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Albert Gordon: Financial Leadership the Old-Fashioned Way

While a competitor's slogan claimed "We make money the old-fashioned way, we earn it," Kidder Peabody's Albert H. Gordon, who died on May 7, actually lived that slogan. Indeed, Gordon's astonishing 107¾ years was not his most inspiring accomplishment. It was his continued demonstration of a noble sense of purpose as a financier, an idea and an ideal that seem lost in current headlines about many of his successors in that profession.

Born the year President McKinley was assassinated, when there were only 1,500 cars on the road—and before Chrysler, Ford (F), or GM (GM) existed—Gordon knew Civil War generals as a child. He worked with financial legends of another age, such as J.P. Morgan Jr., Robert Lehman, Mortimer Schiff, and Sidney Weinberg, but also knew today's legends, including Jamie Dimon and Steve Schwarzman.

Gordon loved his profession and excelled through integrity, initiative, and prudent risk-taking. The Dow soared 400% between 1922 and 1929—but Gordon anticipated the Crash and cleared out of the stock market months before. Similarly, Gordon got out of U.S. equities 79 years later, escaping another crash (with his investments up 15%, to boot).

An Institution Builder

He was more than a savvy investor. Gordon was also a shrewd institution builder. In 1931, he devised a plan to revive the venerable but collapsing Kidder Peabody. Gordon, then a 29-year-old Goldman Sachs (GS) commercial paper salesman, persuaded the controlling Webster family to invest more, installing a family scion, Edward Webster Jr., an older classmate, as a figurehead in the firm's leadership. Gordon did not shrink from conflict or corporate politics as envious colleagues tried to undermine his relationship with Webster and ingratiate themselves with Webster.

Gordon explained to me: "Ed Webster was the official head of the institution until his death in 1958 and I was the actual head. We had differences of opinion and personality differences…he was being buttered up by other people." Gordon transferred some of his responsibilities to Webster, who promptly gave them right back. "Some of the business was too much for him," Gordon noted.

His 1931 turnaround plan for Kidder Peabody worked. Gordon obtained support from Schiff of Kuhn Loeb and pressured J.P. Morgan Jr. to repay old debts. He shifted the firm's base from Boston to New York, and pioneered the idea of having offices elsewhere in the U.S. and later in Europe and Japan to create a distribution network that would be both envied and emulated. He expanded the underwriting of high-grade securities and deemphasized private banking and foreign exchange. By the 1940s, Kidder rebounded as a top underwriter and prestigious investment bank.

Unconcerned about race, religion, gender, or even age, Gordon promoted a new meritocratic spirit in an old "blue-blood" merchant bank. As he told me in a 1983 interview for my book The Hero's Farewell: "In Kidder, anybody that has an ounce of productive capacity, as measured by the bottom line, does not have to retire…. It is necessary, however, to give leadership responsibility to other people so that they can learn."

Subways and Coach Seats

In contrast to the greed and sense of entitlement that characterize so many contemporary executives, Gordon evinced genuine frugality and concern for the bottom line. He sold his ownership shares back to his employees at discount prices, flew exclusively in coach, and took the subway to work. As he explained to me, "I never wanted anyone to think of me as 'that old greedy bastard.' " Spotting a young Kidder executive in first class, he passed a note from his own coach seat: "What is the food like up there?" He advised a traffic-delayed office visitor (me) who complained about trouble getting a taxi in the rain, "You should have just hopped on a train—like I do—headed for Wall Street. Folks have heard of the stop!"

Although he attributed longevity to lucky genes, he ate carefully and exercised, running the London Marathon at 82. A student of health and nutrition, he correctly anticipated later neurobiological findings that mental exercise was as important as physical exercise, so he taught himself new languages, studied, and read voraciously. As a centenarian, he continued to travel by subway or taxi from his uptown home to his midtown office to work a five-day week, slowing up only in his last few years due to problems walking.

As a philanthropist, Gordon was generous but quiet about his donations. At a 2002 conference, Yale's president playfully asked the then-100-year-old Gordon, a long-standing Harvard donor, if he might want to give a little something to the Elis. Gordon, noting the "big to-do" made over Yale's 300th anniversary, remarked that perhaps the celebration was premature. "Now I am just one person, but I am already one-third of the way myself. Shouldn't we wait a bit to see if Yale makes it?"

He showed similar humor and humility at the NYSE in 2007 when he joined a CEO summit held in the august 101-year-old building, then designated a national monument. Gordon announced, "Unsure how to distinguish myself in so impressive a group, I thought I'd be the guy who didn't wear a tie." A thunderous standing ovation followed.

General Electric (GE), after acquiring Kidder in 1986, suffered the tarnishing scandals and sold it to PaineWebber in 1994. The newspaper announcement was co-signed by PaineWebber CEO Don Marron and by long-retired 93-year-old Al Gordon on behalf of Kidder—in a brilliant effort to recapture Kidder's once-prized image for integrity, prestige, and performance.

Jeffrey A. Sonnenfeld is the Senior Associate Dean of the Yale School of Management for Executive Programs and Lester Crown Professor of Management Practice as well as co-author of Firing Back: How Great Leaders Overcome Career Disasters. He can be reached at

Jeffrey A. Sonnenfeld is the senior associate dean for executive programs and the Lester Crown Professor of Management Practice at the Yale School of Management, as well as co-author of Firing Back: How Great Leaders Overcome Career Disasters. He can be reached at

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