Part 25 (1/2)
*A prominent member of a well-established Winnipeg grain family, Searle stayed on the Committee for fifteen years, but when he developed the habit of spending every winter in Florida, and thus missing an increasing number of meetings, he was not invited to stand for re-election.
t Chester was so relaxed that he even took on an outside directors.h.i.+p (his only one), naturally choosing the Great-West Life a.s.surance Company.
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as every other Winnipeg Committeeman (he was president of Monarch Life and a director of Beaver Lumber), Woods was an original. He was the ultimate insider, so trusted by Manitoba's political and economic 61ite that for a brief time he was chief bagman for both the provincial Liberal and Conservative parties at one and the same time. He took on the HBC Chairmans.h.i.+p determined to move the Company's head office to its proper address, on Winnipeg's Main Street, and though he didn't succeed, he put in place most of the necessary groundwork. Prompted by Chester, he also reactivated the Hudson's Bay Oil & Gas operation. By the spring of 1943, the firm owned a dozen wells in Turner Valley, representing 10 percent of the field's production. Within the decade, the HBC had invested $8 million in exploration and HBOG had become the second-largest holder of known gas reserves (4.3 million acres) in Alberta, with eighty producing wells. A major exploration agreement was signed with Continental Oil, to expire June 30, 1951. That proved to be a bonanza because Continental at about this time named as its president L.E McCollum, one of the great Texas oil- men, who invested $300 million in land acquisition and oil exploration in the next two decades.
A continuing controversy of the 1950s concerned the desirability of moving retail operations into Ontario and Quebec and whether or not the HBC should join other department stores in establis.h.i.+ng satellite branches in suburban shopping centres. Chester's position, strongly supported by Elmer Woods, was nothing if not clear: he would never ”go whoring in the East,” and there was no point going into shopping centres because sales in such urban fringes would only reduce the core business of the Bay's magnificent downtown department stores. ”If there were fuddy-duddies in the TRANS-ATLANTIC BLOOD FEUD 417.
Company, they were to be found in Canada rather than London,” claimed Joe Links. ”Chester was instinctively opposed to buying other companies, believing the HBC could perfectly well build up any business it wanted and 'crucify' its compet.i.tors. Above all, Chester wanted the HBC to stay in the West-certainly to make itself compet.i.tive, to enlarge its big downtown stores, to build parkades, and open up new stores in unexploited areas, but not to challenge 'those wh.o.r.es in the East,' where an honest trader with Western Canadian principles would only get his fingers burnt. We in London felt the shopping centre movement gave HBC opportunities with its expertise in operating retail stores of widely differing sizes. Chester's argument that anything that might weaken our downtown stores must weaken the Company was an interesting reversal of a situation that arose in the HBCs pioneering (lays. When the French took to opening trading posts upriver in order to catch the Indians before they reached the HBC posts with their furs, the Bay men on the spot sought authority from London to go still farther upriver.
But London foresaw a limitless leap-frogging and decided instead that better prices for furs and better trade goods would do more for the Company's reputation. I once reminded Chester of this story and saw him momentarily waver. If what he was saying had been said by those London b.a.s.t.a.r.ds of the eighteenth century, then perhaps he might be wrong after all. But he was comforted by the thought that twentieth-century London didn't agree with him: this confirmed that fie must be right.” Peter Wood, the HBC's Treasurer, verified this: ”If the London people had been overtly against the suburban stores, Chester would have been vehemently for them.”
It was a costly dispute. Sears in the United States had opened its first suburban store at Aurora, a Chicago 418 MERCHANT PRINCES.
suburb, in 1928, and by the early 1950s shopping centres with department stores at each end were sprouting up all over America. Woodward's opened Canada's first shopping-centre store at West Vancouver's Park Royal in 1950 after the HBC had turned down an offer from the Guinness family, the centre's developers, to be the anchor store. Four years later Canada's initial double department store plaza was launched in a suburb of Hamilton, with Morgan's and Simpsons-Sears as anchor tenants. Eaton's put its first branch into Oshawa in 1956. George Weightnian, a thirty-year Bay man who eventually became manager of market research, still laments the lost opportunities. ”I wrote a long pr6cis summing up the prospects for the Company and made a convincing argument, but when I finished my presentation, Chester just said, 'Young man, you can't see the woods for the trees,' and I thought to myself, 'Well, there you are.”' Part of the problem was that Chester was an atrocious driver, seldom drove his car and was not aware of the effect of people's new mobility on North American cities.
BY THE EARLY 1950s, Sir Patrick Ashley Cooper, now nearing his sixty-fifth birthday, began to send out feelers about having his term as Governor extended beyond normal retirement. He had a good case and made certain that it was promulgated in the Company's 1951 report. Share values, he reminded the proprietors, had fallen from 131s 3d in 1928 to 22s 6d in 1930, but since 1932 the Company had distributed Y,3 million in dividends and ploughed 98.5 million back into its treasury, raising a.s.sets from Y,10.7 million to Y,66.8 million. Cooper had introduced many enlightened policies, such as stressing promotion from within. He established the TRANS-ATLANTIC BLOOD FEUD 419.
Hudson's Bay Record Society to take over publication of the Company's historic doc.u.ments. He was the first Governor to hold summer picnics for the London staff at his home, and even demonstrated a sense of humour when he read out to an annual Court a letter he had received. ”I got your letter about what I owe,” wrote the troubled UIBC customer. ”Now be pachant. I ain't forgot vou. Please wait. When I have the money I will pay you. if this was the Judgement Day and you was no more prepared to meet your maker than I am to meet your account you sure would go to h.e.l.l.
Trusting you will do this.”
