking to you tonight about leadership and integrity, given the tumultuous developments in global financial markets, is not lost on me. Every day brings new revelations that these qualities, sadly for everyone, were too often absent in many parts of the financial services industry," he said. "It is simply unbelievable what has happened. Who would have thought a few months ago that we would witness the nationalization or forced sale of major portions of the banking industry in Europe, the United States, and elsewhere? That investment banking, as we know it, would virtually disappear? That AIG once the world's largest financial institution, would be on life support almost certainly never to regain anything remotely like its former stature?" Who indeed? Not Dominic D'Alessandro. Not anyone.
Read excerpts from all of this year's National Business Book Award nominees: