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T ORG. GE FALL/WINTER 2009 aidY 931 the Alumni Magazine of NYU Stern STERNbusiness AMID COMMERCE AND CULTURE

The Global Alumni Conference Meets in Barcelona

Henry Kaufman’s Words of Wisdom ■ Volkswagen’s US Strategy ■ The Faculty Band ■ Revlon’s New Boss ■ A New Dean in the New Year ■ Three Takes on Managing in a Recession 185769_KA_printerSpreads_R1.qxd:SternMag09fallSpreads.qxd 10/13/09 9:08 AM Page 4

a letter fro m the dean

The past six months have different angles. Steven Blader describes how employ- produced enough “green ees can be motivated by something other than money, shoots” in the global econo- a most helpful insight these days (page 24). Dolly my that it is reasonable to Chugh shows, disturbingly, how if people think they hope an economic spring is may suffer a loss, they have a greater tendency to in the offing. It is gratifying engage in unethical behavior (page 26). And Gina to think that the book of Dokko examines how employees’ prior experience white papers our faculty cre- doesn’t necessarily work to their new employers’ ated, which was published advantage (page 28). by Wiley in March under the title Restoring Financial Most imminently, the School is preparing to wel- Stability: How to Repair a Failed System, may have come its new dean, Peter Blair Henry, currently the influenced key policy measures taken by our nation’s Konosuke Matsushita Professor of Economics at lawmakers to address the financial crisis. I am proud Stanford University (page 20). Dean-designate Henry of our School’s continuing contribution to this critical will assume his new role on January 15, 2010. national dialogue. I am delighted with the appointment of Peter This level of intellectual product from our com- Henry, whose multi-faceted background encompasses munity is, of course, one reason why NYU Stern has scholarship, administration, and public policy. A become a preeminent school of business education. In Rhodes Scholar, he is a charismatic leader as well as this issue, we highlight more examples of the vitality a creative and productive scholar, whose research of our campus, actual and virtual. Henry Kaufman focuses on the impact of economic reform on emerg- (BA ’48 (Heights), PhD ’58), for whom our main aca- ing economies. He led the Obama Transition Team’s demic center is named, answers questions about his review of the International Monetary Fund, World life and his vision of the world – its risks and its Bank, and other international agencies, and has promise. Kaufman’s third book, The Road to advised governments from the Caribbean to Africa. Financial Reformation: Warnings, Consequences, Professor Henry’s contributions in the arena of Reforms, was published in August by Wiley (page 16). public policy are numerous and will serve to advance Last spring, at our conference, “Bankruptcy and the work that we have begun, positioning NYU Stern the Financial Crisis,” President of the Kansas City at the intersection of business and society. I am confi- Federal Reserve Bank Thomas Hoenig’s keynote dent that he will be a strong advocate for our many speech drew a lot of media attention (page 3). Stefan areas of excellence and that the School will continue Jacoby, president and CEO of Volkswagen Group of to thrive under his leadership. America, touched on bankruptcy in his discussion of At our Global Alumni Conference in Barcelona the global auto industry and then presented an inter- last June, we were treated to exciting progress reports esting vision of the future of transportation (page 18). on NYU as the Global Network University (page 12). John Demsey (MBA ’82) of Estée Lauder led an After It is our alumni who carry Stern’s reputation into the Market Hours event, sharing his insights on manag- farthest corners of the globe, and we are always ing through these turbulent times (page 4). proud of your accomplishments and grateful for your We also include in this issue excerpts of several continued support. It has been my great privilege to research papers by our faculty that I think you will serve as dean, and I look forward to remaining a vital find intriguing. Viral Acharya (PhD ’01), a co-editor part of the Stern community as I return to teaching of Restoring Financial Stability, poses an interesting and writing. hypothesis about what he calls the internal gover- nance of firms – a situation wherein employees who have the firm’s best interests at heart provide a strong counterweight to a self-interested or myopic CEO (page 30). Also in the management area, we have Thomas F. Cooley grouped excerpts from three separate papers that Dean come at the topic of “Managing in a Recession” from 185769_KA_printerSpreads_R1.qxd:SternMag09fallSpreads.qxd 10/13/09 9:10 AM Page 7

STERNbusiness A publication of New York University Stern School of Business

contents FALL/WINTER 2009 President, New York University John E. Sexton 2 Public Offerings The 2009 Haskins Award honors Judith Rodin; Stern faculty ring out NASDAQ’s Dean, NYU Stern School of Business trading day; the Volatility Institute is launched; Estée Lauder’s Demsey talks man- Thomas F. Cooley agement at an After Hours event; the Directors’ Institute debates board oversight of risk management; a NERA roundtable ponders the future of securities litigation Vice Dean and Dean of the 7 Stern in the City Undergraduate College 7 Gretchen Shugart gets a standing ovation for TheaterMania.com, By Jenny Owen Sally Blount 9 Alan Ennis of Revlon takes a by-the-book approach to managing, By Rika Nazem Chairman, Board of Overseers 11 Cover Story – Amid Commerce and Culture William R. Berkley The Global Alumni Conference provides a forum to discuss the financial crisis, family businesses, indie films, urban planning, and NYU’s Global University – Chairman Emeritus, Board of Overseers while enjoying the vibrant culture of Barcelona, By Joanne Hvala Henry Kaufman 16 The Oracle of Wall Street Speaks His Mind 10 questions for Henry Kaufman Chief Marketing Officer Beth Murray 18 Leading Indicators Stern’s CEO Series: Volkswagen Group of America’s Stefan Jacoby talks about Associate Dean, Marketing VW’s US strategy, global manufacturing, branding, and alternative energy sources and External Relations Joanne Hvala 20 Prospectus Faculty appointments, awards, honors, and noteworthy papers Editor, STERNbusiness Marilyn Harris Office Hours – Faculty Research Managing Editors, STERNbusiness 23 Managing in a Recession Rika Nazem and Jenny Owen When the Going Gets Tough: A Trio of Papers New research into organizational behavior provides insights into what makes Contributing Writers employees tick, why people make ethical missteps, and the pros and cons of Keith Layton, Angela Parks, hiring for experience Carolyn Ritter, and Joey Schmit 24 How to Inspire Motivation By Steven L. Blader Illustrations Janusz Kapusta 26 Bad Behavior Ken Orvidas By Mary C. Kern and Dolly Chugh Christophe Vorlet Christopher Zacharow 28 Unpacking Prior Experience By Gina Dokko, Steffanie L. Wilk, and Nancy P. Rothbard Design 30 Keeping the CEO in Line Anne Sliwinski Internal governance can curb a wayward boss, By Viral V. Acharya, Stewart C. Myers, and Raghuram G. Rajan Letters to the Editor may be sent to: 34 Peer to Peer NYU Stern School of Business Student Life in Washington Square and Beyond: Recruiting trek to Abu Dhabi and Office of Public Affairs Dubai explores economic and cultural opportunities; First group of Indian students visits Washington Square from Mumbai in new exchange program 44 West Fourth Street, Suite 10-160 New York, NY 10012 36 Alumni Affairs www.stern.nyu.edu/sternbusiness Alumni News and Events: More from the Global Alumni Conference in Barcelona, [email protected] Stern’s top alumni ambassadors, NYU Alumni Day, and a new online alumni community 40 Class Notes

48 Past Performance Coming to your iPod soon? The 20-year-old Stern faculty band is a rock’n’roll’n’jazz juggernaut that sets School functions on fire, By Marilyn Harris

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NYU STERN CELEBRATES THE IMPACT OF Stern Board of EDUCATION AT THE HASKINS AWARD Overseers, spoke about the impor- DINNER tance of educational On April 28, nearly 220 NYU Stern institutions and alumni and friends gathered for the 2009 their impact on Haskins Award Dinner at the Mandarin society. Oriental hotel in New York City. The gather- Dean Cooley ing celebrated the support of Stern’s most thanked the audi- dedicated and generous alumni, faculty, and ence, specifically friends over the past year and highlighted the leadership of the importance of making an impact on the Board of society through education. Dean Thomas F. Cooley (right) and William R. Berkley (left) honor Judith Rodin with the 2009 Charles Waldo Haskins Award at a celebratory dinner in April. Overseers, Dean’s At the event each year, the School Executive Board, bestows the Charles Waldo Haskins Award on an out- and Alumni Council, for their generosity to and continued standing individual whose career has been characterized support of NYU Stern. He also noted the recent media by the highest level of achievement in business and pub- attention surrounding the School: “People are finally dis- lic service. This year, NYU Stern Dean Thomas F. covering that Stern is an incredibly important institution Cooley presented the award to Judith Rodin, president that contributes to business and the world at large.” of the Rockefeller Foundation and former president of To highlight the media attention and the School’s the University of Pennsylvania. most recent success – the faculty’s creation of a book of In her acceptance speech, Rodin spoke about the rel- white papers entitled, Restoring Financial Stability: evance of innovation to the current economy, as well as How to Repair a Failed System, as a response to the the power of ideas shared across national, institutional, current financial crisis – alumni viewed a short video and disciplinary boundaries. The current economy, she that presented highlights of professors across all Stern said, has created a “once-in-a-generation chance for departments who were interviewed on leading television innovation in every sector; it has never been more and radio outlets and who either authored or were cited important.” Rodin shared her insights on collaborative in articles in top magazines and newspapers discussing thinking and her experiences as the first woman to lead the economic crisis. Visit the website at the Rockefeller Foundation. http://w4.stern.nyu.edu/events/podcast/sizzle.html to William R. Berkley (BS ’66), chairman of the NYU view the video.

On May 14 at Radio City Music Hall, Raymond Odierno (left), Commanding General of Multi-National Force-Iraq and father of graduating MBA student Anthony Odierno (MBA ’09), delivered the keynote address to students receiv- ing advanced degrees at Stern’s Graduate Convocation ceremony. Alumnus Thor Bjorgolfsson (BS ’91) (right), an Icelandic entrepreneur, delivered the keynote address at the Undergraduate Baccalaureate ceremony held for Stern’s

Photo: Zef Nikolla//Printroom.com Photography undergraduate business college later that afternoon. General Odierno spoke about leadership and service to the community and country and the value of Dean Thomas Cooley and 15 co-authors of Restoring Financial serving higher goals, and Bjorgolfsson spoke about the need for staying positive Stability: How to Repair a Failed System rang the closing bell at NASDAQ and opportunistic in bleak economic times and for looking for the silver lining. on April 14. The book, published in early March, is a collaborative effort of New York University officially conferred its degrees during an All- 33 NYU Stern professors to provide an in-depth analysis of and specific University Commencement ceremony at Yankee Stadium on May 13, where policy recommendations for solving the current financial crisis and avoid- Secretary of State Hillary Rodham Clinton delivered the major address. ing another one.

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of NYU STERN OPENS NEW VOLATILITY INSTITUTE “The economic crisis ed to has put a spotlight on the ales Fox NYU Stern announced the launch of a new research importance of calculating center, the Volatility Institute, created under the leader- and managing risk effec- ship of the School’s Nobel Laureate Robert F. Engle, the tively,” said Engle. “The Michael Armellino Professor of Finance at Stern. Engle, forecasts coming out of whose volatility research garnered the Nobel prize, intro- our Volatility Lab will spe- duced the Institute’s Volatility Lab, called Vlab for short, provide risk managers yee- which measures and forecasts financial volatility and cor- Robert Engle debuted Stern’s Volatility Lab at the and regulators with alter- NY. relations in real time for a wide spectrum of assets, Volatility Institute’s inaugural conference in April. native and independent Y, was including equities, exchange rates, commodities, and measures to assess the state of the financial markets on ui is a bonds. The Vlab currently produces 300 analyses each an up-to-the-minute basis.” The Institute hosted its in day over numerous financial series using both classic first conference for researchers and the business com- models as well as some of the latest advances proposed in munity on “Volatilities and Correlations in Stressed financial econometrics literature. Markets” in April. New cently FED’S HOENIG CRITICIZES ADMINISTRATION’S APPROACH TO TOO-BIG-TO-FAIL INSTITUTIONS of In his keynote address, Hoenig Stern Finance Professor Matthew point At the NYU Stern Salomon Center chairman of Rothschild North conference on “Bankruptcy and the America, clinical professor, and rejected the notion that some firms Richardson, addressed how to deal Financial Crisis” in June, Kansas City member of Stern’s Board of are too big to fail and criticized the with the failure of large banks. Roubini was Federal Reserve Bank President Overseers; and Myron S. Scholes, government’s ad hoc approach. “With said that receivership is the best and too-big-to-fail, capitalism is compro- approach to adopt with insolvent l Thomas M. Hoenig spoke out against chairman of Platinum Grove Asset the government’s current stance on Management. mised and equity of opportunity is firms, because it minimizes taxpayer large financial institutions. Facing a The first panel, moderated by sacrificed to expediency,” he said. He losses, reduces moral hazards, offers w packed room of practitioners and Stern Stern Dean Thomas F. Cooley, dis- laid out a three-step plan to address clear guidelines and protocol, and r of MBA students and alumni, Hoenig cussed creditors’ rights, with the troubled, large institutions, namely, provides a faster means to divest from ent of offered alternate solutions for manag- Chrysler-Fiat merger a case in point. creating one set of “easily understood the institution. However, he stressed, ive ing too-big-to-fail firms. Two expert Adler called the deal “a reorganiza- and enforceable” rules of performance “The most crucial criterion for decid- panels included Stern Professors tion in the guise of a sale,” arguing for institutions with systemic impor- ing if you want to go through forbear- that the government’s actions were tance; defining a plan of attack for ance, or a bailout, is deciphering of Edward Altman and Nouriel Roubini; tal William Ackman of Pershing Square inconsistent with bankruptcy laws. firms in this category; and holding whether the institution is illiquid or st, Capital; Barry Adler, professor at NYU Altman predicted the demise of managers and stockholders of failed, insolvent.” Hoenig’s remarks and curity School of Law; Michael Krimminger, Chrysler within five years and argued large firms accountable for their streaming videos of the event are ly special policy advisor of the Federal that the government’s unprecedented actions, replacing management for the available at: Deposit Insurance Corporation; Gerald actions in bailing out the auto indus- resolution process. www.stern.nyu.edu/bankruptcy_confer ch Rosenfeld (PhD ’73 (Heights)), deputy try are rewriting the bankruptcy code. The second panel, moderated by ence. and Ennis A ROUNDTABLE WITH THE ASPEN INSTITUTE ADDRESSES FINANCIAL MARKET REGULATION In June, NYU Stern and The Aspen Institute, with sup- Participants explored a number of issues that they port from Ernst & Young, convened a group of 20 busi- agreed need to be resolved in order to revamp the US reg- an ness practitioners, including former senior government ulatory system, including: creating a systemic risk regula- earch officials, and business and law academics to discuss tor; pricing systemic risk; addressing the destructive search responses to the current economic crisis and to explore the potential of derivatives; international cooperation in creat- at role of financial market regulations in fostering economic ing regulatory and corporate governance requirements; s. recovery and growth. Among the participants were former adequate resources, talent, and enforcement capacity for Chairman of the SEC William Donaldson, NYU Stern financial market regulators; fostering and enforcing New Dean Thomas F. Cooley, and NYU Stern Professors accountability; the role and value of financial innovation; g William Allen, John Biggs, Bruce Buchanan, and a long-term focus among corporations; and attention to Lawrence White. the interests of long-term investors. Sternbusiness 3 185769_KA_printerSpreads:SternMag09fallSpreads.qxd 10/1/09 10:26 PM Page 12

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Group’ ALUMNUS JOHN DEMSEY Benetton, and Revlon before joining Estée Lauder in mental Omnic DISCUSSES MANAGING 1991 as West Coast vice president of sales. At the and co time, the firm was a privately held, family company ESTÉE LAUDER THROUGH that relied on five large, powerful brands. Today, Victor TURBULENT TIMES Estée Lauder is a publicly traded, multinational Estado CEO o organization with 29 brands and operations in 135 Aeropo In February, the NYU countries. In 1998, he steered the acquisition of known Stern Dean’s Executive Board MAC and was subsequently put in charge of the OMA’s hosted a select group of brand. “That’s when I really learned how to run and alumni and students for Frank brand a business,” he said. headin cocktails and conversation at Demsey described how the world is now more Stifel, an After Market Hours event monolithic, the consumer base more fragmented, Financ – part of a series highlighting successful Stern alumni and retail more vertically integrated. “Brand loyalty age an Oh wo – that featured alumnus John Demsey (MBA ’82), today means that consumers are loyal to four or five group president of The Estée Lauder Companies. At cosmetics brands,” he explained. “The average Matth the NYU President’s Penthouse, Demsey spoke can- woman uses 13 cosmetics brands.” Newca didly about the event’s theme, “Managing through Rather than competing on price as a long-term sors g Turbulent Times.” Manag strategy, he said, Estée Lauder is reframing its value firm’s c Demsey said the economy in 1982, when he gradu- proposition. Quality and longevity are key, as is sors. ated from Stern, was very similar to today’s. “There establishing emotional connections with consumers. were very few jobs. I took a job at Macy’s that I proba- Consumers are returning to brands they trust Patric bly wouldn’t have taken in fatter times. But there I Ridge, because they are not as willing to experiment, and as its C met some of the most talented and influential people he predicted this will work to Estée Lauder’s benefit Senior of my career.” He added, “It doesn’t matter where you because it has a long tradition of trusted brands. At and Ba start; it’s where you end up.” the same time, he asserted that innovation remains pharm Demsey worked also at Bloomingdale’s, Saks, critical. Brend Kisco, LLC, a NOBEL LAUREATE ROBERT LUCAS AND DEAN THOMAS F. COOLEY DEBATE Funds Royce, THE GLOBAL FINANCIAL CRISIS AT JAPAN-US CENTER EVENT hedge

Robert Lucas, Nobel Laureate and Shinsei Visiting or deposits lost. Still, the collapse of Lehman Brothers Susan Professor at NYU Stern, recently compared the global and other investment banks echoed that era. The Hills, N financial crisis to the Great Depression and Japan’s Obama administration is putting more reserves into the Advert Award “lost decade” at an event hosted by the Center for system and also acting as a lender of last resort, some- Advert Japan-US Business and Economic Studies in April. thing the government should have done in the 1930s, marrie Lucas was joined by Dean Thomas F. Cooley for an he asserted. The monetary policies taken by the cur- Presid informal conversation. rent administration are good central banking policies, Corpo Referring to the economic contraction from 1929 to he said. Carl D 1933, Lucas argued that the Hoover and Roosevelt Dean Cooley, less optimistic, said that the policy has has joi administrations should have increased the money sup- shifted the risk to the taxpayers and has gradually ment a ply to prevent deflation and increased spending, and by undermined the soundness of the FDIC. He explained Manag founde not doing so, prolonged the Depression. Japan, he said, that a time-consistent policy is one that will be sus- Partne experienced prolonged deflation during the 1990s, tained over a long period of time even as circumstances though not as severe as the US’s Great Depression. change, and pointed out the time-consistency challenge Russe Lucas noted that today, unlike in 1933, there the government faces in continuing to alter policy as CT, ha head o haven’t been commercial bank runs, flight to currency, circumstances change. Manag

