Updated 4.15.2009

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Summary: Huge concerns around Board Effectiveness as well as Senior Management Effectiveness. Overall, Internal Control Environment in terms of the Audit Committee Report Quality is also a concern.


Our evaluation identifies some concerns around the effectiveness of the Board and Senior Management. There are several audit committee members who are on an excessive number of public company boards. A senior executive is an investor in a fund in which Citigroup is invested and has fund withdrawal rights that seem to be tied to his employment at Citigroup. Most directors are also not expressly prohibited from performing consulting services for the company.


On the social and environmental front, Citigroup has reported an increase of carbon emissions in 2008.


Subscribed members can view a detailed analysis of individual sections by clicking on the tabs above.

Is the Board and Senior Management of Citigroup effective?

  1. Responsibilities of an Audit Committee of the Board of Directors generally include providing oversight of the company’s financial reporting, accounting as well as oversight of the audit of financial statements. When you review the number of boards that some members of Citigroup’s Audit and Risk Management Committee serve on, they appear to be over extended . It is difficult to imagine these members being able to devote adequate time and effort to each of their corporate commitments. (Please refer to the tab on ‘Internal Control Environment’).

  2. According to the Proxy statement filed in March 2009, one of the investors in a Hedge Fund that Citigroup purchased and who is now a senior employee at Citi, can withdraw his funds, amounting to multi million dollars, if his employment terminates for any reason. (Please refer to the tab on ‘Internal Control Environment’).

  3. According to the company's Corporate Governance Guidelines, members of the Audit and Risk Management Committee are prohibited from performing consulting services for the company. However, other Board Committee members may provide such services after getting the approval of the Nomination and Governance Board Committee . Not forbidding ALL Board Members from providing consulting services may pose a threat of conflict of interest. (Refer to the tab on ‘Internal Control Environment’).

  4. In August 2008, Citigroup announced changes with respect to the Board’s Executive Committee. (Please refer to the tab on ‘Board of Directors and Management').


Has Citigroup as a company reduced its environmental impact?

  1. The company has reported an increase in the total CO2 emissions in 2008 as compared to 2007. (Please refer to the tab on 'Social and Environment').

  2. Our sources for gathering all relevant information include Citigroup’s Proxy Statement filed in March 2009 as well their Eighth Annual Citizenship Report.


Related Posts

Detailed Scorecard


Board Size: 13 (as per 2008 Proxy Statement filed in March 2009.)

Board of Directors Compensation ($): Cash- $75,000; Deferred Stock Award- $150,000

Total CO2 emissions(metric tons): 2008-14,27,416; 2007- 14,19,551

Amount received in Government Bailout ($): $50 Billion

Total CEO compensation for 2008($): $10.82 million

Chief Risk Officer: Brian Leach

Changes in Chief Risk Officer over the past 2 years**: Twice (Jorge Bermudez appointed in 2007 succeeded by Brian Leach in 2008. Jorge Bermudez retired after 33 years of service.)

Tenure of Chief Risk Officer in this position: Brian Leach has held the position of Chief Risk Officer at Citigroup since March 2008.

** Why do we look at ‘Changes in Chief Risk Officer’?  Companies, where we observe quick changes to senior risk positions (in case of companies in the finance industry) are high on our ‘watch’ list.