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the lunch

Illustration of Monique Leroux, president and chief executive officer of Desjardins Group.ANTHONY JENKINS/The Globe and Mail

From the dining room at the top of the South Tower of Complexe Desjardins, Monique Leroux peers out the window and laments the clouds rolling in. "With the blue sky, you can see the St. Lawrence River shining under the sun," she says. "I like very much the view."

It's no wonder. Ms . Leroux, president of Desjardins Group, is surveying the edge of the Montreal's financial centre in the province that gave birth to North America's first credit union 112 years ago – a province shaped by her institution's $190.1-billion in overall assets, with $401-million returned to members and the community in the past year. As the largest private employer in Quebec, Ms. Leroux has about 45,000 employees under her wing.

But the impressive view comes at a price. As Ms. Leroux settles into her chair at the linen-covered lunch table, her back to the expansive windows, she shifts her focus to Desjardins' future in an increasingly competitive landscape. Canada's sixth-largest deposit-taking institution, a co-operative with 5.6 million members, is intent on slow and steady growth, but it is not immune to such pressures as a low-interest-rate environment and ferocious lending competition.

So the Montreal-born, 58-year-old is casting her gaze across the country and around the world. With deals such as the $443-million acquisition of High River, Alta.-based Western Financial Group at the end of 2010, and an agreement with France-based mutual savings bank Crédit Mutuel, the company has signalled its intention to grow outside Quebec – an ambition Ms. Leroux must balance with the aim of protecting a membership base the company has spent years slowly cultivating.

"We want to continue to expand, slowly but surely, our presence across the country. We want to do it in a way that will be sometimes opportunistic … ," she says. "If we can be there to support our development in a working partnership, we will be there."

But growth is not without its risks, and that is particularly true on Desjardins' home front, where competition is growing at a rapid pace. Rivals such as National Bank of Canada are already nipping at its heels in the province, and would undoubtedly seize any opportunity to gain market share.

"We are very, very comfortable with the Quebec market," Louis Vachon, the CEO of National Bank, said on the bank's second-quarter conference call. He went on to add that his bank is "clearly gaining market share versus our main competitor in both retail and commercial market segments."

And while Desjardins' gradual pace of growth appears to be well-suited to gentle partnerships abroad, missteps would be embarrassing. Ms. Leroux argues the group's co-operative business model protects it against risk, and is attractive because of its alignment with social responsibility and sustainable development.

With members, rather than shareholders, the co-operative model also allows Desjardins the luxury of a little more time. "Again, the purpose is not growth for the sake of growth, or to drive up the share price; it's to provide the long-term benefit for members," she says.

As if that weren't enough on one person's plate, Ms. Leroux is determined to convince the world her business model is one for the future.

Without a ticker on the Toronto Stock Exchange, non-Quebeckers sometimes need a little prodding to recognize Desjardins Group's success. And since the company is a complex web of financial service caisses – people's banks – and credit unions comprised of many auxiliary insurance companies, brokerages and asset management teams, its model works differently than the average bank or insurance company. The members who use Desjardins' broad range of services get a portion of the profits returned to them.

"Co-operatives are not well known to the general public, the media and the government most of the time," she says between nibbles of sprout-topped tuna tartare on a rice disc. But that does not mean the companies themselves are not household names. Sunkist Growers Inc., the citrus growers group and the National Football League team Green Bay Packers are just two examples of brands with a co-operative business model.

"In Quebec, just to give you an idea, we have more than 3,300 co-operatives. And if you combine the revenues of the top 300 in the world, it's more than the GDP of Canada," she says.

Ms. Leroux has a lot more freedom to explore deals than when the financial crisis struck in late 2007. Chief financial officer at the time, she took on a tough-love approach to steer the group away from the risky investments such as asset-backed commercial paper and toward dividend cuts to shore up capital.

"In 2008, when we were in the financial crisis and it was so rough for everybody, I was not able to manage by just providing ideas and the conditions for people to develop themselves," she says, curling her finger around a string of dazzling oversized pearls.

During that time, she dived into the details, spending countless hours in huddles with employees, talking out strategies and combing through the numbers. She put her background as a chartered accountant to use.

Having surfaced from the crisis, Ms. Leroux sees her role as that of an idea generator who can allow employees to explore and grow. "The philosophy here is not to maximize the return on equity, it's to maximize our capital and have some good stability of the earnings – we don't want to have too much volatility," she says.

To communicate that philosophy, Ms. Leroux will soon thrust Desjardins onto the world stage. She has planned the first International Summit of Co-operatives – an event she conceived to show the world that co-operatives can close the gap between businesses and people – between profit and community. Now, with that Quebec City summit only days away, Desjardins is ready to show the international leaders just what they can expect from the sixth-largest co-operative financial firm in the world.

Between sips of frothy cappuccino to end the meal, Ms. Leroux expresses hope that the first International Summit of Co-operatives is just the beginning. But it won't be the studies, seats sold or reviews that encourage her to plan another event.

"It has to be not just good, but emotionally positive – there has to be a taste to come back," she says. "We need to feel that we have that energy, that creative urge, and then we will do it."



Born in Montreal, Monique Leroux grew up in the suburb of Boucherville.


Ms. Leroux lives in Montreal with her husband, Marc, and 16-year-old daughter, Anne-Sophie.


Joined Desjardins Group in 2001 as president of Desjardins Financial Corp. and CEO of its insurance, trusts and brokerage subsidiaries.

Named chief financial officer of Desjardins Group in 2004.

Appointed chairwoman and CEO in 2008.


After finding text handwritten by the company's founder in 1893, she published her own short book called Alphonse Desjardins: A Vision for Today's World, Quotations on the Amazing Power of Co-operatives .

Involved with about a dozen boards and organizations, including the International Confederation of Popular Banks and Conference Board of Canada.


"I would say: 'Oser, essayer, c'est le debut de réussir.' That is: 'To dare, to try, it's the beginning of success.'"

Editor's Note: Desjardins Group is headquartered in Levis, Que., and the first International Summit of Co-operatives is in Quebec City. Incorrect information in an earlier version of this story has been corrected.

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