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CEDER HOLDS WORKSHOP ON MANAGING BOARD MONITORING OF RISK MANAGEMENT AT CENTER OF Y, DATA RISK ana- NYU DIRECTORS’ INSTITUTE ously, In April, NYU Stern’s Center for The NYU Pollack Center for apital, Digital Economy Research (CeDER) and Law & Business, a joint initiative IBM Research hosted a workshop to bring between NYU Stern and NYU together leading practitioners and aca- School of Law, in May hosted its NY, demics to address strategies and tactics seventh annual Directors’ c that organizations can use to manage or Institute, entitled “Board ntly reduce data risk. The conference was gion. Monitoring of Risk attended by participants from top compa- deo Management.” Created to help nies and universities, including AT&T directors stay current on their Labs, Ernst & Young, IBM, JPMorgan legal, fiduciary, and ethical ng, Chase, Thomson-Reuters, and Yahoo!, tors of responsibilities, the Directors’ Richard Ketchum (left) and Joseph F. Tracy spoke about financial reform and the US economic outlook, respectively, at the Directors’ Institute in May. ased Institute was attended by more and Carnegie-Mellon University, sult- than 50 experts and practitioners in the fields but that a lot of savings are being used to Columbia University, and NYU Stern. dustry. of law, business, and regulation. reduce debt. Net worth has declined dra- The workshop’s co-organizer, Vasant nts, at William R. Berkley (BS ’66), chairman matically, and there remains excess invento- Dhar, professor of information systems e and CEO of insurance company W.R. Berkley ry in the housing market. Overall, however, and director of CeDER, said: ectors Corp. and chairman of NYU Stern Board of he argued that fiscal and monetary policy is “Organizations are collecting massive Overseers, opened the conference with working. amounts of data in order to make better set, remarks about board risks from an insurer’s The luncheon keynote address was decisions. Data are typically viewed as an busi- perspective. The current economic crisis has delivered by Richard Ketchum, chairman asset. However, experience reveals risks siness brought a new level of volatility, and, for him and CEO of the new FINRA – Financial ranging from high-profile losses in repu- personally, a heightened awareness of the Industry Regulatory Authority – who spoke tational equity due to data breaches to T, has risk of correlation. He argued that to deal about financial reform legislation in the US suboptimal day-to-day decisions due to with risk, managers need common sense, and abroad. He argued that the present erroneous or incomplete data.” ces of expertise, and critical eyes, in addition to financial turmoil creates opportunities and The program consisted of a keynote ial’s mathematical theory, and suggested the fol- suggested that regulators address the lack address, seven lectures by industry also lowing guidelines: Make managers risk-con- of transparency with over-the-counter deriv- experts, and a panel discussion on best on scious; have boards define companies’ risk atives, improve surveillance of the equity practices and existing gaps for managing tolerance; determine how to measure risk; markets, create legislation that establishes a data risk. w and have board members set parameters for clear set of principles, develop one over- of keeping them informed. sight body of investment advisors and bro- As part of Stern’s nergy Joseph S. Tracy, executive vice president ker/dealers, and resolve turf issues. Berkley Center for nd and director of research at the Federal The conference also featured panels ations Entrepreneurship & usly, Reserve Bank of New York, predicted that the that examined the board’s role in monitoring Innovation Himelberg ties, current economic downturn is likely to be the risk management, what every director Speaker Series, merica longest and deepest since the 1930s. He said should know about asset-backed securities Facebook co-founder production and employment continued to and credit default swaps, risk embedded in Chris Hughes addressed a select group of entre- asant, decline rapidly through March as the econo- succession planning and CEO compensa- preneurs from Stern’s student, faculty, and alumni my worked through an unusually large tion, and legal compliance risks in a crisis. communities. Hughes, now entrepreneur-in-resi- up. inventory correction, though inflation contin- It included expert panelists from the US dence for a venture capital fund, also met one-on- rivate ues to slow. While nominal income growth is Securities and Exchange Commission, the one with nine pre-selected semifinalist teams from declining, real income growth is increasing, Delaware Court of Chancery, and NYU Stern’s Annual Entrepreneurs Challenge to offer ir, NJ, boosted by drops in energy prices and taxes. Pollack Center for Law and Business, feedback on their venture ideas and explore invest- care, He noted that the personal savings rate is up among others. ment opportunities.

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Adding a regulatory perspective, John Roundtable participants (from left David Weintraub, senior vice president Hills, N to right) Brian Cartwright, Baruch and associate general counsel of Directo Lev, Elaine Buckberg, and Execut Seymour Jones discussed how JPMorgan Chase, predicted that while Crossi the economic crisis may affect the US has experienced a heightened securities litigation. regulatory environment for the last six Chery tion and other complex class years, the rate of response to issues NY, ha compa actions. He also questioned whether, from state regulators will speed up, PRACTITIONERS, ACADEMICS, AND RESEARCHERS their w as numerous banks vanish from the with more focus placed on hedge DISCUSS THE FUTURE OF SECURITIES LITIGATION scene, defendants will be around long funds and less on broker-dealers. He Naom “History shows us that economic perspectives on litigation and regula- enough for anyone to sue them. also forecasted increased scrutiny of has be VIPGif and financial upheavals expose tion. Jamie Levitt, partner at the law executive compensation in the finan- firm Morrison & Foerster, argued that cial services industry and the regula- incenti accounting scandals, executive com- Stephanie Plancich, senior con- to Fort pensation excesses, and audit failures. sultant of NERA Economic litigation stemming from the crisis tion of credit default swaps. VIPGif But the current crisis seems to be an Consulting, examined recent trends has occurred in waves – the first hit- Drawing on his experience as the Recog exception. Is it?” asked Stern Professor in securities class actions and high- ting the mortgage industry, followed general counsel for the SEC, Brian of Accounting and Finance Baruch Lev lighted a large dip in the number of by the financial industry, the ripple Cartwright posed several intriguing Willia effect, and the Madoff litigation, and questions: How high will filings go? Shorth at a recent roundtable discussion at federal filings in 2006. Attendees Somer next up will be the bailout lawsuits. Will a volatility defense work? Will a NYU Stern. questioned whether this dip was due, ent com In cooperation with the National in part, to the success of the Stern Assistant Professor of once-in-a-lifetime defense work? What was pr Economic Research Association Sarbanes-Oxley Act of 2002 (SOX), Accounting Mary Billings shared about the vanishing defendant? What LLC, a (NERA) Economic Consulting, the NYU which aimed to increase ethics in the some recent studies examining the about situations where the defendant Alan G Stern Vincent C. Ross Institute of corporate world. factors that influence the likelihood of is at risk of being nationalized? has be litigation. Clinical Professor of Accounting Accounting Research hosted a round- “Will the current economic and CF table entitled, “Securities Litigation: downturn provide a defense for Jan Larsen, consultant at NERA Seymour Jones said, in closing: “The recentl Will the Current Crisis Reverse the wrongdoers?” asked Stuart Grant, Economic Consulting, looked at subprime mortgage crisis spread all and CF Recent Downward Trend?” founding partner of Grant & recent trends in SEC settlements. Post over the world because other coun- Co-host Elaine Buckberg of NERA Eisenhofer, a national litigation bou- SOX, his data showed that the top 10 tries copied the US. The more stupid Micha Northp Economic Consulting introduced the tique firm that concentrates on corpo- settlements ranged from $250 million things we do, the more stupid things One H roundtable presenters, who shared their rate governance and securities litiga- to $800 million. we will pay for.” Macaw

Jame GREG MORTENSON DELIVERS 2009 ASHOK C. SANI Cliffsid Directo SCHOLAR-IN-RESIDENCE LECTURE Three Cups of Tea author Greg Mortenson spoke about his book to Editori In March, more than 600 alumni and guests gathered to hear Greg Stern students and alumni in August. Financ Mortenson deliver the 2009 Ashok C. Sani Scholar-in-Residence lecture, Senior solutio “Promoting Peace through Education.” Mortenson is the founder of the Central Asia Institute and Pennies for Peace, nonprofit organizations dedicated to pro- Kenne moting education in rural communities in Pakistan and Afghanistan, and is the Orange co-author of The New York Times bestseller, Three Cups of Tea, which was also Associ sulting Time’s “Asia Book of the Year.” Global Mortenson has dedicated a large portion of his life to promoting education Sperlin in remote and often volatile regions of Pakistan and Afghanistan. He has estab- Board lished more than 78 schools, providing education to more than 28,000 children, annual lecture made possible through the generosity of the family of the late Health including 18,000 girls. His work, however, has not been without extreme diffi- Ashok C. Sani (BS ’74), a successful entrepreneur, president of C.G.S. Micha culty – he has survived a kidnapping, firefights between Afghan warlords, two Industries Inc., a loyal supporter of NYU, and a founding member of the NYU Albuqu fatwahs, and a CIA investigation. As recognition for his work in support of glob- Stern Alumni Council. The Ashok C. Sani Distinguished Scholar-in-Residence as the al education and literacy, Mortenson will soon receive Pakistan’s highest civil Program shares with the NYU community his interest in ethics, truth, love, Chamb award, Sitara-e-Pakistan (Star of Pakistan). Zientek peace, non-violence, compassion, and the moral and social responsibilities of rate sh The 2009 Ashok C. Sani Distinguished Scholar-in-Residence Lecture is an members of society.

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stern City of InThe equity e as

es, s. TheaterMania’s Headliner Lucie, by Jenny Owen al , Inc., ec- At TheaterMania.com, there is an amazing vitality Crediting her Stern education with “setting me up for arkets of the dramatic arts showcasing across the US. everything I’ve done since,” Shugart finished her degree in de, Broadway shows are just the appetizer in the feast of about two and a half years. After graduating, she spent 18 sly, entertainment that awaits – summer festivals, local years in corporate finance positions at Manufacturers playhouses, and opera abound, and TheaterMania.com Hanover Trust Company and Chase Bank (both now y, has has gathered it all in one website. The site provides list- known as JPMorgan Chase), Bank of Montreal, and ent ings, reviews, ticket information, and more for the Communications Equity Associates. nels, l lead majority of the shows in 40 markets around the coun- Shugart became acquainted with TheaterMania when televi- try. No surprise that the company, whose ad revenue the firm she had founded, eMediaCapital LLC, was el, grew 45 percent in the past magic. (recessionary!) year, has ative ture experienced steady growth Disney annually since its founding a Vice decade ago. The leading role nce of CEO at TheaterMania is being ably played by yn, Gretchen Shugart (BS ’82), e who joined the cast about a ble Life year after its debut. tion ers of Shugart was taken with rod- the performing arts early on. Raised in a family where the arts ranked high – her mother f New m is a concert pianist – Shugart moved to New York City at irm in the age of 18 to study the violin. Instead, she ended up pursuing a bachelor’s degree ectors in management and econom- ovider ics at NYU Stern. “I didn’t ufac- really want to be a violinist, I anu- just had an opportunity to r of mber come to New York and study nd it,” explained Shugart. “I love ers New York, and I knew I was never going to make a living of here playing the violin – there FO of are too many people who are a better. But I always Cutline tified enjoyed business.” Gretchen Shugart is CEO of TheaterMania.com.

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Josep brought on to provide investment banking advisory serv- OvationTix derives from licensing and ticket fees. Rockvi ices. “TheaterMania’s founders came to me about six While TheaterMania.com covers major US markets, Techno where months after they had raised money during the dot-com London, and Toronto, its home base of New York City – ture. P boom, and the money was starting to run out because headquarters are near the theater district – is its prime positio they were spending very fast to get scale. There was no market, because the city has the largest performing arts revenue yet, and, at the time, capital was drying up,” community. Shugart noted that being in New York offers Christ of Berk Shugart explained. “I became very involved in the com- many advantages, such as a sophisticated pool of ored as pany, trying to keep it alive, and the natural progression employees who love working in the arts and face-to-face Wome was for me to become CEO.” Working with the original opportunities with clients, who, if they aren’t located in Magaz investors, and bringing in new ones, the company was New York, visit often because of its significant industry Busine

able to raise more money, structured so that it was presence. Shugart said she views her job as “being the Tom M drawn down only as certain financial targets were met. conductor, the orchestrator, the facilitator: We have very New Y Within two years, the strong managers in the of Ame company became cash- “While most people think of theater just in company. A lot of (APFS Americ flow-positive. times, I’m just rein- terms of Broadway, TheaterMania saw the being In the fragmented opportunity to focus on the smaller shows forcing what the man- been a markets it serves, agers want to do, but I APFS s TheaterMania found its and theater companies ‘where the hun- have to tie together niche by serving as the dreds and hundreds of not-for-profit and editorial, technology, 198 portal for smaller pro- small 99-seat houses didn’t have anyone sales, customer serv- Micha ductions to reach a ice, finance, and mar- New Y mass consumer audi- paying attention to them and didn’t have a keting, and that of Bloo month ence efficiently and way to market their productions.’” requires that I facili- busine inexpensively. Around tate a lot of interde- 700,000 consumers visit the site each month. While partmental coordination.” Laurie most people think of theater just in terms of Broadway, In the decade her company has been in business, Brookl nized b TheaterMania saw the opportunity to focus on the small- Shugart said, the theater business has evolved. “There is Wealth er shows and theater companies, explained Shugart, a lot more collaboration happening – theater companies 1000 A “where the hundreds and hundreds of not-for-profit and are getting together and co-producing so that they can adviso small 99-seat houses didn’t have anyone paying atten- share the risk and the expense,” she pointed out. Kevin tion to them and didn’t have a way to market their pro- “Markets share shows back and forth more. Consumers Staten ductions.” The company also works with Broadway and have realized that they should shop around before get- Presid large scale productions at sophisticated venues like ting a ticket. And there is a lot more interactivity, trying Develo Radio City, Lincoln Center, the Kennedy Center in to make productions more fun for the audience and get- Delawa firm C Washington, DC, and A.R.T. in Boston. “But we’ve never ting them involved, like with ‘Hair’ and ‘Fuerzabruta’.” provid lost sight of the little guy,” assured Shugart. For its part, TheaterMania has recently launched a clas- agency TheaterMania is partly supported by ad revenue, not sifieds section for the arts industry and is developing new only from the performing arts but from unrelated adver- markets in English-speaking cities across the world. Carol York, N tisers who like its demographic of highly educated, afflu- Shugart also plays on a more intimate stage, as wife Blank ent, mature females. The company sells advertising on and mother. She and her husband and teenage daughter Estate its website and on its e-mail newsletters, which includes and son make their home in Westchester County, New rently s more than 600,000 subscribers who receive theater York. A classical music buff, she also enjoys taking her the Jew Manha information and special discount offers. Several years family on the road for vacations, which this summer Chang after launching TheaterMania, the company began included London and Barcelona. “I’m proud that I’ve Jewish developing a proprietary web-based ticketing system, been able to sustain my career for nearly 30 years while Kevin OvationTix, which is used by venues across the nation, also having a family and raising two well-adjusted kids,” Harbor including NYU’s Skirball Center. The revenue for she said. For Shugart, that’s the role of a lifetime. ■ Norwe

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5), of sident Going the Distance by Rika Nazem lobal in cently “Career progression disciplined decision-making.” He also credits d is is a combination of his Executive MBA experience for framing his two factors,” explained strategic thinking and approach to leadership. rom Alan T. Ennis (MBA “My Stern education equipped me with addi- AP ’02), “ability and tional tools to enable me to take the next e n opportunity. I believe career step. My approach is not unique, but I that my experience, believe that persistent and clear-minded application of that approach creates sus- of management style, and k, In ability have positioned tained, positive, forward progress,” he noted. ch the me well to take advan- His approach has proved itself in results. eality had tage of the opportuni- With Revlon’s executive leadership team, ties that have present- Ennis devised a business strategy for the ed themselves to me.” company in 2006 that included building and Digest The latest opportunity leveraging Revlon’s brands, improving the lobal for Ennis, as of May execution of the plans, enabling and develop- Vice 2009: president and ing the company’s human capital, strengthen- CEO of Revlon, Inc., ing the international business, and improving Alan T. Ennis leads Revlon, Inc. w York, the global cosmetics the operating profit margins, cash flow, and rd, the and beauty care company that includes well-known capital structure. “The successful execution of this strate- llege. rectors products such as Revlon Colorstay lipstick, Revlon gy has led to significantly improved profitability, reduced Age Defying makeup, the Almay line of cosmetics, debt, stabilized market share around the world, and, in ’84), ColorSilk haircolor, and Mitchum antiperspi- 2008, the generation of positive free cash flow and net ted rant/deodorant. income,” he said. Leading up to his role as head of the $1.37 bil- But with a tough econom- tx, lion, NYSE-listed company, Ennis was the company’s ic market, Ennis also recog- o PC. numbers whiz. He held various positions in finance, nizes the need for a balanced of including executive vice president and CFO, and led perspective on the long-term the international business, which, he said, “broad- growth of the brand. “Our ened my knowledge of the global cosmetics landscape strategy is long-term in as, TX, and gave me direct accountability to drive the inter- nature and remains appro- e most national organization to be more efficient and prof- priate for the current envi- ficer itable.” In 2008, Ennis was named to Treasury and ronment. We’re managing Risk magazine’s “Forty under Forty” list, which cited our resources carefully and ew him as having “leapfrogged” up the executive ranks remain aware of the econom- he LP. of the company. Ennis described his formula for suc- ic and competitive landscape EO, cess: “I focus on results, clear accountability, open that exists,” he explained. le communication, fact-based discussions, and timely, “The company has incredi-

