Sunday, August 18, 2019
Citigroup Inc. :: Business, Global Bank
This reflection paper analyzes Citigroup IncÃ¢â¬â¢s initiatives to set funds aside for executivesÃ¢â¬â¢ performance pay, how they are interacting with the media, and business tools that could improve the transparency of their compensation system. Citigroup is a global bank with its headquarters in New York, NY (Citigroup, Inc., 2011). Citigroup received a U.S. government bailout two years ago (Hester, 2009) and has been operating strongly since then. This June Citigroup announced that it will be putting 86 million for the quarter into paying bonuses to key executives. The announcement was made by CitigroupÃ¢â¬â¢s company spokesman Jon Diat (Scheer & Eichenbaum, 2011). The mandatory regulatory filing was filled out to where it addresses the possible recipients of the bonuses as merely Ã¢â¬ËkeyÃ¢â¬â¢ employeesÃ¢â¬âno names were given and the number of possible recipients was withheld as classified information (Scheer & Eichenbaum, 2011). A few possible recipient names were revealed to the media. CitigroupÃ¢â¬â¢s (Citi) compensation beliefs are good because they understand that executives need to be financially recognized for their achievements. The following quote is an example of how companies can fail to financially recognize employeeÃ¢â¬â¢s achievements. Ã¢â¬Å"An employer may not fire a worker if this would violate an implied contract, such as a verbal promise, or basic rules of Ã¢â¬Ëfair dealing.Ã¢â¬â¢ For example, an employer could not legally fire a salesperson just because he or she had earned a bigger bonus under an incentive program than the employer wanted to payÃ¢â¬ (Lawrence & Weber, p. 369, 2011). The quote above explains how a company can set up a compensation system and then fire employees that successfully reach the top pay within that compensation system. Executives may experience similar treatment from stockholders, with the exception that stockholders do not create the compensation system. Stockholders can exude massive public ridicule. If a corporation accepts the criticism of stockholders and organizations they may be viewed as wanting to fire the executive that has accomplished preset goals. Citi is keeping the some of the profit-sharing candidatesÃ¢â¬â¢ names confidential. An important aspect of protecting the interest of stockholders is to keep the company as transparent as possible (Lawrence & Weber, 2011). Citi should reveal all names of the executives that may earn bonuses from the profit-sharing programs. Investors may want to know about who is and is not a part of the profit-sharing program; they may also want to know why the participantsÃ¢â¬â¢ names are being kept confidential.