As we have discussed at length, when it comes to the art of regulating one’s emotions while investing, there are two models to choose from: The Dead Inside paradigm, wherein you remain calm, cool, and collected, maintaining the same expression on your face whether you’ve lost $1 billion on one trade or made three times that much on another; and The Bill Ackman. The mega-successful Pershing Square founder imbues emotion in everything he does, particularly when it comes to his job. As a man who wears his heart on his sleeve, in the past Ackman has been known to: cry at shareholder meetings; get extremely heated to the point of his face becoming “flushed,” his eyes “misty” when meeting with SEC investigators; pen “long, emotional, late-night missives” to top SEC brass; and erupt on directors of companies with such passion that his “furious outburst” could be “heard in an outside hallway.”
As there are few on Wall Street who exhibit such raw emotion while conducting business, and there is a propensity by some to employ tactics that will put them in the power position when facing foes, perhaps it should not come as too much of a shock that recently, a reporter asked Ackman whether or not the waterworks or displays of indignation are pre-planned, in front of a mirror. For those who’ve long known Ackman has more integrity in one salty tear than most have in their entire body, his answer will not come as a shock, but to set the record straight, for anyone holding out hope of seeing him do a little regional theater at some point in the future:
Ackman’s most vitriolic outburst occurred after his proxy vote triumph at CP’s annual meeting in Calgary this past May. Minutes after his overwhelming victory—which saw Cleghorn, Green and four other directors resign—Ackman walked into a meeting room at the Sheraton Hotel. Waiting at the table were his chosen directors, plus most of the board’s remaining old guard, including retired Suncor chief Rick George, U.S. rail veteran Tony Ingram, and Madeleine Paquin, head of Montreal cargo operator Logistec Corp. Ackman was proposing that two members of his slate—former head of the Alberta Treasury Branches Paul Haggis and U.S. railway veteran Stephen Tobias—be named chairman and interim CEO, respectively. Instead of bowed heads and a trembling white flag, Ackman faced a counteroffensive. Staring down the activist, the directors proposed installing Ingram as chairman, and chief financial officer Kathryn McQuade as interim CEO. Ackman’s furious outburst could be heard in an outside hallway, where a clutch of advisers was standing by. According to people familiar with the session, Ackman challenged Ingram’s credentials, accusing the directors of attempting to thwart his long-term plan to name Harrison CEO. “I think you missed what just took place at the shareholders’ meeting,” Ackman yelled. “We will go right back outside and we will run another proxy contest to replace the balance of the directors.” After a recess, the startled stalwarts agreed to a compromise: Tobias was named interim CEO and Paquin, acting chair. Within months, George and Ingram had resigned from the board, Harrison was anointed CEO, and Haggis became chairman.
Half a year later, Ackman is asked to explain his Calgary outburst. “Ballistic is too strong a word,” he says. He searches long and hard for diplomatic words to explain his passionate reaction in the CP boardroom. “There were a lot of bruised feelings,” he says. “It took a while before we were able to work it out. The first few hours were not easy.” When it is suggested that his anger may be a deliberate act to unnerve his adversaries, he is incensed. “I don’t act, ever,” he says. “I’m exactly who I appear to be. I am unfiltered, for better or worse.”
ROB Magazine’s CEO of the Year: Bill Ackman [Globe And Mail]