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ble talent and capa- Ennis, with his wife, Michelle, and their children, (from left to right) yo bilities, broad geo- Timothy, Bridget, and Daniel, ran the graphic reach, strong 2009 EIF Revlon Run/Walk for Women. rep for global brands, including Revlon, and raises more than cla which is one of the $10 million annually in an most recognized support of women’s to brands in the world. health initiatives and the mu We continue to take fight against women’s so actions to enable the cancers. Proceeds from Fli company to become a past EIF Revlon stronger organization Run/Walks have funded jus while staying true to cutting-edge research, too our vision of provid- contributing to the wi or ing glamour, excite- development of the ment, and innovation breakthrough gene treat- mo ment Herceptin, as well as other targeted therapies, to consumers through high-quality products at ww affordable prices.” bringing new and innovative treatment approaches to The Revlon brand is truly global, with a presence women’s cancers worldwide. in more than 100 coun- In his free time, Ennis tries around the world. “Career progression is a enjoys running. He highlighted “Our key markets around combination of two factors,” that, while at Stern in 2001, “I the world include the US, trained for and ran the New Canada, Australia, South explained Alan T. Ennis, York City Marathon with a few Africa, and the UK. The “ability and opportunity. ” MBA classmates, including marketing approach is Noel Furniss (MBA ’02) and consistent country to country: a keen focus on innova- Mike Bergner (MBA ’02). It was a memorable event, tive, high-quality, consumer-preferred products; effec- coming so soon after the events of September 11, 2001 – tive consumer brand communication; appropriate lev- I can clearly recall Mayor Rudy Giuliani’s comments at els of advertising and promotion; and superb execu- the start of the race, where he said ‘Tomorrow, New York tion with our retail partners. The Revlon brand has a is going to be here. And we’re going to rebuild, and we’re 75-year heritage as the global, modern glamour color going to be stronger than we were before... I want the authority in color cosmetics,” Ennis said. people of New York to be an example to the rest of the In addition to its purely business concerns, Revlon country, and the rest of the world, that terrorism can’t has a long heritage that recognizes the importance of stop us.’ In 2002, my wife, Michelle, and I ran the NYC philanthropy. The Entertainment Industry marathon together with my brother, Michael, from Foundation (EIF) Revlon Run/Walk for Women is Ireland.” He met his goal of breaking four hours for a one such well-known effort. Launched in 1993 the marathon in the 2003 Chicago race with a time of 3 EIF Run/Walk is a bicoastal event that, each year, hours and 51 minutes. He and Michelle like to play golf draws huge crowds – which have included student and tennis and swim, as well as spend time with their members of the Stern Women in Business MBA club – three children, Bridget, Timothy, and Daniel. ■

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Amid Commerce and Culture

A Provocative Program at the Global Alumni Conference in Barcelona Ranges from the financial crisis to family businesses, film, and architecture

by Joanne Hvala

arcelona is a jewel with vibrant backdrop for the 6th Annual from 25 countries, convened to hear al many facets: gateway port Global Alumni Conference, held a series of interviews and panels the to the Mediterranean, sun- June 11-13 at the Casa Llotja, a that focused on the financial crisis w- drenched commercial capi- 14th century building that is now and its aftermath, as well as film, ive Btal, playground of wildly inventive the official home of the city’s architecture, and NYU’s visionary chefs, seaside landscape of fantasti- Chamber of Commerce, Industry, plan for the Global Network s cal Gaudi architecture. Last June, and Shipping. University. The alumni host com- this urban siren provided the Nearly 300 Stern alumni, drawn mittee, chaired by Juan Antonio

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T alum repr prog loca mem supp Samaranch-Salisachs (MBA ’86), economics at IESE Business School, policy. While unemployment is ter c increasing in the US, in Europe the assembled a stellar roster of provided a nuanced tutorial on the and speakers, many drawn from the financial crisis, describing the cur- welfare state is cushioning the R Barcelona and Spanish business rent situation, comparing and con- recession – a good short-term community. The Honorable Dr. trasting the effects on the real econ- strategy, he said, but in the longer the Josep M. Basañez, First Vice omy in the US and Europe, and out- term it could impair labor mobili- whi Chairman of the Chamber of lining the key elements needed for a ty and change. occu Commerce of Barcelona, who repre- sustainable recovery. Although men- Another perspective on the dire sented Barcelona Mayor Jordi Hereu tioning glimmers of hope, he warned financial crisis was given by Alfredo took i Boher, joined Dean Thomas Cooley of a deep, global recession that is Saenz, CEO of Banco Santander, its e in welcoming alumni and friends. having a different impact on differ- SA, the world’s largest branch bank, enga who was interviewed by Stern’s Roy ent countries, and that will have T Different Strokes long-lasting effects. Fiscal policy has Smith, Kenneth Langone Professor alum Keynote speaker Jordi Gual, chief responded more aggressively in the of International Business, in a economist at La Caixa, Spain’s lead- US, while Europe has been more “Chat with Financiers” segment of grad ing savings bank, and professor of cautious and reliant on monetary the program. Banco Santander had and men buti Beyond the Square – Stern and the Global Network nent has an NYU outpost where NYU students can spend a semes- (SW University ter or year abroad. Over the past two years, the university’s admin- fund Washington Square may be the first location that comes to mind istration has focused on creating an integrated network out of its of th when NYU Stern is mentioned, but in the coming years, Stern will be many international programs. “The question is how best to create tion part of a university that literally spans the globe. Stern’s participation the infrastructure,” Dean Blount said, to enable students to move not in the NYU Global Network University was the subject of Dean of the around the world as part of their education and to enable faculty to SWI Undergraduate College Sally Blount’s plenary session presentation, engage in the kind of scholarly exchange that enhances their areas pow stud with co-presenter Hilary Ballon, Vice Chancellor for NYU Abu Dhabi of expertise. I Initiatives. Dean Blount is also Advisor to the President and Provost At Stern, Dean Blount has spearheaded the School’s open-bor- enga for Global Integration at NYU, working with the heads of NYU’s global ders approach to undergraduate education. She has initiated sever- crea and administrative units to create the infrastructure needed to realize al curricular innovations, including two new global degree options and the university’s vision of creating a large-scale, globally networked – the World Studies Track, launched in spring 2008, and the BS in men research university. Business and Political Economy, launched this fall. Students in mat Seeds for the Global Network University were planted more than these unique degree tracks will spend multiple semesters studying port half a century ago, when NYU students began venturing to various abroad in Europe, Asia, and Latin America as an integral part of Orie European cities for accredited coursework. Today, nearly every conti- their undergraduate education. “NYU is at the leading edge of what

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r, Co- Dean kers. (MBA an extraordinarily good year in tions who tackled the topic of ment to the upstairs – to sovereign S ’66), rength 2008 – booking 9 billion euros in “Restructuring and Credit Markets government debt. This is scary.” profits. Observing the financial cri- in 2009-2010.” Fabio Cane (MBA ’90), head of sis, however, Saenz asserted that Speaking of “systemic gulli- investment banking, Intesa Sao poor risk management was at fault. bility,” Mark Patterson (MBA Paolo, criticized the “exaggerated ecial “You need to have independent risk ’86), chairman and co-founder, incentive system” and “no sense of s (MBA management and get the board of MatlinPatterson Global Advisers ownership.” Final buyers, he said, elop- directors involved. We have had LLC, highlighted the amount of did not understand the enormous during these rules since I was born.” leverage in the system, citing resi- risk of the financial instruments dential real estate and estimating they were buying, the ones that rat- Room for Improvement $200 to $300 billion in commercial ing agencies rated triple-A. The Rounding out the financial pro- real estate write-offs to come. He financial crisis has offered many gram, Stern Professor Edward predicted that the recovery wouldn’t opportunities for restructuring, said Altman, Max L. Heine Professor of happen until $4 trillion in write-offs Tony C. Alvarez II (MBA ’76), Finance, moderated a panel of had been completed, and added: “We founder and co-CEO, Alvarez & alumni representing three genera- have moved leverage from the base- Marsal, and a turnaround expert

universities will look like in the 21st century,” Dean Blount said. graduate degrees in concert with educational institutions in London, The student body has embraced the international curricula Paris, Hong Kong, and Amsterdam. wholeheartedly. Some 800 high school seniors applied for 50 open The global university concept is as solid financially as it is spots in Stern’s new Business and Political Economy degree. About breathtaking academically. “This is a very robust model,” said Dean 75 percent of entering students will spend at least one semester Blount. “With the possible exception of London, we can deliver pro- abroad during their time at Stern. In addition, through the Edward gramming more cost-effectively abroad.” NYU Abu Dhabi, to be locat- and Nancy Barr Family International Studies Program (ISP), all jun- ed ultimately on a full campus on Saadiyat Island, is funded com- iors are required to take a course on a specific international region pletely by the government of Abu Dhabi, Ballon said. NYU Abu Dhabi, and make a week-long study visit there. “Last March, we had 200 set to welcome its first students in September 2010, will offer a full students in Hong Kong, 200 in Budapest, and 200 in Buenos Aires,” four-year liberal arts degree program. Dean Blount said. The Global Network University project is a “high-risk, high-return On the graduate level, the process of “interleaving” overseas bet,” Dean Blount conceded, but the potential upside has energized study with the New York experience is also moving ahead. About everyone concerned – including session attendees in Barcelona, one 350 to 400 students go overseas each year, with most going to of whom declared he was ready to do college over again – if it was at Melbourne, Hong Kong, Hyderabad, and Singapore through Doing the Global Network University. Business in… (DBi) courses. The School already offers three global

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who was tapped to handle Lehman dant examples in the Spanish nesses tend to be more profitable Brothers’ restructuring. “We are economy. than non-family businesses, and there- St seeing the globalization of restruc- Stern’s Marti Subramanyam, fore tend to last longer – 20 percent last St turing,” he said. Charles E. Merrill Professor of beyond the third generation.” Finance, moderated “Family The panelists attributed the suc- Al Indie Films Rule Business in the 21st Century: An cess of family businesses to their con- Discussing risk from the perspective Anachronism or an Institution for servative grounding in tradition, which I of film rather than finance, Marketing Economic Growth and Stability?” fosters a long-term focus, and their New Professor Al Lieberman, close attention to ence executive director of cash, particularly in Mum Stern’s Entertainment, the efficient use of Prog Media and Technology working capital and program, interviewed higher investment und Michael Barker, co- in R&D. A chief the president and co- concern is succes- ence founder, Sony Pictures sion planning, criti- the Classics, whose career cal to ensuring the and breakthrough moment longevity of the hav came when he negoti- business. “ ated with film direc- “Research shows Bha tor François Truffaut that the combina- Mum for North America tion of family own- we’v distribution of “The ership and profes- T Last Metro” and later sional management cult brought Spanish direc- provides the best of thei tor Pedro Almodóvar’s both worlds,” said glob work to an American Alejandro Beltran, Sriv audience. Speaking managing director acad about “The Independent of McKinsey Spain, tion Film: The Growth who had his own of N of Global Cinema,” experience with a Exp Barker began by calling Stern’s Subramanyam pointed out the family-owned construction company. so m entertainment business track “the importance of family business as an “Th best program of its kind in the institution in Europe and Asia. The Art of Urban Development wha country.” Contrasting indie films “Even in the US, one-third of the The renaissance of Barcelona that O with big-budget blockbuster releas- businesses are indirectly controlled was prompted by the 1992 hosting of Dea es, Barker explained: “There is a by families – think of Wal-Mart and the Olympic Games was just one thread the totally separate independent film Johnson & Johnson,” he noted. of the panel’s discussion of business with a different set of eco- Marc Puig, chairman and CEO “Architecture and Urban Development nomics. Overspend on marketing of a third-generation family busi- as Engines for Economic Growth,” and you kill the profit; under-spend ness, The Puig Beauty and Fashion moderated by Hilary Ballon, professor and there is no profit.” Group, observed that family busi- of urban studies and architecture at nesses have different priorities than NYU Wagner and Vice Chancellor for Old Family Recipes private equity and explained, “You NYU Abu Dhabi Initiatives. The concluding conference ses- are working for something that goes Josep Anton Acebillo Marin, CEO of sion offered alumni the choice of beyond one’s own existence.” Barcelona Regional, SA, recalled the panels on two very different engines Claudio Boada, chairman of lessons learned from the redevelopment for economic growth – the family Circulo de Empresarios, an organi- of Barcelona in preparation to host the business or architecture and urban zation comparable to the Business Olympics, not least of which was the development – both offering abun- Roundtable, added, “Family busi- challenge of reclaiming 20 hectares

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ond from the sea. Jerry Cohen (BS ’53, MBA ’59), a partner in Tishman Speyer Properties, described another daunting project – building a tower over the historic Hearst Building in New York City – which involved difficult zoning issues relating to melding a landmark property with a contemporary tower while incorporating the latest in “green” building techniques and materials. Beatriz Plaza, professor of economics at the University of the Basque Country, highlight- ed the importance to the local tourist economy of the Gehry-designed Guggenheim h El Museum in the Basque city of w, Bilbao. “Bilbao is an industri- ow, al city,” she explained, and the e a choice of an “iconic” builder ah, was essential for the project to move forward. Plaza quanti-

al fied the benefit of the new museum in numbers of tourists and the discounted cash flow of incremental taxes val- related to tourism. Built in 1997, the Bilbao Museum s had recouped its investment nies by 2006, and Plaza also cred- k ited it with adding 8,000 ing local jobs. Praising the public life in rva- Barcelona, Robert Campbell, uct- the Pulitzer-prize-winning architectural correspondent for The The conference formally con- enjoyed classical guitar music by Boston Globe, attributed its quality cluded with a reception and closing The Barcelona Guitar Orchestra. the to population density, naming dinner at the Museu Nacional d’Art Professor Smith toasted Dean al Cambridge, Mass., Paris, and de Catalunya at the Palau Nacional Thomas Cooley for his leadership g Manhattan as other successful exam- (pictured on the cover). Before din- and service to the Stern School, lead- ples of dense cities conducive to ner, alumni had time to tour the ing the alumni audience in a rousing ■ A social and intellectual interaction. permanent exhibit of Romanesque crescendo of “Olés.” These “cities of ideas” can be any- art that features restored frescoes to Visit www.stern.nyu.edu/barcelona d where, he said, but depend on infra- recovered from more than a to view videos of the full presenta- structure. “The art of infrastructure dozen small churches in remote ” ■ tions, additional photos, and more is the art of design,” he said. areas. Following dinner, alumni from the Conference.

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wou its c Questions agem HENRY KAUFMAN (BA ’48 (HEIGHTS), PHD ’58) trol president, Henry Kaufman & Company, Inc. form alwa 10 whe equi tion Henry Kaufman, known as the official oracle of ’20s was heading toward a dictatorship. In the US, ters Wall Street and the original Dr. Doom, was previ- the Depression led to significant reforms, but we und ously managing director and chief economist of maintained our social/political/economic structure. cum Salomon Brothers Inc., and before that served as There is the potential that the situation today will ly – an economist at the Federal Reserve Bank of New result in a more governmentally run economic and sess York. Kaufman has endowed several chairs at NYU financial system. equi Stern as well as the School’s Henry Kaufman entir Management Center. He is chairman emeritus of 2. What are the risks facing the US economy at this the the Stern Board of Overseers and active on the moment, and how well do you think the administra- max boards of a number of public and nonprofit organ- tion and the Fed are handling them? tle r izations. Born in 1927 in Germany, his first 10 The risk we are facing now is a malfunction in our Com years, prior to moving to the US, were spent in financial system. We have a constrained system that O that country’s politically turbulent, hyperinfla- is not a willing lender at this time. So far, the pri- that tionary pre-World War II period, an experience vate sector financial system is ailing and has not the that deeply affected his outlook. Kaufman’s third returned to a vibrancy. A good part of the lending top book, The Road to Financial Reformation: has been taken over by the federal government. We boar Warnings, Consequences, Reforms, was published must move out of that, but how speedily we will be lic by Wiley in August. able to is not clear. thre be e 1. You have indicated that you are, from experi- 3. Are there any lessons from the past that we in outs ence, greatly concerned with the risk of negative the US should be heeding now, but are not? tom political change that often accompanies harsh and Financial institutions and markets have a dual has to fo uncertain economic times. Do you see that possi- responsibility to the private sector. As holders of sav- they bility emerging from the current economic crisis, ings, they have a fiduciary responsibility, and at the that either in the US or internationally? same time, they have entrepreneurial drive. These in th I do see that possibility, but I suspect it is less than a have not been well balanced in the past couple of ably 50/50 chance in the US. However, I would have to decades. That is a key lesson: We need to create a in th say the risks are higher today than at any time in the financial structure in which these two responsibilities firm post-WWII period because the financial situation is are balanced. thus more dire and the mishaps more extreme. The betw response by the public and the White House and 4. Where do you see the US economy in two years? valu Congress can be quite significant when you have In five? Thir extreme economic and financial behavior that In the next two years, I see a modest economic recov- have rent induces potential social/economic/financial shifts – ery, which by most historical standards will not be as each as happened in the ’20s and ’30s. We are a strongly great as in previous cyclical expansions. In five years, othe embedded democratic society, but Germany in the it is a question of how well we have rebalanced our elici part

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atly and me- not the arily ffer- h or pital financial institutions and markets and also their systems has to become far more integrated. The US ntrol supervision – which is in front of Congress today. still will be the dominant country, because we are a the dend democracy with rules of law and behavior; also our vest- 5. Is there a silver lining to the current economic education system at the university level is far more CEO distress the world is experiencing? diverse and larger than anywhere else in the world. to If there is a silver lining, it would have to be that It’s not easy to get that kind of body of knowledge this only in periods of great duress is significant change going in a developing country. The US will continue to t of made. But you have to be careful of that. In the play a leadership role. the ’30s, the government enacted the banking acts of the ’33 and ’35 and established the FDIC and the SEC. 8. What lessons did you learn at Stern – academic nds, This was a sharp deviation from the past, and this or otherwise – that were most useful to you over the t are system performed reasonably well for a number of course of your career? decades. Similarly, now, the major industrial powers One of the lessons I learned is to approach problems turn make will need to recognize that financial institutions by looking at both sides. Don’t prejudge the answer, ting play a unique role, and their public responsibility is try to prove it to yourself. I also learned – primarily vest- significant. Rules and regulations for behavior will from my mentor, Marcus Nadler (retired Stern finance y of need to be put in place. No one does that when professor and leading financial economist) – to try to by things are going well. simplify complex issues. He could take complex eco- acity nomic issues and explain them, putting forth both the (net 6. Do you see a need for more such regulation on plusses and the minuses of an issue and come down to CEO an international level? a reasonable answer. My professors had one foot in the rent Since my view has been that we live in a global real world – the financial world – and one in the aca- ends world, I believe we must have extraordinary coordi- demic world and were able to blend that. xert- nation with other nations, because the markets will but de- arbitrage and the problems will crop up wherever 9. Why do you prize education so highly? gives rules are less strict. It will not be easy to come by, Ignorance is not bliss, it is dangerous. It breeds wrong n by but there ought to be a global board of overseers of conclusions. Only over the longer term can we make rre- major financial institutions, in which the major pow- social and economic changes and that can only come of a ers would participate. through education. Unless we can raise the level of paid educational competence, dangers will increase. vest- 7. The 20th century has been called the American the Century. Who or what do you think will be central 10. What are you most proud of? to the 21st century? I’m lucky and proud to be here, in America. I could n of The 21st century will be one of global integration. have been caught up in the Holocaust rather than ance e the The barriers to trade and financial markets are com- become an American. It’s only when you know the ■ r of ing down. The functioning of economic and financial difference that you value this country. ch it