I kind of liked Sir Patrick,” remarked Scotty Gall, the old Arctic hand, who met the Governor several times. 'T le loved the feudal system, behaved like a baron coming around to inspect his serfs. But he was a keen businessman, too. He knew the right side of the dollar and gave nothing away.” That was true enough, and there was no doubt that Cooper had rescued the Company from the Depression. But the post-war era demanded other qualities, and even if it was mostly Chester's fault, relations between Winnipeg and London had deteriorated beyond repair, so that no concerted expansion plan could be put into effect. Cooper's exag- gerated sense of personal vanity had become even less endearing to Canadians than it was to the Londoners, and his Churchillian refrain, that he had not become Governor of the HBC in order to preside over its dissolution, was a brave stance but hardly a policy.
During his tenure at Beaver House, Cooper had acquired a collection of silver pieces made in 1670, the year of the Company's founding, and had special carpets woven in Kidderminster by four artisans especially chosen for the job. He also had his portrait painted, and as was then the custom, an extra copy was done for a 420 MERCHANT PRINCES.
record of the original. Cooper borrowed the copy to hang in his country house and one summer weekend in 1952 told R.A. Reynolds, the Company secretary, he was taking the original home to compare the two canvases.
Reynolds had placed a secret mark on the primary painting and was not too surprised when Cooper returned on Monday morning, pa.s.sing off the copy as the real thing.
It was a tiny incident, but it raised questions about Cooper's approach.
There had been rumours that he was charging his London flat to the Company and that he accepted generous expense-account advances but seldom reported on them. Whether or not this amounted to any serious abuse of his fiscal responsibilities, it certainly was true that after more than two decades in the Governor's chair Cooper had lost the ability to differentiate between his personal considerations and those of the Company. There were, in those days, very tight foreign exchange controls in Britain, to the extent that executives travelling abroad were allocated ridiculously small spending allowances. The Bank of England agreed to grant Cooper, as HBC Governor, a special exemption to finance his journeys and required entertainments, yet Company auditors discovered that he was withdrawing a similar amount from the Winnipeg office but sending his bills through to be paid in London. Cooper made his own rules and at one time even imported a tractor for his farm with the allowance granted him by the British central bank. The London board members deputized Lord Waverley to persuade Cooper that he should resign. The final confrontation, attended by Tony Keswick (by then promoted to Deputy Governor) and Waverley, left Cooper no escape.
Keswick recalled later, ”We just said: 'The staff have lost confidence; it's no use trying to build it up. It must come to an end. There must be a change.”'
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”Do I understand what that means?” asked a distraught Cooper.
”You understand what it means.”
”Yes, I understand what it means. We won't discuss it any more.”
And so, on November 19, 1952, Sir Patrick Ashley Cooper resigned as thirtieth Governor of the Hudson's Bay Company.
Chester had won.
CHAPTER15.
CANADIAN AT LAST.
”The British have the rigidity of red hot pokers without their warmth. ”
-Lord Amory
TONY KESWICK, WHO HAD BEEN BROUGHT on the board by Cooper in the mid-1940s, now took over as Governor, and his presence introduced a whiff of China Seas buccanecring to the HBCs deliberations. ”He was a big man in every sense, a sharp trader, and I thoroughly enjoyed working with him,” reminisced Eric Faulkner, who was for a time his Deputy, ”although there were moments when one had to slightly pull on the reins and say, 'Tony, you're going a bit too far. There's too much bulls.h.i.+t in that, you must be more careful.”'
To such admonitions, mild as they were, Keswick preferred to reply with a parable and a fact. The fact was that during his stewards.h.i.+p, HBC profits climbed 320 percent; the parable had something to do with a myth- ical creature known as the Arctic Robin. ”It had been snowing for a long, long time,” went his oft-told tale, ”and the poor bird, having had nothing to eat, said to himself, 'I think I'll turn up my toes and pack it in.'Just then, a farmer let his bull out of its pen near where the Arctic Robin was sitting. The bull had been overfed and after a while deposited an enormous pile, which allowed
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the Robin to have a delicious hot breakfast. The bird, feeling perky again, flew up a tree and started singing so loudly that it attracted the attention of the farmer's son, who fetched a catapult, took aim, and killed the Arctic Robin stone dead.” The point of the story, as Keswick loved to explain through snorts of belly-pumping laughter, was that ”if you get to the top with the aid of bulls.h.i.+t, you shouldn't sing about it.”
Keswick came by his merchant adventurer's calling honestly, having been a.s.sociated for most of his business life with Jardine, Matheson, the Hong Kong trading house. ”Both companies, at different times and different places, lived dangerously and had to struggle against larger forces,” he pointed out. ”Whatever else, the life of a merchant adventurer is full of incidents.” One such incident that ill.u.s.trated Keswick's approach to life and adventure made good his claim that he may have been the only politician ever shot for making a budget speech. In the winter of 1940-41, when he was working forjardine's along the South China coast, the invading j.a.panese had hived most of the surviving foreign community into the International Settlement, the European quarter of Shanghai.
Elected head of the munic.i.p.al council, Keswick was presenting his annual budget at an outdoor arena in Shanghai filled with five thousand ratepayers when Yukichi Hayas.h.i.+, a j.a.panese radical opposed to the foreign presence, rushed on stage, took out a revolver and began firing at him. The first bullet went through his rib cage, causing Keswick to feel genu1nely annoyed. ”I told the j.a.panese fellow, 'For G.o.d's sake, stop that.' Then I fell on top of the little chap. Nearly killed him. He tried to send another bullet up my nose and took three fingers off the interpreter's left hand with his last shot. Seemed very upset.”
His would-be a.s.sa.s.sin was hailed as a hero in 'Ibkyo while Keswick escaped with only superficial wounds and CANADIAN AT LAST 425.