EXAMINING RISK MANAGEMENT PRACTICES AND CORPORATE GOVERNANCE IN CITIGROUP, GOLDMAN SACHS AND JP MORGAN

lu, chengen (2009) EXAMINING RISK MANAGEMENT PRACTICES AND CORPORATE GOVERNANCE IN CITIGROUP, GOLDMAN SACHS AND JP MORGAN. [Dissertation (University of Nottingham only)] (Unpublished)

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Abstract

The President of the United States, Obama described the subprime crisis as “the worst financial crisis since the Great Depression”. So how a crisis like this could have happened? The crisis provides food for thoughts on the issues of financial organizations’ risk management and corporate governance. This dissertation examines bank’ risk management and corporate governance under three themes, they are Theme 1: CRO and Risk committees, Theme 2: Risk measurement and mitigation, and Theme 3: Compensation Policy and Board Composition

The discussion will be based on data from three banks: Citigroup (Citi), Goldman Sachs (GS) and JP Morgan (JPM), over a period of eight years from financial year 2001 to 2008. Different from other research which is mostly quantitative, this dissertation adopts a qualitative perspective. A literature review is conducted in order to understand the best practices of risk management and corporate governance under the three themes, followed by a in-depth analysis to determine how each of the three firms perform in those aspects. In general, based on their reports and accountings, it was found that Citi have performed significantly worse in all aspects when compared to JPM and GS prior to the crisis, and it did not improve much after the crisis. As reflect in the 2008’s reports, despite the fact that GS became a bank holding company in 2008 and disclosure was expected to align with Citi and JPM, the least information was provided before and after the crisis. From the limited information provided by GS, it is found that GS has in place a good risk management system and sound corporate governance. On the other hand, JPM has in place a sound risk management system that is comparable to GS; it has good corporate governance and had provided rich information to investors.

Item Type: Dissertation (University of Nottingham only)
Depositing User: EP, Services
Date Deposited: 04 Feb 2010 10:26
Last Modified: 23 Oct 2016 07:33
URI: http://eprints.nottingham.ac.uk/id/eprint/23313

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