Tuesday 17th July 2018

Resource Clips


Ian Telfer talks

Transcending low grades in school, he hit high grades in mining and philanthropy

by Greg Klein

Goldcorp’s boss transcended lousy academic grades to acquire high-grade mines

A few of Goldcorp’s 15,000 employees stride through Quebec’s Éléonore mine.

 

Here’s a guy who got rejected not by “virtually every university in Canada, it was every university in Canada”—and for an MBA program at that. Now chairperson of Goldcorp TSX:G, Ian Telfer credits one school’s 11th-hour offer with giving him a second shot at his career, putting an undistinguished background behind him to become a serial success story. His reflections provided inspiration to a sold-out Vancouver audience of 850 people hoping to pick up some of the magic that made him a mining legend.

The June 28 event saw him interviewed on stage by Peter Legge, a standup comic-turned-publisher and author of several motivational books. Consequently, conversation focused less on mining deals than on qualities that might complement success in any industry. Hosting the event was BCBusiness, a magazine created by Cambridge House International founder Joe Martin and sold to Legge by local zillionaire Jim Pattison.

Goldcorp’s boss transcended lousy academic grades to acquire high-grade mines

The man with the golden shoes and Midas touch
plans to devote his very considerable net worth
to good causes.

Telfer’s mid-career second chance came from the University of Ottawa, in a surprise phone call the day before classes started. Taking his studies seriously this time, he went on to become a chartered accountant and financial analyst for Hudbay Minerals TSX:HBM predecessor Hudson Bay Mining and Smelting. Looking back, he describes his former self as a mediocre salesman and “probably less than a mediocre accountant.”

But junior mining requires “promoting ideas that you hope are going to turn into companies. You have to do some selling and you have to understand numbers and it turned out I was a better accountant than the other salesman and a better salesman than the other accountant.”

By 1983 he was in Brazil running TVX Gold, an eventual Kinross Gold TSX:K acquisition, with Eike Batista. The latter went on to become the country’s richest man. But this week he got 30 years for bribing a politician.

Somewhat milder were Telfer’s career disappointments, which included an unsuccessful foray into the late 1990s tech bubble. A few years later, however, he and Frank Giustra took advantage of gold’s dismal price to pick up Wheaton River Minerals. A string of acquisitions expanded the company, enticing Rob McEwen’s Goldcorp into a merger. Telfer took over as Goldcorp’s CEO and, now at age 72, remains chairperson. Under his leadership, continued M&A brought the company to 2.57 million ounces of gold production last year, planned growth to three million ounces by 2021, and a current staff of 15,000. That compares with a half-dozen employees when he took over Wheaton River.

Still, his Hudson Bay experience proved pivotal. The company brought in an American experienced in the early ’80s new concept of strategic planning and, Telfer says with emphatic pauses after each word: “I. Learned. So. Much. From. Him.

“American businessmen—they are tougher. They are more demanding, they are way less user-friendly than Canadian executives for sure…. I learned from him how high standards could be. He was one of those people, you could put together a whole presentation and he’d throw it in the garbage. No Canadian boss I’d ever worked for would ever do anything like that…. I thought he was tough, he’d tell me stories about bosses he had that were horrific. Why? They raise your standards so high…. I felt I learned everything I learned about business from him.”

Peter Munk’s comment was that all the good that came to him came from society, and it should go back. And so that will be my legacy.

His future involves “probably not starting any new businesses but I don’t rule it out.” As for his legacy, he says he’s “incredibly proud of Goldcorp” as a source of careers and philanthropy. He also expresses admiration for Peter Munk, who “gave away his complete net worth to charity. And while a lot of successful people say they’re going to do that, most of them don’t…. Peter Munk’s comment was that all the good that came to him came from society, and it should go back. And so that will be my legacy.”

Having donated many millions so far, his $5,000 scholarship at the University of Ottawa might seem insignificant were it not for the criteria. Commemorating his own academic performance, the money’s granted each year to the student who enters first-year MBA classes with the lowest marks.

Speaking with ResourceClips.com, Telfer reiterated his belief that the world has reached peak gold. That, along with growing inflation and a weakening U.S. dollar should raise prices, he maintained. “There hasn’t been much inflation for a while but I think that’s starting. The U.S. dollar being strong also has an impact on the price of gold. So I think the supply of gold is going down, inflation is coming up and the U.S. dollar is going to weaken, and all three of those are good for gold.”

The industry’s biggest challenge is “finding reserves,” he added. “The most difficult part of our business is the exploration part. The whole industry, all the metals but especially gold, are having a very difficult time replacing reserves. So companies are starting to shrink. That’s our biggest challenge.”

Does that bode well for juniors? “If they find things.”


Comments are closed.

Share | rss feed

View All: Feature Articles