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Fri, 11 Oct 2013 13:45:00 GMT | By Deirdre McMurdy, MSN Money

Paul Desmarais’ remarkable legacy

The death of Desmarais marks the end of an era in business and politics.


Deirdre McMurdy

He has been described as the most influential Canadian in a century — someone who could affect decisions at the highest levels of politics and business not only in his native country, but across Europe and China.

The death of Power Corporation founder Paul Desmarais at 86 marks the end of an era — and the close of a life that was remarkable in many ways.

As a self-made success who was an important international player right up to the end of his life, we are unlikely to see anyone soon assume his mantle. That’s partly a function of changed times: the current generation of CEOs tend to be itinerant soldiers of fortune, trouping from one corporate takeover and restructuring to the next. The average length of tenure today runs 4.6 years.

And business and politics, even in an economy as small as Canada’s, no longer overlap as they once did. Globalization, accountability, transparency requirements, and limits on campaign funding have converged to reinforce the two solitudes of public and private sectors.

Desmarais was famous for his broad network of political and business leaders and his passion for Canadian public policy.

Although he was a Franco-Ontarian from Sudbury and an ardent federalist, Desmarais was respected in Quebec across the political spectrum; his passing this week evoked tributes from sovereigntists as well as federalists.

That was far from a given, in light of his status of many years standing as one of the most passionate and important defenders of a united Canada within Quebec.

While he took great care to keep a low personal profile, Desmarais had a keen eye in the workplace for people whose impact could extend far and wide. Among those who worked either for or with him were former prime ministers Brian Mulroney (who regarded Desmarais as a mentor); Paul Martin; former Quebec Liberal premier Daniel Johnson, former senator and clerk of the Privy Council Michael Pitfield; and John Rae, brother of Bob Rae and Jean Chretien’s longtime and most influential adviser.

And then there is the familial link with Chretien, who has a daughter married to one of Desmarais’ sons. Desmarais also had a close relationship with Pierre Trudeau and his family.

Desmarais’ international contacts were no less impressive. Former French president Nicolas Sarkozy once declared that he won high office “thanks in part to the advice, the friendship and the loyalty of Paul Desmarais.” He awarded Desmarais the rarely-bestowed Grand Cross of the Legion of Honour.

At a party that Desmarais threw some years ago, the guests included former American presidents Bill Clinton and George Bush — as well as Mulroney and former premier Lucien Bouchard, the two one-time friends turned political opponents who would otherwise seldom agree to be in the same room as each other.

Another thing that made Desmarais unusual is that he built and managed a thriving conglomerate, long after that business model ceased to be popular with investors. Over the past few decades, investors have actively favoured “pure plays,” shunning companies with multi-sectoral holdings.

Power Corporation has a significant stake in the financial services sector, including with Great-West Life Assurance, Investors Group, London Life and Canada Life. But it also owns media assets as well as large pieces of Lafarge Cement, Imerys Industrial Minerals and Total Petroleum.

On top of that, Desmarais was one of the first Canadian business leaders to truly expand into international markets. In 1978, a time when European expansion was still considered exotic in Canadian business circles, he was the founding chairman of the Canada China Business Council.

It may have been good for business, but it also helped then-prime minister Pierre Trudeau open diplomatic relations with China. Years later, Desmarais played a crucial role when Canada, under the new government of Chretien, recognized China’s growing economic power and decided to make overtures aimed at enhancing trade.

While the growth of Power Corporation was the stuff of entrepreneurial legend, Desmarais was also renowned for using his $4.5 billion personal fortune for philanthropic ends. That includes university and medical buildings across Quebec and elsewhere that today bear the family name, as well as countless other contributions that are less publicized — but no less important.

All this from his decision to pay $1 to buy a bankrupt bus company in Sudbury, Ont., and bet that he could make it not only survive, but thrive. He did, and that meant good things not only for the company, but the community it served — a trend he continued on an ever-increasing scale, all of his life.

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