Sunday, March 19, 2006

Thumbs Up for Citigroup


One of the markers of reputation recovery is making signs of progress visible. Of course if you have the choice, the best way is to get someone else to broadcast it for you. That's what happened yesterday to Citigroup. In Clint Riley's Wall Street Journal article, "Citigroup Gets Higher Grades for Its Corporate Governance," the writer underscores the positive progress being made by CEO Chuck Prince's journey to become "the most respected global financial-services company." Riley gathers votes of confidence from several corporate governance rating experts who give Citigroup a clean bill of health. One of the experts even called the financial services giant, "the new Citigroup."

+++Howard Sherman, COO, Governance Metrics International
+++Ric Marshall, chief analyst, Corporate Library
+++Robert A.G. Monks, founder, Institutional Shareholder Services and now Lens Governance Advisors


Prince's plan to overhaul the company after its Japanese trading scandal and European bond-trading misstep is bearing fruit. His "five point" plan includes intensive employee training ("Our Shared Responsibilities"), good corporate governance practices, better communications and board independence. The video on the company's long history that is part of the training appears on the web site and goes a long way towards educating Citigroupers as to their shared history and obligation to the revered franchise.

Although early positive endorsements can be reversed with the slightest misstep, these thumbs up for Citigroup go a long way in building momentum and energizing its 300,000 employees. The key is not to forget that recovery is a marathon, not a sprint. Repuation recovery is never finished.

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