Not long after Peter Aceto joined CannTrust Holdings Inc. as CEO in October, he wrote a column in this newspaper about the rapidly evolving cannabis sector and the adventure awaiting the bold pioneers who decided to follow him. “To be global trailblazers is both motivating and rewarding,” he wrote. “It’s going to be a wild ride.”
Mr. Aceto’s prediction is turning out to be accurate. The banking-turned-cannabis executive, who built his personal brand on trust and transparency, stands at the head of a company accused of using false walls to hide illegally grown cannabis plants. Health Canada issued a non-compliance order to CannTrust for growing thousands of kilograms of cannabis in unlicensed rooms at its greenhouse in Pelham, Ont., between October, 2018, and March. Provincial wholesalers in Ontario and Alberta stopped selling CannTrust products on Thursday, and later that evening the company halted all sales while Health Canada conducts an investigation. Analysts are concerned that CannTrust could lose its growing licence.
“This has not been the best week of my career,” Mr. Aceto said in an interview. His own reputation is at stake, too, although he deflected such concerns. “I was brought in here for a reason,” he said. “The reason was to help professionalize this company and help professionalize this industry.”
That’s shaping up to be the biggest test for Mr. Aceto, who previously spent nearly a decade as chief executive of Tangerine. Over the years, Mr. Aceto has fashioned himself as a thought leader: He toured the speaking circuit and wrote a book outlining his management philosophy titled Weology: How Everybody Wins When We Comes Before Me. According to his personal website, which touts that he has shared the stage with Arianna Huffington and Sir Richard Branson, he has delivered more than 100 keynote talks on topics ranging from innovation to corporate culture and diversity.
Mr. Aceto, a 50-year-old father of three, grew up in Toronto and attended the Crescent School, a storied private school whose mission is to produce “men of character from boys of promise.” He later earned a law degree from the University of Western Ontario and in 1996, he became in-house counsel at ING Direct Canada, an offshoot of Dutch financial-services company ING Groep.
The upstart bank sought to disrupt the finance establishment in Canada by doing away with branches, embracing digital banking and offering no-fee bank accounts with higher interest rates than competitors. Mr. Aceto was integral to the company’s North American development and he helped to build U.S. operations as the chief risk officer and later chief sales and marketing officer. In 2008, he was appointed CEO of the Canadian division.
In keeping with the bank’s image as a disrupter, Mr. Aceto sought to be an untraditional leader. He didn’t think of himself as a banker and he eschewed a cushy office to mingle with employees instead. He got rid of assigned parking spaces, including his own, and was known to respond to customer inquiries directly.
Mr. Aceto dived into learning about the company’s operations, even spending time at a call centre. A year into his leadership, he held a referendum and asked the bank’s 900 or so employees whether they wanted him as their leader. More than 97 per cent voted in favour.
He acted as a brand ambassador of sorts for the bank and was an early and enthusiastic adopter of Twitter. “The behaviour of a small handful of irresponsible leaders over the last two decades has hurt the overall trust level in corporations,” he said in 2010. “That’s why I felt my personal involvement in being transparent would be important for our brand.”
For a CEO, he’s also prolific on Instagram. On Friday, Mr. Aceto even responded to a critical comment on his personal account accusing him of not being transparent with CannTrust investors: “21 years a trusted banker of the people & 9 years the CEO. Then 9 months later a thief/fraud? Ah, doesn’t make sense. Let the dust settle,” Mr. Aceto wrote, according to BNN Bloomberg. The account was then made private. (Before that, he mostly posted about events such as his dog Odie’s birthday party and a concert featuring “the legends, Hall & Oates!”)
In 2012, Mr. Aceto helped lead the Canadian division of ING into the arms of Bank of Nova Scotia, which acquired its competitor for $3.1-billion. By that time, ING had attracted 1.8 million customers and maintained roughly $30-billion in deposits. Mr. Aceto stayed on after the buyout and was involved in rebranding the operations to Tangerine.
He eventually left the company in 2017 and served as an adviser to a handful of startups before taking the job at CannTrust in October. Co-founder Eric Paul heralded Mr. Aceto’s “successful track record of strong leadership, deep operational knowledge and focus on delivering shareholder value” in a news release at the time.
His appointment was seen as a positive development for the nascent cannabis sector, where the quality of management is paramount. He is somewhat of a rarity, a seasoned executive with deep experience in a regulated industry.
Mr. Aceto, who has made talking to employees at all levels of a company part of his leadership style, did not directly answer a question about whether he knew about the illegal growing situation at CannTrust. Instead, he reiterated that a special committee of the board had been formed to conduct an investigation.
“When that work is done, we’ll have a much clearer view of exactly what happened,” he said. “I certainly have been very focused on the task at hand, but I look forward to reflecting on it and figuring out what the learnings are.”