Q&A with Dominic D’Alessandro: the former CEO of Manulife tell us how to turn Toronto into a global financial capital
What have you been up to since you left Manulife a year ago?
I sit on a number of boards, so I’m as busy as I want to be. I’ve also been playing golf. I just got back from Pebble Beach.
How did you play?
I started off really terrific, then I reverted to form. I’ve got a double-digit handicap.
You’ve also been involved with launching a think-tank called the Global Risk Institute. How did it come about?
Canada emerged from the financial meltdown in far better shape than other countries. We should be proud of that. The GRI will build on our reputation as a good risk manager and lend gravitas to Toronto as a financial capital. People quote stuff that comes out of Brussels and Geneva and New York. We’d like them to reflect on findings that come out of Toronto.
What’s your role in making that happen?
My job was to gather the 15 or so CEOs from the country’s largest financial companies around the table and cajole them into participating. It was very easy.
How will the institute work?
It will be run by a small group that will oversee the distribution of funds to different universities, where there will be chairs in the study of particular risks, like equity or interest rate risks, for example.
How can Toronto’s financial institutions strike a balance between conservatism and innovation?
Innovations can have lethal side effects—like mortgage-backed securities and derivatives, for instance. Let’s have innovation, but let’s test it. We have food and drug testing; we need the same for new financial tools. That’s where the GRI comes in. We’ll make sure the quality of the research on new tools is good.
What are the chances of Toronto becoming a global financial powerhouse?
The goal is to make Toronto the second strongest financial centre on the continent. We can’t overtake New York, but there’s no reason we can’t be second.
Do you think Wall Street will be receptive to the institute’s work?
It’s hard to know if they’re paying attention. It’s still an unbelievable mess down there. I find it very distressing. You have an extremely educated populace, with the freest of presses and all the information you could possibly imagine, and yet things are still being driven by misinformation, from the cacophony of opinions on 500 TV channels.
Well, we know there’s a lot of frustration in the U.S. about Wall Street’s recovery and the fact that it’s not trickling down to the average consumer or translating into more jobs. When do you think the U.S. will see positive change?
A lot of the unease is driven by the political situation. Americans have lost confidence in their leadership, and the biggest obstacle to restructuring the economy right now is this malaise. It’s damaging to your self-esteem to go from head of the class to, well, where America is today.
Is Obama to blame?
I’m not giving up on him. He tells truths—he tells people they can’t work less than everybody and pay less taxes than everybody and consume more energy than everybody without consequences.
Do you think Wall Street has learned a lesson? Will it change?
The vast majority of bankers understand that it can’t be business as usual.
After the meltdown, you blamed greedy business leaders and the lack of oversight. Do you still feel that way?
Absolutely. I come from a humble background, and it’s infuriating to see rewards so disproportionately distributed. These Wall Street banker types have had too much influence and had their way with the regulatory process for too long.
So maybe foreign institutions will listen to Toronto over Wall Street.