Power

Globe Investor Magazine, November 18, 2008

Jim Leech

TITLE: President and CEO, Ontario Teachers' Pension Plan, Toronto

VITALS: Born in St. Boniface, Manitoba, Leech has a B.Sc. in mathematics (Royal Military College of Canada) and an MBA (Queen's University). He is married with three children. Leech is 61.

WHAT HE CONTROLS: With $108.5 billion in assets as of last December, OTPP manages money for 278,000 working and retired teachers.

SHOW OF POWER: Leech's military background makes him an efficient, disciplined general of the second-largest pension fund in the country. Leadership and foresight have made Teachers the envy of most pension funds in the country.

PERFORMANCE: Between 1990 and 2007, OTPP's average annual return was 11.4%, versus 8.5% for the indexes it uses as benchmarks.

WHAT'S NEXT: When Jim Leech took charge of Canada's second-largest pension plan last winter, he also got the keys to what could be the biggest leveraged buyout ever. OTPP's long-awaited $35-billion takeover of BCE hasn't gone smoothly for Leech. After surviving a Supreme Court challenge, the deal may now fall victim to the global credit crunch before its December deadline.

Leech has stayed calm throughout this ordeal, and is equally cool-headed about the broader challenges facing his organization. Within a decade, OTPP will have just one working contributor for every retiree. But it recently erased a projected $12.7-billion shortfall, mostly by moving to end guaranteed cost-of-living increases.As forthe current financial crisis, Leech says OTPP-which returned a modest 4.5% last year-is a long-term investor with a relatively conservative asset mix. The fund also has the means to keep paying benefits during trying times,he explains."Wecan ride out peaks and valleys without putting people's security in jeopardy." -Nick Rockel

Jeffrey Orr

TITLE: President and CEO, Power Financial Corp., Montreal

VITALS: Born in Montreal, he holds a BA in business administration.The 49-yearold is married with three children.

WHAT HE CONTROLS: Power Financial controls IGM Financial ($119 billion in assets under management at June 30. IGM Financial controls Investors Group and Mackenzie Financial, and Great-West Lifeco ($393 billion in assets under administration at June 30, including $172.3 billion in mutual funds).

SHOW OF POWER: Orr talks softly and carries a very big stick. He is a disciplined, long-term planner, and has the full support of the Desmarais family,which gives him near-unparalleled clout in this country. Helped lead the gutsy and as yet unproven bet to buy and turn around Putnam Investments.

PERFORMANCE: Shares of Power Financial are off 17% for the year ended Sept. 30, but the average annual return is 11.7% over five years.

WHAT'S NEXT: Power Financial's $3.9-billion (U.S.) acquisition of Boston-based Putnam Investments last year is the first major foray by a Canadian firm into the U.S. mutual fund business. Orr calls Putnam a jewel, but admits it will take time to turn around the struggling fund giant. It has suffered net redemptions in recent years, and was forced to close down a $12-billion money market fund in September as jittery institutional clients pulled out cash in the wake of the financial crisis. By Sept. 30, its assets had fallen to $137 billion (U.S.).

In Canada, IGM's Mackenzie Financial subsidiary closed a deal this fall to buy Saxon Financial Inc. for $287 million. While RBC Asset Management eclipsed IGM this year as Canada's biggest fund company, Orr shrugs it off. Counting only the long-term stock and bond funds, which earn higher fees than money market funds, "IGM is very much still the largest player," he says. -Shirley Won

Len Racioppo

TITLE: President and director, Jarislowsky Fraser Ltd., Montreal

VITALS: A BA in economics and commerce, and an MBA from U of T.

SHOW OF POWER: Len Racioppo runs the Jarislowsky empire while its founder enjoys the spoils of semi-retirement. Racioppo is the kingmaker on almost every Canadian takeover, and every investment banker or CEO who wants to get a deal done knows it.That's because Jarislowsky Fraser owns so much stock in Canadian companies that few takeovers can get done without Racioppo's approval.

PERFORMANCE: Jarislowsky Fraser's $5.5 billion Canadian Equity Fund has a 10 year return of 16.9%. As of August,it was up 2% on the year.

WHAT'S NEXT: He never rants or pounds his fist on the table, demanding a higher price. Instead, he does his homework, comes up with the price he believes is fair, and never moves from it. As large consolidators prey upon smaller companies during the market meltdown, they're going to have to try to get through Len first. - Andrew Willis

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