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Stefan Jacoby this president and chief executive officer men firm Volkswagen Group of America are whe Vijay Vaitheeswaran: America over? als in France are protectionist. And with I’ve seen your company talk SJ: Actually, I don’t hope any of the again, in Europe, it’s much more com- bala about this being one of the American automakers step out of the mon for governments to have stakes in exte worst years in its history or business, because if so, another carmak- car companies. What is the right way for F certainly in recent history. Is er would come in, whether from China, Europe to handle this downturn in a way aspe Stefan Jacoby, president and CEO it as bad as it seems? India, Europe, or another Asian country. that is compatible with competitive mar- of Volkswagen Group of America, Stefan Jacoby: I think it is even worse. We want to play a bigger role here, and kets and a long-term viable strategy? of fi has overseen the strategic direction It’s a long-term economic crisis. Now we therefore we need to Americanize our SJ: I don’t believe the auto industry is a sion of Volkswagen Group’s US automo- see the downside of globalization, as the products, by which I mean that we need national industry anymore. The interlink- enha bile business since October 2007. crisis is global. One problem is that it to have a high local content and to have ing today is so global. We at Volkswagen nan Volkswagen Group of America came so fast – nobody had foreseen it, the product tailor-made to the American are producing globally. Pretty soon in the able houses the American subsidiaries and nobody could have prepared for it. consumer. To do this, we need a strong US we’ll generate 2,000 direct jobs and were of the worldwide family of five Over the years, Volkswagen has optimized American supply industry, and that can 10,000 indirect jobs to suppliers. Our ited brands: VW, Audi, Bentley, our product structure, global presence, only survive with a strong American auto business and our shareholders are glob- coun Lamborghini, and Bugatti. and especially our productivity. And we industry. That’s why we have a strong al. Of course, we have a German her- Volkswagen is the world’s third- nan believe, and we see this in the numbers, interest that our American competitors itage, but through our brands we also largest auto manufacturer and the valu that we are better prepared than some of stay in business. I don’t want to speculate have Spanish, British, and Czech her- largest car company in Europe. why our fellow competitors. I think that we can about what the American auto industry itage. We have joint ventures in China. Jacoby began his career at sigh actually overcome this “perfect storm.” has done wrong, but whatever it was, it We are part of the Brazilian culture and Volkswagen in 1985, after receiving nal was done before this economic crisis. history because we are a long-term play- his MBA from the University of dow VV: You have a major plant in Tennessee They haven’t been prepared for any “per- er in Brazil. I think it would be a huge Cologne. In one of his senior man- – I believe a billion-dollar investment – at fect storm.” That’s the competitive disad- mistake not only for the auto industry but agement positions, he was respon- Com sible for sales in the Asia-Pacific a time when the industry is suffering from vantage the American auto industry has, for the whole recovery of the real econo- T region and for expanding two global overcapacity and the arrival of more at least General Motors and Chrysler. my if governments anywhere turn to pro- Volkswagen joint ventures in China. economically competitive, cheaper rivals tectionism. corp In 2001, he temporarily left from developing economies. How does it VV: The US government has taken a dra- tion Volkswagen to serve as president make sense to invest in a developed mar- matically stronger role. Does this pose a VV: You talk about a global stage. We itore and CEO of Mitsubishi Motors ket that tends to have a glut? problem for you if the US government is saw with much fanfare the recent launch beha Europe, headquartered in SJ: If you don’t invest now, you destroy now standing behind American car com- in India of the Tata Nano – at $2,500 for sepa Amsterdam. Jacoby rejoined your future. We continue to invest in our panies guaranteeing the products? the base model. Ratan Tata, the company (the Volkswagen in March 2004. product. We strongly believe that our SJ: As long as we have fair competition, chairman, has made it clear that he boar products, future technologies, and future we have nothing against some support intends to dress it up a bit to launch it in stitu Stefan Jacoby was interviewed in models are, on a global scale, actually from the US government. I don’t believe Europe and eventually the US. Is this a thou April by Vijay Vaitheeswaran, an guaranteed a bright future. Of course, we that the key for the success and turn- real competitive threat for you at the bot- stru award-winning correspondent for immediately cut costs wherever we could. around for GM and Chrysler is the gov- tom end? sion The Economist and executive-in- And that, of course, is hard. But we are not ernment taking control. You need engi- SJ: Not really. It is a very interesting shar residence at NYU Stern, where he moving one inch from investing in our neers, technology, and talented man- product. Mobility is a strong desire for teaches an MBA elective on energy product, technologies, and long-term agers, not government-related persons. individuals. It is a platform for wealth, mize and the environment. plans here in the US. That would be a The plans I have seen from our competi- growth, and development, not just for Y Vaitheeswaran is the author of the tremendous mistake. tors so far will not bring about a proper economies but for individuals. I think it’s pub book Zoom! The Global Race to turnaround. They need to think differently. fascinating to bring Indian consumers tion Fuel the Car of the Future, which VV: You’re a niche player, relatively from the motorbike to the car. Whether it has was selected as one of five final- speaking, in the US. Give me your per- VV: In Europe, closer to your company’s can compete in Europe or the US, I clea ists for the Financial Times and spective on the giants of American auto- home base, we have seen calls for question. A car is a very important Goldman Sachs 2007 Business rese Book of the Year. mobiles – the Detroit companies that are bailouts for Europe’s automakers or divi- investment for consumers. Whether a deca in such trouble now. Is the age of sions of makers based in Europe. We’ve Tata Nano is the right brand is also ques- have American dominance of automobiles in seen some suggestions that the propos- tionable. man

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VV: You mentioned branding. One of the than 50 percent. The same way you VV: What do you think of an alternative months if you’re driving a convertible on things that Volkswagen and your group of develop your brand, you have to devel- that is advocated by some, that is, using the weekend and not during the week, you brands have been known for is clever op your market. You have to understand the price mechanism, such as carbon are getting mobility by using public trans- branding and your innovative use of mar- the causal differences between markets; taxes? portation. And in winter, you get an off- keting campaigns. How have you shifted be a sustainable, reliable, long-term SJ: With my European heritage and road or a four-wheel drive, as you need to your branding strategies, if at all, to cope business partner; and understand experience, I think this is a necessary go for the holiday and through the snow. with the downturn? Chinese culture, business style, and step that the government has to take. So buying mobility and integrating this SJ: I will tell you a little secret. Behind politics. We have generations of engi- Besides setting industry standards for with public mobility could be an answer. the curtain, from the point of view of neers and managers who lived and fuel consumption and emissions, it is But if we continue as we are, we’ll pretty manufacturing, engineering, purchasing, worked in China, and it was not fun to also important to guide the consumer soon reach the limit. and sourcing, we use the same technolo- work in China in 1985 or 1987. But toward fuel-efficient cars. gy for economies of scale. But to the con- they brought this experience back to our AUDIENCE QUESTIONS sumer, we are all competitors, even within head office in Germany. China is now VV: Is it possible that the robustly devel- our group. We believe in strong, differen- part of our Volkswagen culture. It’s a oping countries – the so-called BRIC Q: When expanding the Volkswagen tiated brands. We also position our big, big business for us. We also have economies: Brazil, Russia, India, China – brand in the US, do you intend to main- brands in different product classes tain the way it’s looked at in Europe, as a against different competitors. Portfolio quasi-premium car, or do you intend to brand management has a very important “If you don’t invest now, you destroy your future. move it lower down? role. Market by market, each brand is We continue to invest in our product. We strongly SJ: Volkswagen has a huge heritage here, viewed differently. For example, Skoda, believe that our products, future technologies, and more or less strongly related to the which is an entry brand in Eastern American pop culture of the ’60s and future models are, on a global scale, actually Europe, is almost a premium brand in ’70s, in California, Woodstock, and so on. India, above Volkswagen. What you don’t on guaranteed a bright future.” We just have to make use of this and revi- see is that Audi’s technology is similar to talize the brand to the mass consumer. ce Skoda’s. We take care to brand whatever the customer can see, feel, touch, and Chinese engineers working in Germany could take a different path than the US, experience by driving a car. That’s the key and are engineering our cars globally. which has developed as a very resource- Q: Can you talk about how the plan for for branding. We believe, especially in intensive country with a lot of sprawl and the Chattanooga facility evolved between this difficult economic time, that con- VV: Where do you stand on alternative not a lot of public transport outside of a when it was originally thought of and Such sumers strongly want a reliable brand fuel solutions? few cities? In those countries, might we today, which is a very different automotive top they can trust. If you maintain a strong SJ: We will rely on fossil fuel for the next see the car not being central to the devel- market? ffect brand, consumers trust you and come 10 to 15 years or even longer. Still, we opment paradigm? SJ: The decision was made in July 2008, ects. back into your showroom. need to significantly improve this technol- SJ: If you compare the traffic density in when the first bad weather report (on the ver- ogy in order to bridge the gap from fossil metropolitan centers like São Paulo, economy) had already appeared. It was the VV: If you were to capture the fuel to, for example, electric vehicles. To Moscow, and Beijing to that of New York, based on an overall long-term strategy of Volkswagen brand in a sentence, what do make electric cars reliable, safe, and New York is like being in heaven. These deci- growth to be number one. We have kept you want it to stand for in America? affordable will take much longer than countries are reaching their limits as well, when this objective for the year 2018. SJ: An affordable German-engineered car people think. and they have to play a proactive role that rdi- Sometimes it’s actually a benefit to be a that’s absolutely fun to drive. I’m a GTI could turn the needle toward bringing ting driver – the pocket rocket, as it used to VV: What is your perspective on attempts this into balance. I understand the German and to be a bit stubborn – during be called. by the government to use technology- Chinese have the same wish to drive cars this heavy storm we are not moving from o for forcing regulations? as Americans and deserve the same our original plan. It is the right timing to rnal VV: Tell me a little bit about how your SJ: I think governments should be tech- human rights of mobility. But we have to invest now in products and facilities here, such success in China evolved. nology-neutral. We need the freedom to think differently. I believe that in the because one thing is very clear: The eco- ple- SJ: We were an early bird in China, develop and see what will be the final future, we will not sell cars themselves nomic climate will change, and then we by having been there 20 years. We have and best solution for an environmentally anymore. We will sell mobility – integrat- will be ready for our growth. ■ ngly, been the market leader there, with more friendly vehicle. ed mobility. That means that in summer

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Prospectus

Is th Peter Blair Henry Named Dean of NYU Stern W work In July, NYU President John relief, international capital flows, and the role of insti- skill Sexton and Provost David tutions in economic growth. He is currently writing a tion’ McLaughlin named Peter Blair Henry, book for Oxford University Press. simi the Konosuke Matsushita Professor of A Rhodes Scholar, Henry is also the John and ence International Economics at the Cynthia Fry Gunn Faculty Scholar and Associate Stanford University Graduate School Director of the Center for Global Business and the we p of Business, as dean of NYU Stern. Economy at the Stanford University Graduate School cogn Henry will assume the deanship on of Business, where he was first appointed an assistant that January 15, 2010. professor of economics in 1997. He is also Senior new Henry led the Obama Transition Team’s review of the Fellow of the Stanford Institute for Economic Policy ance International Monetary Fund, World Bank, and other Research and the Stanford Center for International hired international lending agencies and has served as an eco- Development, Research Associate at the National pany nomic advisor to governments from the Caribbean to Bureau of Economic Research, Nonresident Senior over Africa. He was recently appointed by President Obama Fellow of the Brookings Institution, president of the to the Presidential Commission on White House Fellows. National Economic Association, and a member of the norm The author of numerous articles and book chapters, Council on Foreign Relations. mod Henry has focused his research on the impact of eco- Henry received a BA in economics from the tice nomic reform on emerging economies, and is perhaps University of North Carolina at Chapel Hill in 1991, a com best known for a series of publications in the three flag- BA in mathematics from Oxford University in 1993, prem ship journals of the American Economic Association that and a PhD in economics from the Massachusetts feren overturn conventional wisdom on the topics of debt Institute of Technology in 1997. wher tome new Capital Markets, Insurance, and Research Professor Ralph Alternative Investments, joined the servi shorttakes Government Gomory testified before the US-China Liquidity Working Group at the beha Associate Professor of Finance Sponsored Economic and Security Review Federal Reserve Bank of New York. Thomas Philippon was one of two Enterprises, Commission in March, arguing that Tülin Erdem, Leonard N. Stern valu recipients of the “Best Young arguing that China’s foreign investment incentives Professor of Business and professor may Economist” award, given annually by Le Freddie Mac have contributed to the trade imbal- of marketing, was named editor of the to g Cercle des Economistes in partnership and Fannie Mae ance between China and the US. Journal of Marketing Research, the her with newspaper Le Monde Economie. should be fully Associate Professor of Finance first woman to hold this position. ance The prize was awarded in May at a cere- privatized. Also, Stijn Van Niewerburgh was elected Professor of Marketing Priya Lawrence White how mony at the Senate in Paris. in April, White to the National Bureau of Economic Raghubir has been selected by the Michael Armellino Professor of testified before the US Securities and Research (NBER) Economic editor of the Journal of Consumer Perf Finance and Nobel Laureate Robert Exchange Commission at a roundtable Fluctuations and Growth group. Psychology as one of the “Top 10 W Engle was awarded the Hofstra related to the agency’s oversight of Assistant Professor of Finance Reviewers” in 2008-2009. care University Presidential Medal in recog- credit rating agencies. Marcin Kacperczyk was appointed Research Professor of Marketing cant nition of outstanding career achieve- In December, Edward Altman, Faculty Research Fellow in the Asset Vicki Morwitz was appointed as an US p Max L. Heine Professor of Finance, tes- Pricing program at NBER. area editor for the Journal of ment and scholarly excellence for his firm influential work in the field of econo- tified before the US House Financial Professor of Finance Viral Consumer Psychology. olog metrics and his Nobel-prize-winning Services Committee, providing expert Acharya was recently appointed Associate Professor of research on financial market volatility. commentary on a plan to bail out the Research Associate of NBER in Information Systems Natalia Levina prior Lawrence White, Arthur E. big three American automobile makers. Corporate Finance and of the was elected Division Representative- relev Imperatore Professor of Economics, About two dozen media outlets, includ- European Corporate Governance at-large at the Academy of defin testified in June before the Committee ing The Wall Street Journal, The New Institute (ECGI). Management, Organizational By d on Financial Services of the US House York Times, and Bloomberg, covered Lasse Pedersen, John A. Communications, and Information rienc of Representatives Subcommittee on Professor Altman’s testimony. Paulson Professor of Finance and Systems (OCIS). and

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E New Scholars Join NYU Stern

In fall 2009, NYU Stern welcomed 11 new tenured and corporate governance, and he is currently looking and tenure-track faculty members to its ranks. Stanley at the role of social preferences in corporate gover- Zin joined the economics department as the William R. nance. Having earned his PhD in economics from Berkley Professor of Economics and Business. Zin’s Harvard University, Mertens’s main research interests research interests lie at the intersection of decision the- include asset pricing, macroeconomics, and computa- ory, dynamic asset valuation, macroeconomics, and tional finance. His most recent studies explore origins econometrics. In 1994, the Econometric Society award- and consequences of excess volatility in stock markets ed Zin, along with his co-author Larry Epstein, the and analyze the effects of stabilization policy. Pagnotta hire prestigious Frisch Medal for their “Epstein-Zin Utility studies the intersection of information economics and erse Function,” which has gained wide acceptance as a the empirical analysis of financial markets data. He has hey basic tool of dynamic decision models and now forms recently examined the effects of stock markets’ institu- ose the cornerstone for structural economic models that tional trading rules on investors’ strategic trading inter- e is incorporate psychological/behavioral aspects of deci- action and market outcomes. rent sion-making under uncertainty. Prior to joining Stern, Alexander Nezlobin, who received his PhD in busi- ion, Zin was the Richard M. Cyert and Morris H. DeGroot ness administration from Stanford University, has that Professor of Economics and Statistics at the David A. become an assistant professor in the accounting depart- Tepper School of Business at Carnegie Mellon ment. His primary research interests include accounting ring University. valuation theory, managerial performance measurement, bles Assistant Professors of Economics Robin Lee and and monopoly regulation. His current work examines tely Michael Waugh also joined the department. Lee, who how the knowledge of accounting treatments that a firm earned his PhD in business economics from Harvard adopts may be used in the valuation process. ted University, researches industrial organization and Having earned an MBA from Yale School of d to microeconomic theory, and his focus in platform and Management and a PhD from University of California, wl- two-sided markets have applications in hardware-soft- Berkley, Robert Seamans is a new assistant professor n be ware industries, content distribution, and the healthcare of management and organizations. His research looks at rent sector. Having previously worked at the Federal Reserve the actions that established firms take when threatened ical Bank of Minneapolis and as a consultant to the World by new entrants to the market, and he is particularly xed. Bank, Waugh focuses his research on international interested in how these actions affect the diffusion of per- trade and economic growth and development, specifi- new technology. s a cally examining trade barriers between rich and poor The marketing department added Adam Alter as an ver countries. He was the recipient of several fellowships assistant professor. Alter, who also has an affiliated may and awards, including the Seashore Dissertation Year appointment with NYU’s psychology department, focus- wl- Fellowship at the University of Iowa in 2007-2008. es his research on judgment and decision-making and nes Four assistant professors are new to the finance social psychology, with a particular interest in under- the department: Itamar Drechsler, Samuel Lee, standing the sometimes surprising effects on human ext. Thomas Mertens, and Emiliano Pagnotta. Coming cognition and behavior of subtle cues in the environ- bits from the Wharton School at the University of ment. He received his MA and PhD in psychology of Pennsylvania, Drechsler studies how learning and from Princeton University, where he held the nce, uncertainty affect financial markets and how investors’ Charlotte Elizabeth Procter Honorific Dissertation uals perceptions of macroeconomic and financial risks are Fellowship and a fellowship in the Woodrow Wilson ies, reflected in derivatives prices. Lee’s primary research Society of Scholars. t be includes financial market liquidity, corporate finance,

