Lehman Brothers Holdings is a company that is now 156-year-old. It met many near death incidents and reached its climax in 2006. Mr. Richard S. Fuld, Jr., CEO of Lehman Brothers administered the company thirteen years ago when it was then a subsidiary and changed Lehman from a small-time company in Wall Street to a very powerful company worldwide.
The CNN.com mentioned that in 1994 Lehman Brothers went public and had $75 million in earnings only and an equity return of 2.2%. An unbelievable turn came in 2005 where the firm had $32 billion in revenues, $3.2 billion in profit and an equity return of 19.4%. Lehman Brothers is placed at No. 16 among the list of companies in the Fortune 500.
Some say Fuld is aggressive, confrontational, and blunt as what is expected of a firm leader. Lehman Brothers became one of the amazing firms of Wall Street with the directions of Fuld. He used money, which he considers his very important tool to transform the sibling rivalry culture of the employees to teamwork and cooperation within the firm.
Emerging doubts about Lehman Brothers still arise and some critics are worried on the falling interest rates which is the major factor affecting the performance of the firm in the past ten years.
Okay, let us admit that there are others that will say the “big boss” is not much interested in giving safety to the company assets and is more interested in the earning bonus. Over the past two years, over $150 million in compensation was earned by the CEO and it is not for the benefit of the company’s shareholders but only for his own benefit. Disguised opportunists were said to stay in the company rather than those who give honest advice and guidance to Mr. Fuld.
With this bankruptcy filing news of Lehman Brothers Holdings on 15 September 2008 and all the other things said and done, the global economy’s future will suffer a lot most specifically the developing countries. Still the future will be based on those who are richer and will affect the smallest aspect of economic life and its policies.
As always, the saying goes “Great power comes with great responsibility.” I hope they are responsible enough for their action—as the world is at stake here.
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