John Edward Cleghorn
John Edward Cleghorn, banker and philanthropist (b at Montréal 7 July 1941). A university football player, he studied commerce and history, graduating from McGill University with a Bachelor of Commerce degree in 1962. In 1963 he married Pattie Hart; they have three children and several grandchildren. Though drafted by the Toronto Argonauts after university, Cleghorn chose instead to go to work for the accounting firm Clarkson Gordon (now Ernst & Young) in Montréal. In 1964, fulfilling an ambition nurtured since grade 10, he became a chartered accountant.
After Clarkson Gordon, Cleghorn moved to St Lawrence Sugar, but left soon afterwards to take up a position as account manager with the Mercantile Bank, becoming their Western regional vice-president within 10 years. Cleghorn rose steadily up the ranks of the banking world to its top position.
In 1974 he joined the project-financing department of the ROYAL BANK, and by 1983 was their executive vice-president of international banking. In 1986 he was named president, and in 1990, chief operating officer, spearheading the $1.6-billion acquisition of Royal Trustco. In 1994 he was named chief executive officer and a year later became chairman and CEO.
The bank over which Cleghorn assumed control was the largest and most profitable in Canada, with assets of $184 billion and over 10 million customers. In 1994 it earned almost $1.2 billion in profits. Cleghorn immediately began to imprint his low-key personal style by selling off the Royal's Challenger luxury jet and implementing other cost-saving measures.
In 1997, although the Royal reported profits of $1.68 billion, Cleghorn began to lay the groundwork for the first Canadian bank merger since the 1950s. On 19 Dec 1997 he took what has been called "the most famous stroll in the annals of Canadian banking" to the headquarters of the BANK OF MONTREAL, where he proposed to its chairman Matthew Barrett the merging of their respective institutions. The resulting financial enterprise would control assets of over $453 billion, and would stand 10th in North America and 22nd in the world in market capitalization. Barrett agreed. Cleghorn was confident that the finance department and Competition Bureau would approve the deal.
Cleghorn and Barrett launched their audacious initiative in January 1998 without waiting for a host of major governmental studies on the financial services sector, including those of a federal task force, to publish their conclusions. In the ensuing months the Toronto Dominion and Canadian Imperial Bank of Commerce also proposed to merge. By December 1998, when finance minister Paul MARTIN announced that both deals would be rejected, polls revealed that more than two-thirds of Canadians strongly opposed them.
Over the next two years, Cleghorn's stewardship of the bank was financially successful but not consistently calm. Between 1998 and 2001, the Royal spent over $5 billion on various US acquisitions in retail banking, insurance and securities brokerage. In February 2000 the bank announced profits of $3.5 billion, but Cleghorn was subsequently criticized for plans to cut some 6000 employees. In July 2000 he published an open letter in Canadian newspapers apologizing for the activities of some employees of Royal's pension fund, RT Capital Management Inc, who were charged by the Ontario Securities Commission with manipulating stock prices. In July 2001, at the age of 60, he retired from the Royal Bank. Guy Saint-Pierre, Royal Bank's Chairman of the Board, said in the 2001 annual report: "John Cleghorn's legacy to the organization includes unprecedented financial performance, the solid foundation of a US expansion strategy, and the assembly of an outstanding senior management team." Cleghorn now serves as chairman of the board of SNC-Lavalin group and as a director of Canadian Pacific Railway, Finning International, Molson and Nortel Networks.
While known by most Canadians as a banker, Cleghorn is also a well-regarded philanthropist and successful fundraiser. He was chancellor of Wilfrid Laurier University from 1996 to 2003, during which time he and his wife established several funds at the university, including Canadian European Battlefield Fellowships. In the mid-1990s he led the McGill Capital Campaign and he and his wife established the Pattie Cleghorn Fund in Diabetes Research at the Polypeptide Hormone Laboratory at McGill. Cleghorn has used his extensive business talents to benefit a wide range of charities and non-profit organizations as Honorary Governor of the Shaw Festival Theatre, Director of the Canadian Special Olympics Foundation and Chairman of the National Gallery Foundation of Canada. In 2001, pursuing his interest in history, he became Chairman of the Board of Directors of the Historica Foundation, a position he held until 2003.
Cleghorn was made an Officer of the Order of Canada on 31 May 2001.