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Prospectus

Unc F Glucksman Institute Awards Research Prizes to “Deducto Ad Absurdum: CEOs Donating Their Own Stock to Their Own effe Stern Faculty Family Foundations.” The study shows that when corporate chiefs donated shares of their companies’ stock to their private charitable foundations, the able When NYU Stern’s Glucksman Institute for donations were timed to maximize the CEOs’ personal the Research in Securities Markets awarded its annual income tax benefits. ima prizes for excellence in financial research in Honorable mention and $1,000 went to Assistant hav February, the first-place prize of $5,000 went to Professor of Economics Vasiliki Skreta and brai Professor of Finance Xavier Gabaix for his co- Associate Professor of Economics Laura Veldkamp tern authored paper, “Tractability and Detail-Neutrality in for “Ratings Shopping and Asset Complexity: A an i Incentive Contracting.” The paper develops a contract Theory of Ratings Inflation.” They show that the stra Xavier Gabaix for CEO incentives that is proven mathematically bet- Vasiliki Skreta increased complexity of assets triggered ratings bias, fram ter than options and stock. which ups the incentive for companies to shop for the best rating. That, in thos Professor of Finance David Yermack, Daniel P. Paduano Faculty turn, leads them to develop even more highly complex assets to get even an i Fellow and Yamaichi Faculty Fellow, took second place and $2,500 for higher ratings. dem ing tha researchroundup stricted gift of $50,000 to study Review, was selected as one of the pro online and offline media interac- 50 best articles published in 2008 mor Marketing Professors Eric Assistant Professor of tions. Professor Chakravarti’s in management, winning an duc Greenleaf, Geeta Menon, Tom Information, Operations, and research proposal for Google was Emerald Management Reviews enga Meyvis, and Vicki Morwitz, with Management Sciences Anindya based on his co-authored research Citation of Excellence. men principal inves- Ghose and Professor of paper, “The Neglect of Prescreening Associate Professor of T tigator David Information Systems Vasant Information,” that was published in Information Systems Natalia likel Heeger, a pro- Dhar, with Keith W. Ross at NYU- the Journal of Marketing Research. Levina and Assistant Professor of dem fessor in NYU’s Poly, were The research examines how expo- Management and Organizations sone Department of awarded one of sure to online information affects Aimée Kane is fu Psychology and the first 15 offline buying behavior. won the best as t Center for competitive Sinan Aral, assistant professor paper award at the have Neural Science, Vicki Morwitz grants given by of Information, Operations, and International time and Uri Hasson, an assistant pro- NYU and NYU- Management Sciences, was given Workshop on fessor of psychology at Princeton, Poly for Vasant Dhar the 2009 IBM faculty award, a Intercultural rush were awarded a two-year, $1.1 research collaborations between $40,000 cash grant, to support his Collaboration for geth million grant by the National the two affiliated institutions. They research, “Unlocking the Business Aimée Kane “Immigrant opp Institutes of Health’s National received $73,500 in seed funding Value of Information in Large Managers as Boundary Spanners ic re Institute on Drug Abuse to support for their research proposal, “The Dynamic Social Networks.” The on Offshored Software Development deci their research project entitled, Economics of User-Generated research aims to understand how the Projects: Partners or Bosses?” suff “The Neural Correlates of Effective Content in Online Social Media,” movement of information in massive William H. Joyce Professor of soni Drug Prevention Messages.” By in which they explore the moneti- social networks affects the produc- Marketing Russell Winer’s 1999 whe combining methods from market- zation of user-generated content tivity of information workers and Management Science paper, pote ing research with functional mag- through online advertising. population level product adoption “Endogeneity in Brand Choice cal netic resonance imaging (fMRI) Associate Professor of and demand patterns. Models,” with Miguel Villas-Boas, We and eye movement data, the proj- Marketing Amitav Chakravarti Professor of Accounting won the inaugural INFORMS ence ect will assess the effectiveness of won the inaugural 2009 Google Stephen Ryan’s article Society for Marketing Long-Term grea anti-drug television ads in deter- and WPP Marketing Research “Accounting in and for the Subprime Impact Award at the Marketing ring drug use. Awards, which include an unre- Crisis,” published in Accounting Science Conference in June. und ing

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ming urs vely ua- rate ally eci- on hey WHEN THE GOING ted, , as sses has GETS TOUGH that oss- New research into organizational behavior highlights the is, ling particular challenges of managing in a recession ater tain We’ve heard about the financial aspects of the losses than their gains, a mindset that could tempt ions recent economic crisis, but what about the human them to stretch ethical boundaries more than they hen capital side? A down economy, with bottom lines might have when gains were the norm. As for those ften suffering and massive unemployment, presents a companies who are, or expect to be, in a hiring ible host of potential problems and opportunities for cor- mode, they have an unusually large pool of job eing porate managers. Employees may behave differently applicants from which to choose. Should an appli- ers. am- than in rosier times, and it takes canny management cant’s relevant experience automatically make him uals to be alert to the new dynamics. For instance, those or her a better hire, or are there unforeseen com- ome workers fortunate enough to have jobs may nonethe- plexities when they bring their experience to the ths, less have been subjected to pay freezes or even new organization? ical cuts, a sure drag on incentive. How then does their The following excerpts of three papers by Stern ider employer hope to motivate them to do more than just faculty present research that will provoke a thought- that g a “mail it in”? And with corporate profits squeezed, ful contemplation of the dynamics of human organi- pressured employees may be more focused on their zational behavior and how to manage it.

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By Steven L. Blader

men HOW TO INSPIRE MOTIVATION third tity Getting more than your money’s worth as a manager means treating uate teste employees with respect and fairness, not just providing decent paychecks two cond maj whe ciall s any manager extra role behav- a br A can attest, ior, and it is work motivating employ- essential to an indu ees to go the extra organization’s we q mile is no easy viability and suc- perm task, even in palmy cess. T times. In periods of In order to only economic distress, better understand they when companies what motivates far a are under unusual such extra role tity financial pressure, behavior, we than it is especially explored its rela- mot important to gain tionship to social Furt employees’ long- identity, but we expl term commitment also investigated justi and loyalty. Under- the interplay of emp standing how to social identity D motivate a workforce during such The Organization Man and group engagement with two prov downturns will serve organizations We knew from previous research other elements of organizational life thes well not just through the rainy that the extent to which employees that are known to influence employ- to e days but through a recovery as relate to the organization they work ees’ engagement with the group: how cal well, when other job opportunities for – their group engagement – is a fairly they believe they are treated by whe may beckon. critical factor in how they fulfill their their company (their judgments of cont With my colleague, Tom R. Tyler, roles there. A key element of that procedural justice) and how fairly or ence University Professor of Psychology at engagement is their social identity, well they believe they are compensat- also NYU, we set out to test our predic- which we define as a multidimen- ed (their judgment of their economic ackn tion that identification with the sional construct that works to pro- outcomes). that organization, pride, and respect duce the implications of group mem- the would be critical to whether employ- bership on the concept of self – a A Complex Dynamic iden ees feel valued and motivated enough kind of mirroring of group values and Our first hypothesis was that shap to contribute more than is required. shared identity that contributes to an employees’ social identity will be T If this proved to be true, we rea- individual’s self-image. The social positively related to their extra role thin soned, it could help companies solve identities employees form around behavior. The second was that social espe the eternal puzzle of how to retain their work groups and organizations identity is shaped by employees’ pro- ally and motivate their employees. are strongly related to whether they cedural justice judgments; further- expe will do more than is required of them. more, social identity accounts for the hop This extra performance is called effect that employees’ fairness judge- simi

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ments have on their behavior. Our because of their economic or instru- of a strong social identity. Financial N third hypothesis was that social iden- mental value. Our findings here sug- incentives must be dispensed in ways tity is shaped by how employees eval- gest that a primary way in which that lead employees to regard their uate their economic outcomes. We economic outcomes may affect relationship with their organization tested these hypotheses in each of behavior is through their impact on positively. When such incentives are s two field studies. Our first study was social identity. provided in an environment marked conducted in a work group within a by threats or guided by obligations, major financial services organization Practical Implications it becomes less likely that economic where economic concerns are espe- These findings suggest that the outcomes will positively affect social cially prominent. In the second study, basis of employees’ relationships identity or behavior. Even more, hav- a broader and larger test, employees with their organizations is primarily when employees must force their is worked in diverse jobs in diverse linked to the role the organization organizations to provide them with an industries and locales. In both studies plays in affecting how employees better economic outcomes – for on’s we queried employees and, with their think and feel about themselves. instance, by looking for alternate suc- permission, their supervisors. Many important practical implica- jobs, getting outside offers, or taking The results in both studies not tions follow from this insight. First collective actions – then it is unlikely to only supported all our hypotheses, and foremost, the company has great that their achieving their goal in this tand they exceeded our predictions inso- power to motivate their employees if manner will foster social identity or ates far as they indicated that social iden- it can help them develop social iden- motivate them to work extra hard. role tity is an even stronger influence tities that are grounded in the organ- Of course, the practical implica- we than we expected on employees’ ization and in their particular work tions of these studies are influenced rela- motivation to go the extra mile. groups. The results also indicate two by the level of employee in question. ocial Furthermore, social identity largely important levers that organizations Among employees at lower socioeco- we explained the effects of procedural can use to encourage the develop- nomic levels, for whom resources are ated justice and economic outcomes on ment of social identity. First, they literally critical, the impact of finan- y of employee behavior. can operate in ways that employees cial incentives on behavior may be tity Determining that social identity regard as procedurally fair, institut- more direct. Similarly, social identity two provides the mechanism by which ing fair decision-making processes may be less likely to shape behavior life these organizational conditions relate and extending fair quality of treat- among employees who have tenuous loy- to employee behavior provides criti- ment. Second, they can provide eco- links to the organization, such as how cal insight into understanding how, nomic outcomes that employees temporary and contract workers, d by when, and why efforts to shape the regard favorably and that encourage and among workers that do not share s of context of employees’ work experi- employees to link their social identi- demographic group memberships or y or ences may affect their behavior. It ties to the organization. values with the organization. Still, nsat- also contributes to the growing The key to successfully applying the results of this and related omic acknowledgement within psychology any of these insights is doing it loud research clearly suggest the potential that the collective self – the aspect of and clear. Employee judgments of value, under many circumstances, of the self most closely linked to social procedural justice are susceptible to social identity for understanding identity – plays a fundamental role in a wide array of subjective influences, employee attachment to organiza- that shaping employee behavior. and as such, merely implementing tions and, moreover, of social identi- be The results for the way employees fair procedures isn’t enough. ty-based ways of stimulating higher role think about their compensation are Organizations must also ensure that levels of extra role behavior in hard ocial especially interesting. It is tradition- employees are well aware that such times. ■ pro- ally believed that pay, benefits, procedures are in operation. her- expectations of promotion (and thus, Another challenge is to provide STEVEN L. BLADER is associate r the hopes for greater pay), and other economic outcomes in ways that professor of management and organiza- dge- similar factors affect behavior actually encourage the development tions at NYU Stern.

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By Mary C. Kern and Dolly Chugh BAD BEHAVIOR People act more unethically when facing a possible loss than the opportunity of a gain

ven ordi- case, a framing nary peo- effect occurs ple are when objectively E prone to identical situa- shocking ethical tions generate lapses. As the dramatically empirical study of different deci- ethics has surged sions based on in the past two whether they W decades, clear evi- are presented, dence has emerged or perceived, as that ethical think- potential losses ing and behavior or gains. It has are prone to many been shown that of the same mental people are loss- Ne processes and pit- averse; that is, falls as the rest of they are willing human thinking to go to greater and behavior. Just as we humans ing. Similarly, it has been posited lengths to avoid a loss than to obtain are prone to systematic and pre- that moral intuition precedes moral a similarly sized gain. W dictable cognitive errors, we appear reasoning, and that one’s overall We considered the implications rece to be prone to systematic and pre- moral judgment is heavily biased of framing effects for ethics. When cap dictable ethical errors. towards the leanings of a rapid and making decisions, individuals often suff This tendency seems ingrained. automatic process, rather than a choose from an array of possible hos Earlier research with patients who slower, more thoughtful one. responses, with some choices being pora incurred brain damage suggested In our study, we explored the more or less ethical than others. that visceral, automatic flashes of effect of this apparent reflex tenden- Our study showed an “ethical fram- than affect guide moral choices, inde- cy on the consciousness and behavior ing effect”, such that individuals to b pendent of learned knowledge about of decision-makers in the moment of who perceive a potential outcome wor morality. Indeed, neuroscientific ethical choice. What is the role of the as a loss will go to greater lengths, less data has illustrated that the areas of decision-maker’s cognitive framing and engage in more unethical cuts the brain tooled for cognitive rea- of the situation vis-à-vis the time he behavior, such as using insider emp soning and those generating more may have to make a decision? We information or lying, to avert that automatic responses were both acti- turned to the concept of framing as loss than individuals perceiving a “ma vated during moral decision-mak- the foundation of our inquiry. In our similarly sized gain. pres

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Uncontrolled Impulses sion generated by the framing effect. people viewed situations as potential Framing is less likely to have an In this work, we manipulated the losses, it influenced their behavior frame of the decision-maker by and ability to make ethical judg- ed effect when decision-makers are he able to fully process ments. People trying to onal the information. Brain avoid a loss were more imaging experiments The results showed that when likely to make lower-road tant have shown that ethical choices than peo- brain activation pat- people viewed situations as ple trying to attain a gain. amp terns that occur when “ potential losses, it influenced We explain this tendency an individual demon- using the theory of fram- strates the effect of their behavior and ability to make ethi- ing effects. Furthermore, bias, framing differ from cal judgments. People trying to avoid we demonstrated how this n those that occur when effect can be eliminated an individual does not a loss were more likely to make by removing time pres- demonstrate the fram- lower-road ethical choices than sure, suggesting that peo- ing effect, suggesting ple make poor ethical that “automatic” people trying to attain a gain. choices when they react processes that are ” automatically, without the 008 more or less reflexive in nature pro- time to think things duce the framing effect, while either describing the probability of a through. They make better choices engagement in more deliberative potential gain or the probability of a when that time pressure is absent. mental processes can reverse it. potential loss in the situation. The experiments involved what was, The effect of framing seems most Importantly, the gain and loss condi- in truth, a gain. Simply framing the likely to occur under conditions that tions presented identical problems, outcome as a loss or gain was suffi- r of demand an automatic, versus rea- simply expressed in different lan- cient to generate the effect. s soned, response. Because reasoning guage so as to manipulate the partic- What makes these framing effects e is fueled by cognitive resources, such ipant’s framing of the situation. most ethically worrisome is the as time for deliberation, researchers Three experiments, each with unique absolute consistency and transparen- at the have shown that reasoning under dependent measures and samples, cy of the underlying reality facing time pressure is vulnerable to being offered evidence for our hypotheses. both loss-framed and gain-framed rushed, fragmented, or skipped alto- We tested for a main effect of frame decision-makers. It is unsurprising n for gether. Thus, framing offers an using a judgment task assigned to 55 that desperate people engage in des- opportunity to examine the automat- undergraduates. Then, with a group perate behaviors. However, decision- rs ic response in action during ethical of 92 part-time MBA students at two makers need not face desperate cir- ment decision-making. In the absence of northeastern colleges, we added in cumstances to be at ethical risk. As sufficient cognitive resources for rea- behavioral measures of misrepresen- we discovered, framing effects are r of soning, we expected to find that tation and false promises. Finally, we responses to gains or losses relative to 999 when a situation is framed as a both explicitly imposed and removed a reference point; the ethical risk does potential loss, the influence on ethi- time pressure, with 93 recruits, in not require absolute desperation, only cal decision-making is heightened. order to test whether the framing relative levels of loss. ■ oas, We further expected that the influ- effect on ethics is the result of an DOLLY CHUGH is assistant professor of ence of the framing effect would be automatic process. m management and organizations at NYU greater when decision-makers are Stern. MARY C. KERN is assistant pro- under time pressure, thus heighten- The Sad Truth fessor of management at Zicklin School of ing the automatic nature of the deci- The results showed that when Business at CUNY’s Baruch College.

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By Gina Dokko, Steffanie L. Wilk, and Nancy P. Rothbard UNPACKING PRIOR EXPERIENCE The career baggage employees bring can have unexpected effects on job performance an Zi Be res ory eco ed he bonds of tions do not explicitly hire pr corporate in order to gain diverse Fu loyalty were knowledge. Instead, they ba broken seek employees whose the T inc decades ago. It is a tru- prior work experience is ism that in the post- similar to the current sio industrial era, all needs of the organization, Zi bets are off, and the because they expect that Pr Te concepts of lifetime these employees will bring Un employment and “the knowledge that enables company man” are them to be immediately Mi relics. In theory, compa- productive. ear nies have it good, fish- While prior-related Un ing for new employees experience is believed to mi in a sea of experienced confer valuable knowl- tw workers with no strings edge and skill that can be wa attached. We set out to applied to the current sec test whether new hires work context, empirical Ba with relevant experi- findings have been mixed. Ba ence are always the best catch. the average American worker born Most studies of experience and per- tra The growing instability of the in the later years of the baby formance treat experience as a ca employment relationship has been boom had 10.5 employers by age proxy for knowledge. However co the subject of intense scrutiny. 40. Experience in a single firm, prior work experience may an Fewer people follow stable or pre- therefore, captures only a fraction include not only relevant knowl- Fe dictable career patterns within of the total work experiences of edge and skill, but also routines one organization, and their expe- most individuals. and habits that do not fit in the de riences are increasingly likely to The corollary to a more mobile new organizational context. Th occur across, rather than within, workforce is the hiring of more expe- Indeed, these routines and habits fro firm boundaries. In the late rienced workers. But what do organ- may limit the positive effect of Pe 1970s, Americans were estimated izations get when they hire experi- prior experience on performance, un to have an average of seven enced workers? Yes, experienced suggesting that when individuals pe employers in their working life- workers can bring in diverse knowl- move across firm boundaries, ref times. By 2005, the US Bureau of edge that enables innovation and their prior experience may not be inc Labor Statistics had found that performance. But most organiza- wholly beneficial.

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Is the Past Prelude? gle the positive and negative effects expectations and result in a negative We proposed that experienced of prior-related experience on per- effect on performance once knowl- workers may carry knowledge and formance. edge and skill is accounted for. In ti- skill that contributes to an organiza- Specifically, we predicted that contrast, adaptable workers and a tion’s goals, especially when there is prior-related experience has an over- those who feel they fit well into the similarity between the prior experi- all positive effect on job performance culture of the new firm are less ence and the current work. However, because of the transferable knowl- subject to the negative overhang of we predicted they also may transfer edge and skill, but has a negative the past. And while prior-related ol cognitive and behavioral rigidities effect on performance once knowl- experience has a positive effect on nt that can impede performance in the edge and skill is accounted for. To task-relevant knowledge and skill, new firm. For instance, in the insur- support our contention that this neg- firm tenure ultimately becomes y ance industry, a claims adjuster ative effect of prior experience on more important. hired from another com- Assessing the effects pany, where haggling of hiring experienced over claims was the workers is important e An employee’s understanding he norm, might take this because human resources model of industry prac- of how her industry works, as are mobile, and lifetime tice to a new insurance well“ as norms from her prior experi- employment within one firm is a relatively small , a company that charges a ences, may conflict with a new premium price and dif- part of the US employ- ferentiates on service, employer’s expectations and result in ment picture. Workers where haggling with cus- a negative effect on perfor- have differing portfolios tomers is contrary to the of knowledge and skill new firm’s customer mance once knowledge and gained from prior work e service norms. Haggling skill is accounted for. experience, and these portfolios contribute dif- rk. behaviors may not be Stern valued in this new setting, yet they performance is related to cognitive ”ferentially to a worker’s current job ssor may be very difficult for an adjuster and behavioral rigidities, we performance. Understanding how of the to give up if it has become part of explored whether adaptability and past job experiences contribute to he her mental model of how insur- cultural fit made a difference. organizations’ needs is important. If . ance companies make money or Interestingly, we found that the organizations understand how appli- a how a competent adjuster behaves. effects of prior-related experience on cants’ work histories affect their per- the er Performance can suffer as a result. task-relevant knowledge and skill in formance, they might consider the 0 We addressed these issues using the current firm diminish the longer effects of prior experience in design- career history data from all appli- a person is employed at the current ing selection, training, or socializa- eting cants to the call centers of a major firm. tion processes. ■ s an US property and casualty insurance Caveat Employer GINA DOKKO is assistant professor firm. We conceptually and method- of management and organizations at ologically distinguished between Our findings reflect the subtleties NYU Stern. STEFFANIE L. WILK is evina prior-related experience and task- of the imperfect portability of expe- associate professor of management and tive- relevant knowledge and skill as rience and the importance of adapt- human resources at Ohio State defined by the current organization. ability. An employee’s understanding University’s Fisher College of Business. NANCY P. ROTHBARD is associate By distinguishing prior-related expe- of how her industry works, as well as professor of management at the on rience from task-relevant knowledge norms from her prior experiences, Wharton School of the University of and skills, we were able to disentan- may conflict with a new employer’s Pennsylvania.

