Live & Learn: Claude Lamoureux

The 17-year veteran of OTPP talks of governance, risk and the tax game.

I didn’t see myself running a pension fund. They didn’t seem to me to be all that dynamic.

I wanted to be an engineer or a business person. There was an actuary who would teach math at my séminaire part-time. I was intrigued by what this guy did. I discovered it’s like being an engineer, but for an insurance company.

I haven’t done too many risky things in my life. Whitewater rafting down a river, that’s it. But there you can control the risk. I had an uncle who was a farmer. He had no kids, so my brother and I would go and help. On a farm, when you’re six, you do everything. Even drive the tractor. My cousin and I essentially once drove the tractor into the general store owned by my other uncle. The only thing he said was, “Claude, you should have been driving.” My cousin didn’t know how. He came from the city. The tractor was unusable for a month.

I lived in New York for 12 years. People go there not just to get a job. People go there to be the best at what they do. My area of expertise became taxes. You discover that tax is like a game. You have to find loopholes. When the civil servants discover what you’ve done, they patch that hole. The trick is to find new ways of saving money.

The main thing I wanted to do with Teachers’ was run it like a business. I found out pretty early on that we were slow to respond to correspondence and all kinds of things. If you wrote to us, you would get an answer in about six months. From that point on, we really modernized the system.

I remember we were buying real estate in the early days. By the end of the year, we had to write down our equity 40%, because the price of real estate was coming down. It’s certainly not pleasant explaining that to your board. But if you’re convinced the time is right to buy, you have to make the case.

From Day 1, I felt I worked for the board. If I don’t do a good job, they let me go.

Michael Wilson, David Beatty, Stephen Jarislowsky and myself. That group met with a number of companies, and we would make our point of view known. Sometimes, the discussions would get heated, but at least they heard what we had to say.

I don’t think I was a lone voice on governance. We were just more vocal than other people, because we were a very large fund. We’ve voted on occasion for things that appear to break good governance rules. Why? Because we think they will help performance. In business, there are deadlines. In politics, time is totally irrelevant.

I’ve been a director at the Canadian Investor Protection Fund, where you see the end results of people who have been either greedy or ignorant. They’ve made investments where you just go, “You did what?” They’ve lost all their money. These are things that make you want to cry.

I give books to the employees to read. To me, any book by Peter Drucker is worth reading if you want to go into business. If you want planning and the economy, read Michael Porter. You name the topic, and I can give you books.

Everyone should read the Harvard Business Review. I have a 40-year collection at home that we’ve moved around a number times to the great dismay of my wife. I started subscribing in 1966, when I got out of school.

You can look at a task and see the whole thing, or you can take it one piece at a time. That’s one thing I’ve learned in business. If you’re given a task, don’t try to do it all at once.

I want people to have five objectives. I don’t want more than five. I can remember five things. I can’t remember 20.

Earns a B.A. from the Université de Montréal, and then an actuarial science degree from Laval three years later.

Begins career with Metropolitan Life in New York. Becomes head of Canadian operations 20 years later in 1986.

Accepts CEO position with Ontario Teachers’ Pension Plan and helps form its investment arm, which has $19 billion in assets.

Forms the Canadian Coalition for Good Governance along with investing guru Stephen Jarislowsky and others.

Announces he will retire on Dec. 1, after building Teachers’ assets to $106 billion during his 17-year tenure.