Barton draws on past to help Teck ‘withstand torpedoes’
New chairman of mining giant built solid reputation advising corporations for decades
DANIELLE BOCHOVE When Dominic Barton was named chairman of Teck Resources Ltd., he was handed a rock hammer by Norman Keevil, his predecessor and controlling shareholder at Canada’s biggest diversified miner.
Inscribed: “Chair to Chair, 2018” it was an apt symbol for Barton, the former global managing partner of McKinsey & Co. who for decades chipped away at the ground-level for the corporations he advised, while maintaining a longer-term view from above.
“It’s kind of like having a telescope and a microscope and one eye,” Barton said in an interview, referring to a strategy that allows a business to invest for the long-term while delivering good results from quarter to quarter.
It’s the greatest challenge miners face: Assets take years to develop, and trying to time new production with strong commodity prices is a mug’s game. In Teck’s case, the nearterm goalpost is pulling off the Quebrada Blanca Phase 2 expansion in Chile. Further out, global trends, including the move to electric vehicles and the inexorable ascendancy of Asia, are reshaping the markets in which Teck plays: metallurgical coal, base metals and energy.
“What’s happening in Japan, Korea, China of course, is still the single biggest determinant,” said Don Lindsay, 60, Teck’s chief executive officer. “Dominic, given his background, will be very good at asking those kinds of questions and leading those kinds of discussions.”
Barton has the global pedigree. Born in Uganda, the 56year-old Rhodes scholar has lived in Asia, Europe and North America. On the day of the interview, he arrives at McKinsey’s Toronto headquarters from Singapore, via a stop in Vancouver for his first board meeting at Teck’s head office. It’s the 50th anniversary of McKinsey’s Canadian operations and the Toronto “ski chateau,” as the office is known, is filling up with more than 500 alumni from around the world.
Despite the din outside the cosy meeting room, Barton takes his time. He talks at length about the future of Asia and his greatest near-term fear: that the economic hit from a global trade war, coupled with rising interest rates, lead to stagflation and a Depression-era level of isolationism. Right now it’s more of a “tail risk,” but one for which Teck must be prepared. The good news is copper and met coal will always be needed, the miner’s balance sheet is strong, and Teck has weathered storms before.
“A key part of strategy is resilience,” he said. “It’s being able to withstand the torpedoes.”
During his time at McKinsey, Barton has seen more than a few, including some direct hits. The firm recently emerged from a scandal involving contracts in South Africa and, just this month, was drawn into the issue of human rights in Saudi Arabia after the New York Times reported some of McKinsey’s work may have been used by the kingdom to silence dissidents. He’s also had a front-row seat for some of the biggest economic upheavals of the last 20 years; his time in South Korea coincided with the Asian economic crisis and he was in London during Brexit.
Through that, he’s proved himself “highly intelligent, disarming and bold,” says John Thornton, executive chairman of Barrick Gold Corp., who has known Barton for more than a decade. Both are adjunct professors at Tsinghua University in Beijing and Barton is a trustee at the Brookings Institution where Thornton is chairman.
Just weeks into the job, Barton’s loathe to be specific about his plans for Teck. He hopes to leverage Keevil’s wisdom and says neither the family nor Teck’s dual-class structure are going anywhere. While Keevil stepped down as chairman Oct. 1, his son Norman Keevil III remains on the board as vice chairman.