Sternbusiness 29 185769_KA_printerSpreads_R1.qxd:SternMag09fallSpreads.qxd 10/13/09 9:11 AM Page 42 ILLUSTRATION BY KEN ORVIDAS ILLUSTRATION Keeping the CEO in Line

Wayward chiefs are often brought to heel by the complex dynamics inherent in their companies’ structure, a phenomenon that can be called internal, rather than corporate, governance

By Viral V. Acharya, Stewart C. Myers, and Raghuram G. Rajan

ecent upheavals in the world takeover activity, and shareholder may restrain their own efforts. Such of finance and business have activism, the recent financial crisis a reaction can, in turn, hurt top R been eye-popping even to has illustrated that the internal gov- management, because it will affect the most battle-hardened observers. ernance of firms can be equally the firm’s short-term prospects. With trillions of dollars in capital important. Thus, by extension, internal gover- having evaporated, it is perhaps sur- To explore this, we developed a nance can function to lengthen the prising that even more firms haven’t model of internal governance where horizon of top management’s deci- followed suit. But the corporate the self-serving actions of top man- sion-making. It works best when structure is surprisingly hardy. One agement are limited by the poten- both top managers and subordi- reason may be the effect of what we tial reaction of subordinates. Our nates play active roles in creating call internal governance – the checks hypothesis, put simply, was that if value at the company. and balances employed and imposed top managers are myopic or short- In our model, we allowed also for by a firm’s own employees on its term in their outlook and do not governance provided by external decision-makers. While corporate invest in the firm’s long-term future, financiers. We showed that such governance is generally interpreted then subordinates and junior man- external governance can comple- as the effectiveness of such mecha- agement – who are better aligned ment internal governance by nisms as boards of directors, with the firm’s long-term future – enhancing firm value. Interestingly,

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this provides a theory of invest- and have little ability to scrutinize Much of the existing literature ment and dividend policy over the top management’s decisions, and has treated the firm as a monolith- firm’s lifecycle, where dividends that some CEOs are self-interested ic single-employee entity. Our are paid by the top management rather than working for sharehold- approach was to see it as compris- when growth prospects diminish, ers. Admittedly, the market for cor- ing diverse agents with different with the effect of maintaining a porate control can offer some disci- horizons, different opportunities m- balance between internal and pline, but it is hard to see it as for misappropriation and growth, s in external control. effective in controlling operational and different interests. Think, for ay for Finally, we examined how certain decisions. How then do we reconcile example, of a partnership run by a way mar- aspects of the internal organization the survival, and hence presumed an old CEO who is about to retire y? of firms – for example, the succes- efficiency, of the public corporation and who has a young manager is a sion plan – may be structured to with the ineffectiveness of the working under him who will be the rlink- enhance the role of internal gover- supposed channels through which future CEO. Three ingredients go wagen nance. Working through the vari- it is governed? into producing the firm’s current in the ables as we tested our theory, we We argued that there are impor- cash flows. First, there is the firm’s and were able to see why firms with lim- tant stakeholders in the firm, such as capital stock, which could be the ur ited external oversight, and firms in critical employees, who care about firm’s physical capital (machines), glob- countries with poor external gover- its future even if the CEO has short or organizational capital (net- r- nance, can still have substantial so value. Conversely, it was obvious er- why even firms with external over- na. sight can go astray when their inter- and nal governance mechanisms break play- down. ge ry but ono- Complex Dynamics pro- The common view of the public corporation is that of an organiza- tion run by top managers, and mon- We itored by a board of directors on unch behalf of public shareholders. The 0 for separation of decision management In June, Professor Viral Acharya (center), along with his co-authors Raghuram Rajan and mpany (the CEO) from decision control (the Stewart Myers, received the III Jaime Fernández de Araoz Corporate Finance Award for the work- board) and from risk-bearing con- ing paper on which this article is based, “The Internal Governance of Firms.” The award was h it in stituents (public shareholders) is presented in Madrid by the Prince of Asturias (right), Crown Prince of Spain, and the ceremony was attended by Miguel Sebastian, Spanish Minister of Industry, Tourism and Trade; Ms. is a thought of as a reasonable way to e bot- Esperanza Aguirre, President of the Community of Madrid; and Mr. Luis de Guindos, Chairman structure firms, and so long as deci- of the Jury of the III Jaime Fernandez de Araoz Corporate Finance Award. This award, the only sions are made in the interests of the one of its kind in Spain, recognizes the impact of applied research in economics and corporate g shareholders, efficiency is maxi- finance. It carried a cash prize of 10,000 euros. for h, mized. or Yet the clear evidence that the horizons and is self-interested and works), or relationship capital nk it’s public corporation is an organiza- shareholders are dispersed and pow- (client relationships). The second rs tional structure with survival value erless. These stakeholders, because ingredient is the CEO’s ability to her it has to be set against the equally of their power to withdraw their con- manage the firm based on his talent clear evidence, shown by various tributions to the firm, can force a and his knowledge of its specific researchers over the past few self-interested, myopic CEO to act in problems, and third, the young a decades, that most shareholders a more public-spirited and far-sight- manager’s effort, which allows her ques- have little control over boards, that ed way. We call this process internal to learn to deal with the firm’s many boards are poorly informed governance. specific issues.

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In our model, we assumed the vide incentives for the manager. If influence. Even so, it can greatly CEO could put in place internal the manager’s contributions domi- enhance investment by the CEO and audit and accounting mechanisms nate, the manager has little incentive the value of the firm. In our frame- that would make a predetermined to learn because she cannot appro- work, the improvement was not amount of cash flows and assets priate value today, and the learning because outside equity monitors the verifiable and ensure they are left will be of little use when she does actions of the CEO, but primarily behind as the firm’s capital stock. become the CEO and can appropri- because equity holders are indiffer- The CEO could also appropriate the ate value. Also, because both con- ent between being paid in cash or remaining cash flows and assets – temporaneous and forward-looking being “paid” via a higher capital fina more generally, he could consume elements of the business environ- stock – and, of course, the control supe perks, “tunnel” cash and assets out ment matter for participant incen- rights inherent therein. For the of the firm through self-dealing, or tives, internal governance works best CEO, the dollar paid out as dividend even not generate cash by shirking when the business environment is and the dollar left behind as invest- 5. Is his job. stable and the age profile of employ- ment costs the same, but the CEO dist Note that because the CEO has a ees slopes up the hierarchy. prefers to pay by investing to If th short horizon, he could simply increase capital stock because this only decide to appropriate all the cash Outside Influence will have the collateral effect of mad flow and assets. However, in order We have implicitly assumed so far motivating greater effort by the ’30s to generate cash in the first place, he that the firm’s capital stock is in manager. This could explain the ’33 needs the young manager to put in intangible assets, such as the human reluctance of firms to pay dividends, This effort. If the manager sees little capital of employees or client rela- even when returns on investment are syst future in the firm because the CEO tionships, which cannot be seized or not great. deca leaves nothing behind, the young sold. But what if the investment were Eventually, as the rate of return manager will have little incentive to instead in tangible assets, such as on capital falls, the CEO could make will exert effort. This can reduce cash machines or land, which could be the manager worse off by investing play flows considerably. To forestall this, seized and sold? This would then more capital. This is because invest- sign the CEO will commit to investing offer a role for outside financing (for ment will increase the capacity of need some fraction of the cash flows and example, equity), and would allow outside equity to extract value by thin to preserving past capital stock in the firm to be structured as a public more than it increases the capacity order to create a future for his corporation. We showed that the of the manager to generate cash (net 6. D young employee, thereby motivat- combination of crude outside gover- of this period’s effort cost) as CEO an i ing her. This allows the firm to build nance, together with internal gover- next period. This is when the current Sinc substantial amounts of value, nance, can improve the efficiency of CEO will switch to paying dividends wor despite being led by a sequence of the firm dramatically. – not because of the pressures exert- nati myopic and rapacious CEOs.1 To see this, we assumed that out- ed by outside equity alone, but We showed that internal gover- side equity has the capacity (through because more investment will de- arbi nance is most effective when neither the board of directors) to periodical- motivate managers. This then gives rule the CEO nor the manager domi- ly exercise its fairly crude ownership us a dividend policy in firms run by but nates in contributions to the firm’s right of taking over control of the self-interested CEOs that corre- maj cash flows. Intuitively, if the CEO assets. Outside equity thus has no sponds to the observed life cycle of a ers w dominates, he has no desire to limit direct effect over the investment or firm, with dividends not being paid his appropriation in order to pro- effort decision – it has no operational when the firm is young and invest- 7. T ment profitable but only when the Cen 1 firm is mature. While our CEO is myopic and self-inter- objective of CEOs. Of course, most CEOs to th ested, in reduced form, he appears to act are not the caricatures that economic mod- Interestingly, this combination of The as if he cares about his subordinates and els like ours make them out to be, yet it is internal and external governance the survival of the firm. Indeed, other reassuring that even though we imbue The research that included interviews of top them with no redeeming qualities, the can eliminate the rents (rents are the CEOs has suggested that continuity of the model still has them doing reasonably difference between what a factor of ing firm, rather than maximizing shareholder good things for the firm. value, appears to be the primary stated production is paid and how much it

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would need to be paid to remain in each other ensure the firm functions detailed information available only its current use) extracted by man- well, even if outside control is weak. within a firm, employees of financial agement, even though equity’s con- Our model is simple, perhaps firms are relatively immobile. Each trol rights are very crude. Other even overly so. Top management is cares about the longer-term future of forms of providing incentives do not both myopic and self-interested. Yet, his own firm and has an incentive to always fare so well. We examined considerable value is preserved in monitor the actions of both col- whether giving the CEO leagues and superiors. As equity-based compensa- “Internal governance can function to lengthen the capital becomes more tion could improve mat- widely available, though, ters. It turned out that horizon of top management’s decision-making.” employees become more under a variety of cir- mobile and care less about cumstances – it did not, interesting- the organization because of the need the long-term future of their firm. ly – the limited control rights pos- for top management to motivate The internal pressure to worry about sessed by outside equity imply that younger managers. the long term becomes weaker. equity values do not reflect the Our model suggests why it may Finally, we suggest a rich interac- entirety of cash flows produced by be so hard for firms to shrink grace- tion between the internal structure the firm. Indeed, the dictum to fully, and why it may make sense for of firms, the strength of internal maximize equity value may offer lit- a firm (like Philip Morris) in a governance, and the need for any tle relevant guidance in such firms. mature, declining industry like external governance. Internal gover- tobacco to diversify into a growing nance may be quite effective in Competing Interests industry like food (by acquiring growing firms with young staff, Our point, more generally, was Kraft). If the firm were to stay in the where human capital is firm-specif- that the traditional description of declining industry, it would either ic. By contrast, external governance the firm – an organization run by have to over-invest or see a collapse may be much more important in top managers and monitored by a of incentives, and worse, a collapse mature firms in declining industries board of directors on behalf of pub- of the discipline imposed by internal with aging staff, where the required lic shareholders – falls short on governance. Rather than see the management skills are fairly generic. three counts. First, control need not value destruction associated with Countries like Japan that have had a be exerted just top down, or from such a decline, the second best rapid demographic transition may outside, it can also be asserted bot- option might be to “morph” into a also have suffered as their old sys- tom-up. Put differently, the CEO new business. What might be tem of internal governance becomes has to give his subordinates a reason thought of as empire building by top less effective in a newer environ- to follow, and this, implicitly, is how management may just be a reaction ment. More generally, there is a rich they control him. Second, the view to pressure from below. Indeed, pre- vein of research to be mined in see- that there is one residual claimant vious research has found that unfa- ing the linkages between the internal in the firm, the shareholder, is prob- vorable expectations of marginal organization of firms, internal gov- ably too narrow. Anyone who shares returns to investment in existing ernance, and external financing and in the quasi-rents generated by the businesses are an important spur to governance. We have just touched firm has some residual claims, and diversification, a finding consistent the surface. ■ thus there is no easy equivalence with the implications of our model between maximizing shareholder (but also with others). value and maximizing efficiency. VIRAL V. ACHARYA (PhD ’01) is professor Third, the fact that different parties Loyalty or Pragmatism? of finance at NYU Stern. STEWART C. have claims to different residual The breakdown of internal gov- MYERS is Robert C. Merton Professor of rents at different horizons means ernance may also explain the Financial Economics at MIT Sloan each one has to pay attention to the increasing evidence of agency prob- School of Management. RAGHURAM G. others’ residual claims in order to lems in financial firms in the ongo- RAJAN is Eric J. Gleacher Distinguished elicit cooperation. The checks that ing crisis. When capital is relatively Service Professor of Finance at University parties inside the firm impose on scarce and allocated based on of Chicago Booth School of Business.

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Peer to PeerStudent Life in Washington Square and Beyond

Tapping into the Middle East’s Emerging Markets By Rika Nazem

As a Lebanese-American who has alternated between living and working in the US and Kuwait, Fatenah El Danab (MBA ’10) came to NYU Stern wanting to leverage her Stern connections with net- working opportunities in the Middle East. It was for- tunate, then, that she met fellow classmate Joshua Weiner (MBA ’09), who was establishing the United Arab Emirates (UAE) Initiative, under the auspices of the Emerging Markets Association (EMA) MBA club, which would allow students to explore economic and

cultural opportunities in the Middle East. (Top photo) Fatenah El El Danab, a Mohammad bin Rashid (MBR) Fellow, Danab (second row, second from left), became a UAE Initiative officer and co-led the trek. “I Josh Weiner (first row, have witnessed firsthand the economic boom in Dubai second from right), and classmates take a and the changing face of the Gulf Cooperation boat tour in Jumeirah, Council, which includes many setbacks as a result of Dubai, United Arab Emirates. the rapid expansion and the brain drain affecting that (Left photo) An aerial part of the world,” she said. “Seeing these changes view of Jumeirah, motivated me to join EMA because of the chance to Dubai, United Arab strengthen ties to the region and include Stern in its Emirates success.” is a blend of Western practices and traditional Arab val- Weiner and El Danab didn’t expect the overwhelm- ues. “Business is not done very differently from New ing student response they received for the trek: 18 York or Singapore. However, there are certain norms full- and part-time MBA students traveled to Dubai that are generally accepted, and which some companies and Abu Dhabi, visiting 13 companies in five days. abide by strictly, such as allowing employees a break The students also visited NYU Abu Dhabi and met for their daily prayers and establishing shorter working with Stern alumni: “Hearing firsthand about living, hours during the month of Ramadan. Of course, the working, and playing there was exciting for us, and it business attire tends to lean towards the more conserva- helped to confirm some students’ decisions to pursue a tive side; no matter the type of business being conduct- career in the region,” she said. ed, it is always better to dress as bankers do in the The students also experienced the cultural differ- US!” ences of doing business in the Middle East. Weiner Both Weiner and El Danab are pursuing work in the said: “Business deals and opportunities often spring region: Weiner is working full time in venture capital from your network, perhaps even more so than in and startups in Qatar, and El Danab interned during other parts of the world. Your reputation is equally the summer at a top global logistics company in important; the business centers of Dubai and Abu Kuwait. She will return to Stern to complete her MBA Dhabi are still relatively small so you do business with but has plans to return to the Middle East. “I want to the same people in your industry over and over help translate to the Middle East what I have learned again.” El Danab said that business in the Middle East and been privileged enough to experience in the US.” ■

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able ere- Stern Welcomes Exchange last Students from India with

suc- Alumni Support By Joey Schmit con- hich In May, Ashwin Bhatia travelled for the first time to heir New York City for an extraordinary two-week experi- to ence. Bhatia was among 36 other students from y in Mumbai enrolled in the India Leadership Exchange (Top photo) Students and e of Program, a new initiative that provides NYU Stern chaperones from Mumbai and visit Rockefeller Plaza. ment undergraduate students as well as students from India (Right photo) Professor the opportunity to share classroom and cultural experi- Venkataramani Srivatsan hief (front center) provided ces- ences across the two global business centers. Many of daily lectures to the the Indian students were sponsored by the Stern School Mumbai students in riti- Stern’s Tisch Hall, the and generous Stern alumni, and could not otherwise pictured in the back- the have afforded to travel to and study in the US. ground. “This experience has been amazing,” remarked multiple countries. We believe that India and the US Bhatia, who attends HR College of Commerce in ows are markets in which this intellectual exchange is par- Mumbai. “There’s a certain energy to this place and ina- ticularly critical.” we’ve received a very warm welcome.” wn- In January, juniors and seniors from Stern will travel The students participated in a range of educational, ofes- to Mumbai, the commercial and entertainment center cultural, and professional development programs over ment of India. “For Stern students, this is a phenomenal their two-week visit, which included daily lectures on st of opportunity and I would encourage every business stu- said global business taught by Stern’s Venkataramani dent to consider applying for this program,” said Yash ran, Srivatsan, clinical professor of economics. In addition to Daga (BS ’09), a recent Stern graduate who helped ctor academic lectures, students visited such cultural institu- welcome the students from India in May. “India is a ain, tions as the Metropolitan Museum of Art and saw some very interesting place to study. As an economy, it is own of New York’s leading corporations, including American starkly different from the US in terms of size, economic h a Express and Standard & Poor’s. “It’s amazing to learn stratification, industry composition, legal structure, ny. so much, and Stern has been fantastic,” said Bhatia. social influences, and even entrepreneurial attitude. Be “The experience means a lot, and we’re going to apply it language barriers, food adjustments, or other cultural what we’ve learned back in India.” learnings, the trip will be an assortment of challenge, that On founding the program, Undergraduate College adventure, and fun.” g of Dean Sally Blount said, “To be an educated leader in Daga added, “The true value of such learning will read the 21st century, students need to know how markets, be immeasurable, and I have no doubt that students of politics, religions, and cultures intersect across ment will come out of this trip as indi- th,” viduals who are more aware and ssor adaptable to social differences, e at more immune to cultural for shocks, and more confident about their own abilities.” ■ O of (From left to right) Amit Gupta (MBA ’99); Sally the Blount, NYU Stern Undergraduate Dean; Chandrika ment Krishnamurthy Tandon, member of the NYU Stern the Board of Overseers and Executive-in-Residence; Indu Shahani, Sheriff of Mumbai; Benoy Thanjan the (BS ’97); Ashish Contractor (BS ’97); and Kush ares Wadhwa (MBA ’02)

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ALUMNI AFFAIRS Alumni News & Events

1. & 6. Alumni mixed and mingled at the Conference. THE BARCELONA 2009: GLOBAL ALUMNI CONFERENCE, 2. Dean Thomas F. Cooley met with Barcelona’s city leaders (from left to right) Josep Maria Cervera, the Honorable Josep M. held June 11 – 13, 2009, was a celebration of Stern’s international community, Basañez, and Andreu Puig Sabanés (MBA ’91). bringing together more than 250 alumni and guests from around the world for a 3. Traditional Spanish music greeted alumni and kicked off the weekend filled with intellectual, cultural, and social opportunities. To recapture the Conference. excitement of the weekend, visit the website at www.stern.nyu.edu/barcelona2009. 4. Friendships are forged at the Global Alumni Conferences: brothers Peter and Paul Seroka (MBA ’05) (pictured on both ends) enjoyed the company of Mark (MBA ’06) and Samantha Bean (center) and Molly Meek (MBA ’04). 5. (From left to right) Professor Al Lieberman; Michael Barker, Co- president and Co-founder of Sony Pictures Classics; and Dean Sally Blount were among the Conference’s esteemed speakers. 7. (From left to right) Dean Thomas F. Cooley, Stefano Russo (MBA ’81), Mark Patterson (MBA ’86), and William R. Berkley (BS ’66), Chairman of the Stern Board of Overseers, celebrate the strength of the Stern community. 8. Juan Antonio Samaranch-Salisachs (MBA ’86) chaired the Barcelona 2009 Host Committee. 9. Flamenco dancers accompanied a guitar orchestra in a special tribute performance at the closing dinner. 1 10.(From left to right) Joan Bloom (MBA ’66), Susan Jurevics (MBA ’96), and Professor Al Lieberman discussed the latest develop- ments in the Entertainment, Media & Technology program during the opening reception at the Hotel Arts. 11. Alumni enjoyed Spanish wine and tapas.

