Wednesday, June 18, 2008

Former CFO speaks on IR

Here's rare communications insight from a company that has a serious communications problem -- Lehman Bros. Floyd Norris of the New York Times interviewed Erin Callan (coincidentally, right before she was replaced as CFO at Lehman) and she was unusually candid about the challenge a CFO faces in communicating with investors and media. “Trying to strike the right tone, to tell what really happened, what are the facts, and trying to give some confidence to your stakeholders, is a difficult process,” she said. “You don’t always get it right.”...“People are telling us they want to know more. They are not comfortable with what they know,” Ms. Callan said. “It’s a hard thing to figure out what that line is. How can we give a requisite amount of information that is satisfactory?”

That last question is hard to answer for any bank, right now. However, Lehman is in an extraordinarily difficult position, reputationally, as a result of its refusal to take the writedowns its peers have, become more transparent about the quality of its balance sheet, and become more proactive in its investor relations. Maybe the CFO and COO won't be the only members of the c-suite to pay the price.

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