Thank you, Dean Robertson, for that introduction.
And congratulations … to the graduates … to your parents … to your significant others … and to all of your friends and supporters here today. You all have much to be proud of.
Today you join a long list of distinguished alumni from this proud institution—America's first and, still, its premier business school. While I went to the second-oldest business school in the country—I have tremendous respect for Wharton. Citi recruits many Wharton grads every year. Twenty-five of you from this class … and another 67 Wharton undergraduates … are joining Citi. And we haven't given up on the rest of you.
I also congratulate you on your excellent timing. You probably chose the best two years of the last two decades to be in school. It was a great time to study the key issues facing the American and global economies. The only way to have learned more is to have lived it—an experience, that I can assure you, was not one of pure enjoyment.
Over the last two years, I too received a great education, facing crises and making decisions—many of them very difficult.
People often ask me: what prepared me to make these decisions? Certainly, I had no formula. There were no courses or case studies that I could look back on for the answers. The problems were too new, too unique, too complex, and too fast moving for that.
Yet I also had a whole career to look back on … a series of decisions that got me to that point. Those decisions were not necessarily made with foresight. I never planned my career. I made the decisions that made the most sense at the time. I cannot say that those decisions in and of themselves prepared me for what lay ahead. But they did hone my instincts and impart confidence in my judgment. And I thought that I would share some of them with you today.
The first important career decision was to determine what I really liked. Like any good Indian son, I was going to be a doctor or an engineer. I'm sure some of you can relate to that expectation. I chose engineering. I learned two things very quickly. I wasn't passionate about it. And I wasn't great at it.
I switched to finance and stuck with it through a master's and then a Ph.D. The next logical step was teaching. But I wasn't much better at teaching than I was at engineering. More importantly, I found that passion for the subject matter didn't translate to passion for teaching it. I was much more interested in practice than in theory.
That led to my second big decision—where to go next? I knew that leaving academia for Wall Street would be a risk. I already had a teaching job at a major university and—as your professors can tell you—those jobs are coveted and hard to get.
I had to get this right. I needed to find the right company with the right culture. I joined Morgan Stanley in 1983, attracted above all by its culture at that time.
In those days, the company was very small—only 2,500 people. It was still a private partnership, which meant that all the senior bankers put their own money on the line every day—they had skin in the game. The whole purpose of the firm was focused on one thing … and one thing only: serving clients.
Bankers were hired for the long term—it was not a place to put in two years and move on. Hiring meant making a long-term commitment to an employee. There was an apprenticeship model of training. No one was ever left alone to sink or swim. Every process was collaborative. Yet we were also trusted, and given the freedom and responsibility to succeed without micromanagement.
The atmosphere was intense without being dog-eat-dog competitive. People helped each other succeed. It became clear over time who thrived in the firm's culture and who didn't. It was a true meritocracy.
Two things mattered above all: integrity and quality. Was our work guided at all times by the best interests of the client? And was it absolutely first-class in every respect?
I rose to become the head of the syndicate desk. When companies wanted to go public, I wanted the deal. I priced a number of transactions, from the IPOs of Netscape, Compaq and Cisco, to major capital raises for GM and IBM.
I became used to posting my own results and being accountable only for myself. But soon I faced a third key turning point. Would I remain an individual producer or would I take on the responsibility of producing the producers? Could I groom and manage my own team … and take pride not in my own achievements but in what others achieved?
There was only one way to find out. It required stepping out of my comfort zone, which can be risky—and scary. But I did it—I accepted the job as head of the derivatives business. Managing people is so much more complex than managing projects. It's also a lot more rewarding … and a lot more conducive to personal growth.
The fourth key decision was the hardest of all. I spent nearly all of my working life at Morgan Stanley. I was told that I was being groomed for the top job. Morgan Stanley eventually acquired Dean Witter and I became President of the part of the company that constituted the old Morgan Stanley businesses.
The problem was that the merger had changed the culture of the company. My vision was too different from what the company was becoming. I wanted to emphasize what I thought was the best of Morgan Stanley's talent-based, entrepreneurial culture. The company, on the other hand, seemed to be headed in a more process- and product-driven direction.
I don't doubt that had I stayed, I would have been successful to all outward appearances. But that was not the company I wanted to run.
So I left and started a business with a talented team of partners with whom I had been working for years. Our business was soon acquired by Citi. We were thrilled to become part of a 200-year tradition and to join the only bank active in virtually every country in the world.
When the troubles at Citi started to become apparent, the CEO asked me to take over Citi's Institutional Clients Group, essentially the same businesses I had run at Morgan Stanley, plus a few more, and much bigger.
That is not what I what I had come to Citi to do.
But I could not say no—the fifth decision I want to share with you today. And the reason was simple. When the boss asks you to do something, you can't refuse—unless it's unethical or simply wrong for you. This wasn't. The team needed me in that role at that time.
So I accepted the role. It didn't last long. In a very short period of time I faced another decision—the most important of my career. I was offered the job of CEO of the whole company. This time there was no question that I would do it … because I was confident that I knew what needed to be done.
To recap very briefly for those who may not be familiar with the story, I became CEO of Citigroup in December of 2007—a bit like becoming captain of the Titanic after the ship hit the iceberg.
First, we needed to come up with a plan. We took a clear look at our company's DNA and core strengths and at the future of financial services. From there, it was a short step to understanding what parts of the company made sense for Citi's future and which businesses would better thrive elsewhere. We formulated a clear and credible plan—return to our roots, get back to the basics of banking, put clients at the center of everything we do, and sell of non-core businesses—and we stuck to that plan.
We've had to be resolute in staying the course. We were second-guessed from the outside—and sometimes from the inside—almost continuously. The temptation to swerve from the plan was at times overwhelming. But we did not. If we had, I would not be standing here today.
The rough seas—rising to a typhoon in late 2008 and early 2009—lasted two years. We needed significant help from the American taxpayer to survive. But we made it.
Citi is now profitable and has been for five straight quarters. We're a much leaner company, one completely focused on serving clients. We've shed nearly $500 billion in assets without compromising our global presence in 101 countries. And we repaid, with gratitude, the taxpayers in full—earning them a $12 billion profit on their investment.
Lessons from my own experience are very simple … almost truisms … and nothing you haven't heard before … but worth internalizing.
Find your passion and follow it … choose the right company and culture … don't fear leaving your comfort zone … have the courage of your convictions … and stay the course.
As you graduate, you are entering a business world that is in some ways very similar to the one I found in 1983 … and in other ways very different.
While the financial services industry is much larger today, I believe it looks more like the industry of 1983 than that of 2008. It's more focused on its core strengths and serving clients. In many ways, we are getting back to that same culture that excited me in 1983. And we are instilling that culture every day at Citi.
The wider world, on the other hand, is completely different. When I started, the domestic market was everything. Japan and Western Europe mattered, too. But nowhere else. It was a hub-and-spoke world and New York was the ultimate hub.
Today we live in a networked world. All roads no longer lead to a few key hubs. They lead everywhere. Emerging economies can trade with each other without ever having a single banker, CEO, or government official set foot in New York—and do quite well. So much of the action is happening away from the old centers.
Your careers will be defined by massive trade and capital flows within emerging markets, explosive growth in new consumer blocs as the global middle class grows, and increasing digitization—things few if any of us were thinking about in 1983. Ideas find support from capital more quickly than ever, which makes entrepreneurship more accessible than ever. More ideas to choose from mean more complexity … and more opportunities to choose wrongly.
It's a more exciting world—but also more complex. I had to adapt to it over the course of a career. You have grown up with it. That gives you an advantage. Use it wisely.
Thank you and congratulations again.