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Alumni Leaders Help Create the Stern of Tomorrow

The Alumni Council comprises the top tier of alumni volunteers and ambassadors of the School, representing a variety of graduation years, degree programs, industries, job functions, and geographic locations. Appointed to a three-year term, Council members serve in a variety of capacities to actively support the educational excellence of Stern and fos- ter community among and between alumni, students, and the School. Representing their peers, council members voice the passions and interests of the community at large, which drives alumni programming for events that occur around the globe. This past year, under the direction of Allan Boomer (MBA ’04), the Council took its leadership to new heights by concentrating its efforts on increasing philanthropy and alumni engagement within the network. Through its collaboration with class agents and alumni committees, the Council works to inspire graduates to reconnect with the Stern community and to adopt a culture of giving – through student

mentorship, recruiting efforts, and financial contri- Alumni Council members Allan Boomer (MBA ’04) (left), Chair, and Chris O’Connell (MBA ’00) bution. In September, the Stern Women In Business connected at an Alumni Council event. (SWIB) Alumnae Committee kicked off a three-year as the Media, Entertainment & Sports Association fundraising campaign to raise $100,000 in support (MESA) and SWIB, and the Council’s Student of the $35 million transformative facilities renova- Affairs Committee. tion known as the Concourse Project. By offering The Alumni Council members, while certainly not only their time, but also their monetary support, some of Stern’s biggest supporters, could not make SWIB alumnae have been able to immediately and such a great impact on the School without the help powerfully impact the lives of current and future of the committee members, alumni volunteers, and students. the Stern community at large. In addition, the Council began an increased The Council will continue to engage more people engagement effort with the student body in order to to volunteer, attend an event, or make a gift to the create a stronger bond between students and alumni, School. Stern’s doors are always open to alumni and and to ease the post-graduation transition, a funda- now, more than ever, the School needs your sup- mental focus especially in this current economic cli- port. To learn more about the Alumni Council, to mate. Alumni volunteers assisted the Council by sup- become involved in a committee, or to find an up- porting programs including MBA Pre-Term to-date listing of all alumni programming world- Orientation, conferences held by student groups such wide, please visit the alumni website at www.stern.nyu.edu/alumni or call (212) 998-4040.

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We hope you will think fondly of your Stern family in this season of joy and giving, and please consider making a tax-deductible gift today by using the reply envelope enclosed in this magazine, visiting www.stern.nyu.edu/giving, or calling 1-212-998-4161. Every gift, no matter the size, has an impact on the School and its students.

Alumni Reconnect at NYU Alumni Day 2009

For the seventh year in a row, hundreds of NYU alumni gathered on Washington Square on October 3, for NYU’s annual Alumni Day. NYU Stern gradu- ates from around the world came back to campus to take part in reunion activities, including five- and 10-year reunion receptions, to reconnect and net- work with former classmates over cocktails and hors d’oeuvres. Members of the MBA Class of 2004 reconnected at the reunion reception. The reunion receptions celebrated the commit- ment of those alumni who fulfilled their Legacy Undergraduate College Sally Blount at the annual pledges and the members of each class who con- Dean’s Luncheon, where she delivered a State of the tributed financially to Stern over the past five years. School Address, and they attended programs show- Alumni also had the opportunity to tour the newly casing some of NYU’s most dynamic and innovative completed Concourse Project – the School’s transfor- faculty and alumni. mative $35 million facilities renovation. Overall, more than 2,000 alumni and friends In addition, alumni joined Dean of the joined in the annual celebration.

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A New Online Alumni Community Join NYU Stern Alumni on is Coming… Stay connected to your Stern friends and to the School through A revitalized online community is coming your way! Based on Facebook. Along with the online alumni community and LinkedIn, Facebook your feedback, the current online community, SWAP, is being offers you the opportunity to tap into the global alumni network and keep in replaced by an entirely new, robust, and more user-friendly plat- touch with friends and contacts. Learn more about your classmates’ net- form by iModules. works and professional contacts, upload your favorite Stern photos, and share links and videos with the community. Not only will you continue to be able to search for friends and Stern’s alumni Facebook page does not replace the online alumni com- classmates, view a comprehensive calendar of global programs, munity, so visit the alumni website often for exclusive career resources, a and register for alumni events, you will also be able to subscribe comprehensive event calendar, and to keep your contact information up to to news updates via RSS feeds from the School, tailor the com- date with the School. munications you wish to receive, and link to many other online To join the NYU Stern alumni Facebook page, visit social networking sites such as Facebook, LinkedIn, YouTube, and www.stern.nyu.edu/alumni or search for the “NYU Stern Alumni – Official Flickr in order to consolidate your networks. Page” in Facebook. Exclusive career resources and enhanced privacy features are just a few of the additional exciting enhancements to this dynamic Update Your Contact Information tool. Regional and affinity group pages will enable you to interact In an effort to be more environmentally friendly and fiscally with thousands of fellow alumni based on your geographic region responsible, many of the School’s communications are now or common interests. sent exclusively via e-mail. Don’t miss out on important infor- Stay tuned for exciting updates in the near future. To learn mation from Stern. Update your contact information by calling more about the NYU Stern online alumni community, visit (212) 998-4040, visiting the website at www.stern.nyu.edu/alumni. www.stern.nyu.edu/alumni, or sending an e-mail to [email protected].

Ninth Annual NYU Stern Alumni Ball

NYU Stern School of Business, Concourse Levels, Tisch Hall

Saturday, December 5, 2009 8:00 – 11:00 p.m.

Participate in a historic moment at the ribbon-cutting of Stern’s transformative campus renovation.

For more information and to RSVP visit www.stern.nyu.edu/alumniball or call the office of Alumni Relations & Development at (212) 998-4040.

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classnotes Send us your news, update your contact information, and access the contact information of your fellow alumni through SWAP, Stern’s online alumni community, at www.stern.nyu.edu/alumni.

David Golan (MBA ’67), of Haifa, Israel, sultant in the medical device industry. In Douglas M. McGraime (MBA ’75), of 1950s has joined the Board of Israel-based Better 1996, he retired after spending 25 years in Wilton, CT, has been promoted to President Martin S. Berger (BS ’52), of New York, G Online Solutions Ltd., which provides sup- management positions at Pfizer Inc. and COO of Combe Incorporated, a global NY, was re-elected to a three-year board term ply chain services as well as mobile and consumer products company located in at Mack-Cali Realty Corporation, a fully inte- radio frequency identification devices. Golan George M. Dillehay (MBA ’72), of White Plains, NY. McGraime most recently grated, self-administered, self-managed real “ is Director and former Chairman of Ridgewood, NJ, has been elected to the served as Executive Vice President and is estate investment trust providing manage- Cimatron LTD. Board of Directors of Business Publications currently on the Board of Directors. is a ment, leasing, development, construction, Audit Worldwide, a global industry and other tenant-related services for a portfo- two A. Bronson Thayer (MBA ’67), of resource for verified audience data and Eva Nove (BS ’75, MBA ’76), of lio of Class A properties. Thonotosassa, FL, was named Treasurer of media. He currently serves on the Board of Charlotte, NC, is taking a sabbatical from Alan the Board of Directors of Florida West Coast Directors for String Letter Publishing, and her private practice, Counseling & EAP Martin Lipper (BS ’58), of Upper Saddle ’02) Public Broadcasting Inc. Thayer is also is a publisher of Acoustic Guitar and Services, to assist US military service River, NJ, has been named to the Board of Chairman of Bay Cities Bank. Strings magazines. members and their families at bases in opp Directors of EPiC Energy Resources, Inc., a Europe, the Pacific, and the US. Houston-based provider of engineering, man- that Richard E. Sorensen (MBA ’69, PhD agement consulting, and training services to Nasser Mohammed Al Nowais (BS man ’73), of Blacksburg, VA, has been elected Sharon Glueck Potts (MBA ’75), of the energy industry. Lipper most recently ’74), of Abu Dhabi, United Arab Emirates, Chair of the Board of Directors of Plastic Miami Beach, FL, published her book, In abili served as Senior Vice President and has been appointed to the Board of Dana Packaging Inc. Sorensen has served as a Their Blood, a suspense novel in which the Research Director of Baron Group USA. Gas, a private-sector gas company in the me w member of the company’s Board since Middle East. Al Nowais is Chairman of the protagonist is forced to confront the reality 1981. He is the Dean of the Pamplin Rotana Hotel Management Corporation, that his parents are not the people he had tage 1960s College of Business at Virginia Tech. Managing Director of the Abu Dhabi Trade believed them to be. ties Centre, and Chairman of Aswaq Dominic Massaro (BS ’61), of the Bronx, Management & Services. John T. Vlachos (MBA ’75), of ed t NY, has been nominated by Governor Manhasset, NY, has joined Reader’s Digest Paterson to fill a vacancy on the New York 1970s The Lewis J. Altfest (MBA ’70), of New Association, Inc. as Vice President, Global State Supreme Court in the First Judicial Philip E. Guldeman (MBA ’74), of York, NY, was named to Barron’s list of the Business Planning and Analysis. for E District. Justice Massaro is currently a judge Arroyo Grande, CA, has accepted an interim 100 Top Independent Financial Advisers for Previously, Vlachos served as Senior Vice on the New York State Court of Claims and position overseeing the financial and 200 2008, in addition to being ranked among President and CFO of Bookspan. the Supreme Court of Bronx County, a posi- accounting functions at Temecula Valley CEO Worth magazine’s list of The Top 250 tion he has held since 1987. Bancorp Inc., which operates 11 full-service Wealth Advisors. He was also recently fea- banking offices in California. Peter S. Kraus (MBA ’76), of New York, the tured in The Wall Street Journal’s article, NY, received the Eigenbrodt Cup Award, the Michael Armellino (MBA ’63), of Fort and “Stand Pat or Rethink.” Altfest is President highest alumni honor, from Trinity College. Lee, NJ, has been nominated to serve on the Mitchell C. Hochberg (BS ’74), of of L.J. Altfest & Co., a wealth management Kraus is Chairman of the Board of Directors prod Board of Directors of Armanta, Inc., a Harrison, NY, has been appointed Senior firm. and CEO at AllianceBernstein. provider of a new generation of business Advisor to Navigant Consulting’s distressed Age intelligence software. He is a retired partner real estate solutions initiative. Hochberg, a Peter A. Howley (MBA ’70), of Jeremy Spector (MBA ’76, LAW ’84), Colo of Goldman Sachs. CPA, was recently nominated to the Board of Petaluma, CA, has joined the Board of Directors of Orient-Express Hotels. of Princeton, NJ, was recently appointed rant Directors for Telecom Council of Silicon Chairman of the American Bar William G. Morton, Jr. (MBA ’65), of Valley and is Chairman of their Entrepreneur Association’s tax-exempt Financing L Boston, MA, has joined Pacholder High Yield Ed McGuinn (MBA ’74), of Greenwich, Forum. Howley is also on the Board of the Committee. Spector is Partner at Mintx, lion Fund Inc. as Director. Previously, Morton CT, has been named President and Chief Independent Institute in Oakland, CA, and Levin, Cohn, Ferris, Glovsky & Popeo PC. served as Chairman and CEO of the Boston Revenue Officer at the Alan S. Harris Group, num recently participated on the panel “Surviving a national human capital management con- Stock Exchange from 1985 to 2001. Claude E. White, III (MBA ’77), of as a Start-Up in this Economic Climate” for sulting firm. inclu the Chamber of Commerce International Claymont, DE, has joined Intellitec Frederic M. Poses (BS ’65), of New York, the Consortium for Entrepreneurs. Solutions as Senior Consultant. NY, has been appointed to head Ascend Grant W. Newton (PhD ’74), of Medford, ened OR, has been appointed to the Board of Performance Materials, a nylon manufacturer Fred S. Zeidman (MBA ’70), of Maria M. Miller (BS ’78), of Dallas, TX, Trustees of Oklahoma Christian University. and recently acquired by the private equity firm Houston, TX, has been named Chairman of has joined Norwegian Cruise Line as SK Capital Partners. Previously, Poses served SulphCo Inc., a developmental stage com- Senior Vice President, Marketing. She most nati Christopher H. Shays (MBA ’74, MPA as CEO of American Standard and as COO of pany that engages in the development and recently served as Chief Marketing Officer itab AlliedSignal. marketing of processes for the upgrading of ’78), of Bridgeport, CT, has been elected to at Dave & Buster’s. crude oil. Zeidman has been a director at the Board of Directors of CIT Group Inc., a Risk William H. Turner, III (MBA ’66), of SulphCo since August 2008. provider of financing to small businesses John C. Stomber (MBA ’78), of New him Upper Montclair, NJ, has been named interim and middle market companies. Shays served Canaan, CT, is a senior executive of the Dean of Montclair State University’s School David Fitzgerald (MBA ’71), of as a Congressman in the US House of newly-formed StormHarbour Partners LP. of th of Business. Turner most recently served as Brandon, VT, has been named acting Representatives, representing the 4th District Previously, Stomber was President, CEO, cess founding Dean of the College of Business at President and CEO of ArthroCare Corp. of Connecticut, from August 1987 to and Chief Information Officer of Carlyle Stony Brook University. Fitzgerald is principally employed as a con- January 2009. Capital Corporation. com

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Joseph P. Malfesi (MBA ’79), of rently President and CFO. Rockville, MD, has been appointed Chief Super Goal-Directed s, Technology Operations Officer at Amtrak, Robert L. Bowen (MBA ’82), of where he is responsible for IT infrastruc- Weston, MA, has been appointed Vice From early on, Superna Kalle y – ture. Previously, Malfesi held a similar President and CFO of Abiomed, Inc., a me position at Hughes Network Systems. provider of heart recovery products pro- knew what she wanted. “When I rts viding circulatory support to acute heart was applying to NYU Stern, one of fers Christine Lindahl Reilly (MBA ’79), failure patients. the essay questions asked: Where of Berkeley Heights, NJ, has been hon- do you see yourself in five years?” ored as one of the Top 25 Nonbank Vita A. Cassese (MBA ’82), of Forest she said. “I answered that I would ace Women in Finance by US Banker Hills, NY, has joined Exigen Capital, a love to be working in the global tel- in Magazine. Reilly is President of CIT Small transformational private equity fund, as evision industry, primarily concen- try Business Lending. Operating Partner. Previously, Cassese served as the Vice President, Business trating on India.” She was spot on. he Tom M. Wirtshafter (MBA ’79), of Development and Strategy and Innovation, Today, as Senior Vice President of very New York, NY, has been named President at Pfizer Inc. In 2007, she was named one International Networks at Sony the of American Portfolios Financial Services of the top 25 chief investment officers of Pictures Television (SPT), Kalle (APFS), a member FINRA/SIPC firm, and the year by CIO Insight magazine. provides leadership to SPT’s televi- American Portfolios Advisors Inc. Prior to sion networks business in India, Superna Kalle (MBA ’99) - being named President, Wirtshafter had Deane M. Dray (MBA ’82), of New an- been a board member and consultant for Canaan, CT, has joined the equity research Multi Screen Media Private Ltd., which includes the channels ut I APFS since 2004. team of FBR Capital Markets as Senior Sony Entertainment Television, MAX, SAB, and PIX. r Vice President within its Diversified Kalle works with each channel’s management to ensure Industrials group. Previously, Dray was a profitability and establish overall business priorities and new y, 1980s senior industrial analyst with Goldman initiatives for the channels in the region, and she is responsible v- Michael V. Dukmejian (MBA ’80), of Sachs. for expanding the portfolio of Indian channels and content ar- New York, NY, has been named Publisher of Bloomberg Markets magazine, the Simone O. Fevola (BS ’82), of New across multiple distribution platforms in the US. “I’m so for- monthly publication for investors and York, NY, was named President of Winch tunate, because every day is different. I work closely with the i- business professionals. Advisory Services of Appleton, Wisconsin. very talented and entrepreneurial management of each of our - Previously, Fevola was President of a channels, as well as with the functional experts that we have Laurie C. Kamhi (BS ’80), of financial planning and investment man- here in Los Angeles,” she said. Brooklyn, NY, has recently been recog- agement firm in Wisconsin’s Fox Valley. But Kalle didn’t just serendipitously land in her dream job. nized by Worth as a Worth Top 250 “I was working in investment banking and didn’t particularly e is Wealth Advisor and by Barron’s as a Top Tony Kao (MBA ’82), of Hartsdale, NY, ies 1000 Advisor. Kamhi is a private wealth has been promoted to Chief Investment enjoy myself,” she explained. “I thought the best way to n advisor with Merrill Lynch. Officer with GM Asset Management, where change careers and get into the entertainment industry was to he has worked for 26 years. Previously, get an MBA from a world-class business school.” Kalle enrolled Kevin Fisher (BS ’81, MBA ’05), of Kao was Senior Managing Director and in business school full time and simultaneously accepted an rs Staten Island, NY, was appointed Vice Head of Global Public Markets for GMAM. internship at Viacom, where she worked in the marketing t- President and Head of Business department of Nickelodeon. “It worked out well,” she said. “I Development with CSC Trust Company of Amar P. Singh (MBA ’82), of ing was recruited at Stern to join Sony Pictures Entertainment’s et- Delaware, a subsidiary of global services Monmouth Junction, NY, has joined firm Corporation Service Company and a Spectrum Pharmaceuticals as Chief Corporate Development Group. One day, I mentioned to the ’.” provider of corporate trust, escrow, and Commercial Officer. Previously, Singh head of one of our operating divisions that I may be ready to as- agency services. served as Chief Commercial Officer for move to an operating role.” The next day, she received a call new Novacea. offering her a position working with television channels in Carol M. Joseph (BS ’81), of New India at SPT. “Given that I’m Indian-American, that was a York, NY, has been hired as Partner with Louis F. Cimino (MBA ’83), of ife Blank Rome LLP, in the law firm’s Real Ramsey, NJ, has been promoted to COO of definite ‘yes,’” she said. ter Estate Development Group. Joseph cur- W.H. Reaves & Company, Inc., an employ- Kalle attributes much of her success to the skills she learned w rently serves on the Boards of Directors of ee-owned investment management com- at Stern, especially from her finance and corporate governance er the Jewish Community Center in pany that specializes in utility, telecommu- classes. “Meeting so many people from around the world at Manhattan, Hadassah Foundation, nications, and energy equities. Cimino Stern helped me transition to an international media career, Change the Truth Foundation, and the was previously its Vice President. too,” she said. Jewish Women’s Archive. Outside of work, Kalle spends time with her family and S. Andrew Siegelstein (MBA ’83), of ile reads voraciously. “I actually am doing what I said I wanted to ds,” Kevin Sheehan (MBA ’81), of Lloyd Humble, TX, has been named General Harbor, NY, was appointed CEO of Manager for BrightSource Construction do in my business school essay. How many people can say Norwegian Cruise Line, where he is cur- Management Company, a subsidiary of that?” she said with delight.

