College Park, Md. – November 5, 2009 — The University of Maryland’s Robert H. Smith School of Business launched the new Center for Financial Policy on Nov. 2 with a roundtable discussion on the hotly debated issue of “Executive Compensation—Practices and Reform.” The Center for Financial Policy offers an unbiased source of expertise on complex policy issues related to financial institutions, financial markets and public companies through cutting edge education and research. The center intends to interact with policy makers to provide impartial help in steering and influencing policy.
The Washington, D.C., roundtable event featured keynote speaker Kenneth Feinberg, Special Master for Compensation of the U.S. Department of the Treasury. He described the underlying rationale behind the recently determined compensation packages for the 25 top executives at seven firms that received more than one round of federal bailout funding. Two panel discussions allowed the almost 200 participants, mostly high-level executives from the public and private sectors, to explore best practices and reforms and engage with experts in the field through question-and-answer sessions. Daniel Tarullo, Governor of the Federal Reserve Board, wrapped up the day with an announcement that the Fed will begin gathering information from large complex banking organizations regarding their pay practices, as a first step toward increasing involvement in setting compensation guidelines.
The roundtable was one of several events this fall that launched the center, an important initiative of the Smith School designed to mobilize Smith faculty to address critical issues in the complex world of financial markets.
“The financial crisis highlighted the need for a broader, interdisciplinary perspective to addressing financial policy and corporate governance issues,” said Lemma Senbet, the William E. Mayer Chair Professor of Finance and director of the Center for Financial Policy. “Our hope is for government financial regulatory agencies, congressional staffers, industry associations, and corporations to look to the center as a partner and champion of best practices in the financial arena.”
Senbet heads the center as director and is joined by managing director and Tyser Teaching Fellow Clifford Rossi, an industry leader with nearly 25 years experience in banking and government, most recently as Chief Risk Officer for Consumer Lending at Citigroup where he was intimately involved in TARP funding and stress tests performed on Citi. The center’s leadership is rounded out by finance industry veteran William Longbrake, the executive-in-residence and senior policy advisor who joined to work on a variety of business, policy, and governance issues with faculty, students, business leaders, government policy-makers, and executives of not-for-profit organizations.
Located in Washington, D.C., at the Smith’s School’s campus in the Ronald Reagan Building and International Trade Center, the Center for Financial Policy is well-situated to take a leadership role with its globally recognized faculty and its extensive relationships with key policy-makers, practitioners and academics.
“It is important to have deep thinkers involved in the development of policy, people who are not under pressure to further anyone’s political agenda or are affected by the political consequences of the outcome,” says Smith School Dean G. “Anand” Anandalingam. “The challenge for all of academia is to make its voice heard within the corridors of power, alongside the many other voices competing for attention.”
The center will encompass the broad range of research in which Smith faculty are already world experts, focusing on areas related to six distinct areas: corporate governance, led by Senbet; financial institutions and corporate finance led by Haluk Unal, professor of finance; emerging capital markets, led by Vojislav Maksimovic, Dean’s Chair Professor of Finance; asset valuation and markets, led by Albert “Pete” Kyle, Smith Chair Professor of Finance; money management, led by Russ Wermers, associate professor of finance; and risk management, led by Alexander Triantis, professor of finance and finance department chair, and Cliff Rossi, the center’s managing director.
The Center for Financial Policy will host a regular speaker series to explore financial policy and corporate governance issues. The center will also host the yearly Directors’ Institute, an intensive two-day program for board chairs, corporate directors and senior executives of publicly traded companies to address critical issues facing corporate boards. The inaugural program will be held April 7-9, 2010 in Washington, D.C., run by Director Stephen Wallenstein, senior fellow of finance and a recognized expert in corporate governance and best practices for publicly traded companies in the U.S. and abroad.
About the University of Maryland’s Robert H. Smith School of Business
The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 13 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and part-time MBA, executive MBA, executive MS, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia.