In the mid-1950s, investment banker John Whitehead was seated on a plane next to one of the biggest names in corporate finance: Albert Gordon, head of the securities firm Kidder Peabody.

They were on a commuter flight from Boston to New York.

Whitehead wondered what was in Gordon's satchel. Perhaps files for his next big bond underwriting. When he asked, Gordon smiled at Whitehead, who was 20 years younger, and said, "My running clothes. I'm going to jog back to Manhattan. Care to join me?"

Gordon, a Harvard track star in the 1920s, was always on the run, and not just literally.

He took a sincere interest in meeting and guiding young talent in the banking business. He was an avid runner his entire life and encouraged young bankers to exercise with equal zeal. Gordon also recommended that they pursue graduate business degrees. He completed an MBA at Harvard after finishing his undergraduate studies there.

At Kidder, Gordon was known for promoting hardworking associates into management positions as a way of grooming them to lead the firm.

Securing Kidder's longevity was his passionate concern. When Gordon was just 30, Edwin Stone — Kidder's controlling shareholder and the father of one of Gordon's Harvard classmates — asked the young banker to leave his job at Goldman Sachs and rescue Kidder from imminent bankruptcy. It was 1931, and the Depression had dried up Kidder's underwriting business.

After agreeing, Gordon secured financial help from JPMorgan. That provided a lifeline while he resuscitated Kidder's underwriting business. He also slashed costs, but kept salaries intact to prevent talented staff from leaving. In the following years, Gordon expanded the firm's overseas operations.

Through it all, Gordon maintained his role as a mentor and guide to young associates. Besides strengthening Kidder, this helped Gordon navigate the most momentous decision of his career: choosing a successor to lead the company that he had come to embody.

According to Yale business school professor Jeffrey Sonnenfeld, Gordon stands out among American executives for keeping his ego in check when selecting and grooming a successor. Rather than holding tightly to the reins of power for as long as possible, Gordon spent years preparing Kidder for a new chief executive. He knew that the benefits of a smooth transition would redound to his chosen candidate, the firm and its clients.

Sonnenfeld, who has studied executive transition, says Gordon typifies the "ambassadorial" style of retirement. Instead of hunkering down in the executive suite, ambassadors publicly pass the baton to a successor. This prepares employees and customers for a new chain of command. In retirement, ambassadors avoid meddling in the affairs of the companies they once ran. They may sit on a company's board, but abstain from day-to-day management.

Gordon's ambassadorial strain stems from his view of Kidder as an institution with a legacy much larger than his personal role within it. He had a similar reverence for his alma mater, Harvard. Gordon actively recruited associates from the school and held an open position for captains of the track team. To this day, he remains one of Harvard's most generous benefactors, and he sponsors a professorship at Harvard Business School.

Also, Gordon supported educational and health care institutions. He served on the boards of the private Chapin School and Memorial Sloan-Kettering Hospital, both in New York City, and Massachusetts' Roxbury Latin School.

"Gordon didn't define himself by the job, and his identity was not tied to the trappings of the office," Sonnenfeld told IBD. "He donated a lot of time and money to charitable causes. This helped prevent him from becoming overly dependent on his job for a sense of self-worth."

In the late 1960s, Gordon began thinking about retiring as Kidder's CEO. His most likely successor was Ralph DeNunzio, a graduate of Princeton. Gordon had spent 15 years mentoring DeNunzio through several internal positions.

This gave DeNunzio exposure to Kidder's businesses, which ranged from brokerage services and investment banking to syndicating corporate loans and managing wealth for private clients. For a time, DeNunzio sold securities in New York. When Kidder's syndicate manager in Chicago left, Gordon sent DeNunzio to fill that position. In 1969, Gordon promoted DeNunzio to Kidder's management committee.

"Gordon believed it was important to move young managers into the positions of older ones," wrote Sonnenfeld in "The Hero's Farewell," his book on management succession.

In 1971, Gordon sponsored DeNunzio's successful bid to become the youngest chairman of the board of governors of the New York Stock Exchange. After turning over the CEO spot to DeNunzio, Gordon began selling back his ownership stake in Kidder, signaling that he was relinquishing control and would not challenge new management.

As Kidder's elder statesman, Gordon continued to drum up business by nurturing deals with old contacts from Arm & Hammer and Occidental Petroleum. For a debt underwriting opportunity, he traveled from Kidder's headquarters in New York City to Georgia to meet the CEO of wire and cable maker Southwire.

"Al just went down there, knocked on the door and proceeded to pitch Kidder for the deal," said Sonnenfeld. "It was no slam dunk. It took salesmanship. Al maintained a self-effacing ability to make cold calls well into his late 80s."

Kidder's legacy and banking talent made it a prime takeover candidate for the financial conglomerates that began developing in the 1980s. In 1986, Gordon helped negotiate Kidder's sale to General Electric for $600 million.

Gordon's role as elder statesman extended beyond Kidder to any promising banker he met, like Whitehead, who later served as undersecretary of state to President Reagan. And like Reagan, Gordon was able to make friends of his competitors, even in a notoriously cutthroat business.

"He was fully respected at Kidder and very popular within the industry," said Whitehead, who stayed friends with Gordon after meeting him on the plane in the '50s.

Today Gordon, 105, lives in New York City. "A lot of people were sad to see him phase out," Whitehead said. "Some of his competitors breathed a sigh of relief."

BY DANIEL DEL'RE