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News and Press Releases |
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HEADLINE:
Corporate Integrity Key In Economy-Fed's Santomero
By: Staff Writer - Reu
Forbes.com. February 24, 2003
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NEW YORK (Reuters) - Philadelphia Federal Reserve Bank President Anthony Santomero said Monday that good corporate governance is critical to the health of the U.S. financial system and the economy. "Our economy will be stronger if corporate decisions are made with competence and integrity, and if shareholders and the public can appropriately assess the profitability and riskiness of corporations' business activities," Santomero said in the text of a speech prepared for delivery at Wilkes University, Pennsylvania. He did not discuss the economic outlook or monetary policy in the speech, which was held at a "Corporate Governance and Responsibility" seminar. "Good corporate governance is critical to the health of the corporate system, our financial system, and our economy," Santomero said. He said the Federal Reserve has had some success with the evolving model of corporate governance in its experience as regulator of the U.S. banking system, by stressing a broad assessment of risk and internal controls. "For instance, despite the economic downturn in 2001, most banks continue to be in good health," Santomero said. He does not have a vote on the Fed's policy-making committee this year. To restore public confidence in the integrity of corporate America, companies had to show a strong commitment to rigorous standards of corporate governance, the central banker said. He cited a recent poll that found 77 percent of the public believes CEO greed and corruption caused the recent stock market declines. "Yet, the continued success of our economic system requires the confidence and trust of investors, employees, consumers, and the public at large.
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