Navigating Turbulence on Wall Street

Context

Jane Fraser shattered the glass ceiling as the first female CEO of a major Wall Street bank, defying long-standing barriers in a male-dominated industry.

Her appointment as the CEO of Citigroup in 2021 marked a turning point, especially after a dry spell when no women held top leadership roles at the largest US banks. 

Fraser’s vision of Citi as the “bank with a soul” has resonated across Wall Street. In an industry where ruthless competition can often overshadow human values, she has anchored the bank’s strategy in employee well-being, using empathy to navigate turbulent markets. Her knack for hiring talent sharper than herself and her ability to adapt in the face of disruption have become her trademark in steering through crises.

As a trailblazer, Fraser doesn’t shy away from the thorniest issues women face in the corporate world. She has turned her success into a platform, using her influence to pave the way for newer generations to thrive while championing work-life balance and diversity in financial services – areas long neglected by the industry’s old guard.

However, long before she smashed the glass ceiling as a CEO, Fraser first sharpened her acumen for crisis management.

What makes Jane Fraser the quintessential WarTime CEO?

Real-Life Story

Fraser is no stranger to Citigroup’s history of walking the tightrope of success. She led recovery efforts during a 2013 market slump, which demanded the tough decision of shuttering offices and cutting over 1,000 jobs – it was necessary to stabilise operations.

In 2014, Fraser found herself at the helm during the fallout of Citigroup’s US$7bn settlement over mortgage-backed securities.

The bank was accused of pulling the wool over investors’ eyes regarding the quality of the securities sold before the 2008 financial meltdown. These caused hefty losses for investors.

The settlement – which included a record $4bn penalty to the US Justice Department – dealt a heavy blow, but Fraser deftly navigated through the crisis. Her approach? Focus on risk management and strengthen internal controls to plug the holes that regulators had flagged. The overhaul was designed to keep Citigroup compliant and steer it back to calmer waters.

Fraser also led efforts to offload toxic assets left over from the chaos of the 2008 financial crisis – a strategy that helped the bank stay afloat when others sank. She embraced the painful process of simplifying Citigroup’s operations by divesting non-core businesses and doubling down on high-growth areas such as wealth management. It was a strategic retreat to regroup and refocus.

Fraser’s ability to fix what’s broken became her hallmark. She restructured operations, cutting away underperforming divisions and bolstering business lines that held promise. Her time at McKinsey sharpened her edge in strategic analysis and problem-solving, skills she wielded in identifying inefficiencies and course-correcting.

Citigroup not only ticked all the boxes for regulatory compliance but emerged leaner and more agile – and poised for growth in a landscape where few could see the horizon.

PostScript: Fraser continues to drive a cultural shift from the top down. Her emphasis on empathy, collaboration and innovation has rekindled a spirit of teamwork, with transparency and accountability as the bedrock of Citi’s success today.

Key Lessons

1) Long-term risk management

Crisis management isn’t just about immediate damage control; it’s also about fortifying the business for the long haul. Fraser’s focus on improving risk management and internal controls ensured Citigroup was not only compliant with regulations but also more resilient for future challenges.

2) Simplifying and streamlining operations

In times of crisis, complexity can become a liability. By divesting non-core businesses and focussing on high-growth areas, Fraser streamlined Citigroup’s operations, allowing the company to concentrate its resources where they would have the greatest impact.

3) Making data-driven decisions

During turbulent times, intuition alone won’t cut it. Fraser’s strategic decisions, such as divesting non-core businesses, were rooted in careful analysis and a deep understanding of market trends. WarTime CEOs rely on data and insights to guide their actions.

4) Leading with empathy and accountability

During difficult times, a WarTime CEO balances hard decisions with empathy. Fraser’s commitment to creating a culture of transparency and open communication fostered trust within the organisation, proving that strong leadership doesn’t have to come at the cost of morale.

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Until next week, may the force be with you.

Kevin

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