Lehman Brothers: the company as it saw itself

One innovative firm, committed to unrivalled partnerships, trading platforms ... and the 'highest risk management standards'

The collapse of Lehman Brothers last week and the US government’s massive US$85 billion bailout of AIG show this financial crisis has a way to roll yet.

The turmoil and uncertainty will have an impact on IT spending and IT jobs. It will also almost certainly impact on New Zealand in some unforseeable ways.

However, this piece isn’t really about that. Shortly after the collapse I took a trip through Lehman Brothers’ website to get a feel for how the company saw itself. It was a proud old company and a fairly straight one for most of its existence.

But reading its site left a very odd aftertaste. It was a bit like a police murder scene after the body has been removed.

Here’s Lehman’s mission statement:

“We are one firm, defined by our unwavering commitment to our clients, our shareholders, and each other. Our mission is to build unrivaled partnerships with and value for our clients, through the knowledge, creativity, and dedication of our people, leading to superior returns to our shareholders.”

How many times have you read similar drivel? Why hasn’t someone taken it down and buried it in a deep, deep hole?

Lehman’s was an innovator:

“Lehman Brothers, an innovator in global finance, serves the financial needs of corporations, governments and municipalities, institutional clients, and high net worth individuals worldwide. Founded in 1850, Lehman Brothers maintains leadership positions in equity and fixed income sales, trading and research, investment banking, private investment management, asset management and private equity.”

And it was at the forefront of technology:

“We continue to invest in our infrastructure, enhancing our trading platforms and ensuring the highest risk management standards. As our clients continue to seek opportunities beyond their home markets, we look to combine local expertise with a superior global infrastructure. This strategic combination has led us to hold top market share positions across major markets globally.”

And it could be trusted:

“As a trusted partner, we provide comprehensive financial advisory, capital raising and risk management services to corporations and governments worldwide. Extending our global presence and capabilities, we continue to develop innovative and tailored solutions to deliver the full resources of our Firm to our clients.”

I’m not really down on Lehman Brothers, but rather the perverted, greed-driven system that created this crisis and the regulators and government that, over many years, failed to call it.

As always, the victims are, or will be, the little people: middle-class struggling taxpayers whose money will now go into these massive bailouts, and all those who lose their jobs either directly or indirectly as our global economy falters. People who never chose to invest in companies such as AIG are now having that decision made for them.

When Barclays bought Lehman Brothers last week, Lehman’s chairman and CEO Richard S Fuld Jr, called it a “wonderful outcome for a great number of our employees that will preserve and strengthen our terrific franchise.”

Somebody build a statue to that man. The company’s HQ and two datacentres fetched US$1.45 billion. Its entire North American business went for just US$250 million.

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