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classnotes

Mark Connelly (BS ’85, MBA ’89), of Boeing, Boeing! New York, NY, has joined Sterne Agee’s equity research department, where he will serve as Gary Baker has had as diverse a career as they come, with just Managing Director and Senior Research one employer. With many Boeing management positions behind Analyst, covering the agricultural sciences, him, Baker is currently the CEO and Director General of Ural commodity chemicals, and paper sectors. T Boeing Manufacturing (UBM), a joint venture between Boeing Gary Katcher (MBA ’85), of Port St. Lucie, by J and Russia’s VSMPO-AVISMA that produces titanium parts for FL, has been promoted to Head of Global Boeing’s 787 Dreamliner jets. His MBA is similarly diverse: a Fixed Income with Knight Capital Group, Inc., product of the TRIUM Global Executive MBA Program, a three- a financial services firm that provides elec- A school international degree. tronic and voice access to the capital markets of th Since kick-starting his 29-year career with Boeing in 1980, across multiple asset classes for buy-side, Broa sell-side, and corporate clients. Previously, Baker climbed the corporate ladder wearing many hats. Prior to Katcher was Senior Managing Director. ente his appointment at UBM in April 2007, he held numerous man- play agement positions in manufacturing, quality assurance, program Giorgio Stock (BS ’85), of Milan, Italy, has Gary Baker (MBA ’03) has management, and technical integration, culminating in his prior been promoted to Executive Vice President ings position as Director of Global Partners Field Operations. “The biggest challenge in working and Managing Director for Disney Channels, maj for such a large company,” he noted, “is not getting lost or pigeonholed into a specific dis- Europe, Middle East, and Africa, and will lead cipline or function.” He advises employees to play an active role in their careers and decide The Walt Disney Company’s portfolio of televi- try. sion channels, including Disney Channel, what they want to get from their experience. “I wanted to learn to build airplanes, experi- grew Playhouse Disney, Disney XD, and Cinemagic. (rec ence customer service, examine sales, and work with suppliers to get a well-rounded and He will also serve as a Disney representative diverse view of the company,” he said. “Boeing is an amazing company to work for and has on the board of SRTL, Disney’s joint venture expe afforded me many opportunities to grow into my current position.” with RTL Group. Stock joined The Walt Disney ann Baker’s career has been abundantly rewarding and has offered him the chance to work Company in 1997 and has been Senior Vice deca globally in Europe and Asia, including the UK, Spain, and now Russia. “Bringing this enter- President and General Manager, Italy, since of C 2005. prise together for UBM has been incredibly gratifying,” he said. He is also the Founding bein President of the International Aerospace Quality Group, which is an industry association Kevin R. Byrne (MBA ’86), of Brooklyn, Gret implementing global improvements in aerospace. “I constantly strive to improve the quali- NY, has been promoted to Executive Vice who ty of our professional community,” he said. President of AXA Equitable. AXA Equitable Life year An Arizona native, Baker was living in the UK when he decided to enroll in the inaugu- Insurance Company is a financial protection S ral class of the TRIUM Global Executive MBA Program, which offers a curriculum that company and one of the nation’s providers of blends a world-class business education from three prominent universities: NYU Stern, the life insurance, annuity, and investment prod- the London School of Economics and Political Science, and HEC School of Management, Paris. ucts and services. Rais arts “I chose the program because of its global perspective on business,” he said, “and because Lisa M. Carlton-Wilson (BS ’86), of New it allowed me to tap into three excellent educational systems. I am very grateful for my expe- York, NY, was recently married to William is a rience at NYU Stern. I have been able to use most of my lessons in my business career and Bainbridge. She is the founder of In-Site mov refer back to them often.” Communications, an investor relations firm in the Time is a favorite hobby of Baker’s: He is a horologist and a collector of clocks. When he New York. violi is not punching Boeing’s clock, he enjoys spending his hours with his wife and five children. purs Daniel H. Schulman (MBA ’86), of Warren, NJ, has joined the Board of Directors in m BrightSource Energy, Inc., a developer of John O. Barres (MBA ’84), of Newark, DE, financial holding company. of Flextronics International Limited, a provider ics a large-scale solar thermal energy plants. was recently named by Pope Benedict XVI as of advanced design and electronics manufac- real the fourth Bishop of the Diocese of Allentown. Scott Kauffman (MBA ’84), of Palo turing services to original equipment manu- just Thomas L. Tishman (WSC ’76, MBA He is the first priest in more than 100 years Alto, CA, was named President, CEO, and facturers. Schulman is CEO and Director of ’83), of Mendham, NJ, was promoted to from the Diocese of Wilmington to be named member of the Board of SourceForge, Virgin Mobile USA Inc. He is also a member com Assistant Vice President in Merrill Lynch’s a bishop. Inc., an IT community-driven media and of the Board of Directors of Symantec and it,” Global Wealth Management Group. e-commerce company. Most recently, serves on the Board of Trustees of Rutgers New Previously, Tishman served as Senior Melissa R. Brown (MBA ’84), of New Kauffman was President and CEO of University. neve Financial Advisor. York, NY, has been appointed Managing PopTok, a start-up that facilitates the per- Director, Chief Investment Strategist, and sonalizing and digitizing of television, Sandra J. Zimmerman (MBA ’86), of here David Weild, IV (MBA ’83), of Bronxville, Head of the newly formed institutional movie, and music video snippets for use Holliston, MA, was recently appointed CFO of are NY, has been named to InsideVenture’s clients division with Wayne Hummer in everyday conversations. He remains a Nyer Medical Group Inc. Zimmerman is a bett Corporate Board. Weild is Founder of Capital Asset Management Company, a subsidiary member of PopTok’s Board of Directors. member of the American Institute of Certified enjo Markets Advisory Partners. of Wintrust Financial Corporation, a Public Accountants.

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ive, John A. Kritzmacher (MBA ’87), of Far Kathleen A. Corbet (MBA ’89), of New for its Consumer Tax Group. Gregg A. Fisch (BS ’92, LAW ’96), of sident Hills, NJ, has been elected to the Board of Canaan, CT, has joined the Executive Santa Monica, CA, has been named Partner Directors of InterDigital, Inc. Kritzmacher is Advisory Board of Rapid Ratings Lynn A. Tyson (MBA ’90), of Hutto, TX, in the labor and employment department in Executive Vice President and CFO of Global International, an independent ratings, has joined PepsiCo as Senior Vice President the Los Angeles office of Seyfarth Shaw. while Crossing Limited. research, and analytics firm. Corbet is the of Investor Relations. Previously, Tyson ened Founder and Principal of private equity and served as Vice President, Investor Relations, Mary J. Jolda (MBA ’92), of Caldwell, NJ, st six Cheryl S. Peress (MBA ’87), of New York, strategic consulting firm Cross Ridge for Dell Inc., where she was responsible for has joined Marcal Manufacturing, LLC as ues NY, has recently launched ArtistsinAuction, a Capital. Dell’s relationships with investors and finan- Senior Vice President, Marketing. Previously, p, company that assists emerging artists selling cial analysts, and for strategic direction of Jolda worked for Reckitt & Colman, Inc. their work via online auction. Gregg R. Kam (MBA ’89), of Short the investor relations function. Hills, NJ, has been promoted to Senior Ronald S. Nersesian (MBA ’92), of . He Naomi Brezi (BS ’88), of Plumsted, NJ, Vice President and CFO of International Craig A. Weynand (BS ’90, MBA ’96), Santa Rosa, CA, has been named Senior Vice y of has been appointed Sales Director with Specialty Products, a specialty chemical of Cockeysville, MD, has joined NuWave President and General Manager of Agilent nan- VIPGift, a provider of corporate and consumer company based in Wayne, NJ. Investment Management LLC’s management Technologies’ electronic measurement group. ula- incentive programs and prepaid card solutions committee as Managing Director of Nersesian is currently Vice President and to Fortune 500 companies. Prior to joining Yuri M. Piltser (MBA ’89), of Business Operations. Previously, Weynand General Manager of the group’s wireless VIPGift, Brezi worked with ITAGroup and MTM Hallandale Beach, FL, has been named was Director of Investor Services at Graham business unit. s the Recognition. Team Leader and Senior Relationship Capital Management, L.P. n Manager of Wholesale Banking for Sun Jason N. Ader (SCPS ’91, MBA ’93), of ng William S. Burns (MBA ’88), of National Bank’s northern region. Piltser is Bradley G. Ball (MBA ’91), of Chatham, San Francisco, CA, has been named Director go? Shorthills, NJ, has been appointed CFO of also responsible for business development, NJ, has joined Ladenburg Thalmann & Co. of Las Vegas Sands Corporation. Ader is the Somerset Hills Bancorp, the holding and par- as well as managing portfolios and usher- Inc., a subsidiary of Ladenburg Thalmann Founder and CEO of NYC-based hedge fund ll a ent company for Somerset Hills Bank. Burns ing customers through the loan and credit Financial Services Inc., as Managing Hayground Cove Asset Management and What was previously the CFO of TenRock Capital approval processes. Director of Equity Research. Previously, Ball Chairman and CEO of India Hospitality What LLC, a commercial mortgage lender. was Director of Equity Research and Senior Corporation. dant Elizabeth J. Satin (MBA ’89), of New Specialty and Consumer Finance Analyst at Alan G. Levin (MS ’88), of New York, NY, York, NY, has been appointed Senior Vice Citigroup’s Citi Investment Research. Lisa N. Fyfe (BS ’93) of New York, NY, has been appointed Executive Vice President President and Head of Corporate was recently married to Roger Lane in ting and CFO of Endo Pharmaceuticals. Most Development and Mergers & Acquisitions, Ada M. Healey (MBA ’91), of Seattle, Holicong, PA. Fyfe is currently the Art “The recently, Levin was Executive Vice President North America, with Wolters Kluwer, a WA, has been appointed as Director of the Director of Henry Holt and Company, a pub- all and CFO of Moksha8 Pharmaceuticals. global information services and publishing Seattle branch of the Federal Reserve Bank lishing division of Macmillan in New York. n- company focused on professionals. Satin of San Francisco. Healey is Vice President upid Michael T. O’Hea (MBA ’88), of is a veteran media and information indus- of Real Estate for Vulcan, the Seattle-based Jeffrey J. Kollin (MBA ’93), of ngs Northport, NY, has published an E-book, The try senior investment banker. corporation owned by Microsoft’s Paul Livingston, NJ, has joined Rothstein Kass as One Hundred and One Secrets of Castle Allen. Director in the Advisory Services group. Prior Macawber, with Treeguard Publishing LLC. to joining Rothstein Kass, Kollin was Senior 1990s Fritz H. Hofheinz (MBA ’91), of Beverly, Vice President, Head of Business James Randy Schwingen (MBA ’88), of Stephen M. Alpart (MBA ’90), of MA, has joined Best Doctors, Inc. as Vice Development, at R3 Capital. Cliffside Park, NJ, has been promoted to Armonk, NY, has joined Prudential Real President and Medical Director. Previously, Director of Corporate Actions Products and Estate Investors as Managing Director. Hofheinz worked at UpToDate, an informa- C. William Kraus (MBA ’93), of New o Editorial Operations with Wolters Kluwer Most recently, Alpart was Managing tion resource for physicians. York, NY, was recently married to Julie Beck. st. Financial Services. Previously, Schwingen was Director and Co-head of Opportunistic Kraus is a developer and consultant who Senior Product Manager for corporate actions Lending in the debt funds business at George D. Landau (MBA ’91), of focuses on the use of historic buildings as solutions at the same firm. Capmark Investments. Vancouver, Canada, has been appointed part of urban revitalization in Connecticut. Vice President of Business Development Kenneth L. Sperling (MBA ’88), of Theodore Nacheff, II (MBA ’90), of with TYRX, Inc., a certified medical device James P. Stoeffel (MBA ’93), of Orange, CT, recently rejoined Hewitt Short Hills, NJ, has joined FBR Capital manufacturer that works in the commercial- Montclair, NJ, has joined Royce & Associates, a global human resources con- Markets Corporation as Senior Vice ization of implantable medical-pharmaceuti- Associates, LLC, investment advisor to The sulting and outsourcing company, as its President within institutional sales. cal devices. Royce Funds, as Portfolio Manager. Prior to Global Health Management Consulting Leader. Previously, Nacheff was employed with joining Royce, Stoeffel co-founded and man- Sperling is also the Chairman of the Advisory Goldman Sachs. Lance LaVergne (MBA ’91), of aged a hedge fund for Rebus Partners. Board of the University of Connecticut’s Montclair, NJ, has been named Vice te Healthcare Management Program. Erik E. Prusch (MBA ’90), of Austin, President and Chief Diversity Officer of New Ron Bentsur (MBA ’94), of Tenafly, NJ, TX, was named President and CEO of York Life. has been appointed CEO of Keryx Michael Zientek (MBA ’88), of Borland Software Corp, a company that Biopharmaceuticals, Inc. Previously, Bentsur YU Albuquerque, NM, has been selected to serve provides platform-neutral software Eric F. O’Toole (MBA ’91), of Montclair, served as CEO of XTL Biopharmaceuticals. nce as the Chairman of the Greater Albuquerque development tools to simplify and NJ, was promoted to Senior Vice President Chamber of Commerce for 2009 to 2010. accelerate application development. of Sales at The Dannon Company. Lawrence C. Busch (MBA ’94), of New Zientek is Vice President of The Gap’s corpo- Prusch joined Borland from Intuit Inc., Previously, O’Toole held the position of Vice York, NY, was named one of Worth maga- s of rate shared service center in Albuquerque. where he was Vice President of Finance President of Business Development. zine’s Leading Wealth & Legal Advisors in the

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ates a private practice in New York. Managing With Style Thomas Carter (MBA ’95), of Rye, NY, Avid about fashion, Christine Morena never dreamed she joined Morgan Joseph & Co. Inc. as an ana- would be paid to spend her days at Saks. The Executive Vice lyst and marketing representative. Previously, President of Human Resources for Saks Inc., Morena found her- he was a managing director with Pali Capital, where he headed its structured products La self there thanks to a career marked by flexibility and willingness activities. be to roll with the punches. “The rate of change in the world is so Sc frequent that the plan you set forth today may be one that you Sean Dolan (MBA ’95), of Larchmont, NY, se can never implement,” she shared. “You have to be open to was appointed President of the Asia-Pacific learning, growing, and experiencing the world around you if you region with Alcatel-Lucent. Dolan is currently Ins want to be successful.” the company’s COO of the Asia-Pacific region. M Alcatel-Lucent delivers voice, data, and video M Morena, a double degree holder from NYU Stern, joined Saks communication services to end-users. after a successful 28-year run at AT&T, where she began her dir Christine Morena (BS ’76, career following her 1976 graduation from Stern’s Tamer El-Rayess (MBA ’95), of Flushing, leg MBA ’81) Undergraduate College. When she accepted the AT&T position, NY, has been named to the Board of Directors of res she was one of very few females in a male-dominated field. “As a woman in an engineer- EPiC Energy Resources, Inc., a Houston-based Ins provider of engineering, management consult- ing-orientated company, it was all about trying to look and act like your male counter- tha parts,” she recalled. “You never wanted your colleagues to think ‘she’s not really serious ing, and training services to the energy industry. El-Rayess also serves as the Global Head, of about her career because she’s married or she has children.’” In contrast, today’s organi- Commodities Finance & Capital Investments, at zations support women and offer many work-life balance initiatives. “Although, there’s still UBS AG. He is also the founder of a private an the issue of the glass ceiling,” Morena noted. equity fund focused on various industry sectors Co At AT&T, Morena was able to build her career in a cross-functional way, working in including energy. sales, product management, marketing, and, finally, human resources. AT&T was com- Ov mitted to a philosophy of placing people in positions in which they had little experience in Dorothy A. Hill (MBA ’95), of Manhasset, rem NY, has joined Colcomgroup, a strategic busi- pe order to make them well rounded. “I was able to continuously grow and develop my skills ness advisory firm, as Director, Global Business br to become a general manager and senior leader in the company,” Morena said. When she Development. left AT&T as Senior Vice President of Human Resources, Morena was responsible for the pe strategic support of 40,000 people in 60 countries. Alan Hughes (MBA ’95), of Fairfield, CT, has ris In 2007, armed with impressive career experience, a solid business education – now been named Chief Information Officer and wi Senior Vice President of Information Services of including a Stern MBA – and her love of shopping, Morena transitioned to Saks. “I value ex my time at Stern,” she said. “It set me on not only a solid career path, but also on my per- Blue Cross Blue Shield of North Carolina. Previously, Hughes was CIO of GE Financial’s ma sonal path – I met my husband during my undergraduate career, and our daughter earned Global Risk Management organization and also low her undergraduate degree from Stern in 2007,” she said. served as CIO of the company’s Distribution sc Today, in appreciation of her Stern experience, Morena volunteers as a mentor for Finance unit. to students in the Undergraduate College. “When I was in the program at Stern, most of an my classmates and I were focused on working in finance,” she said. “One of the ideas I Brooks S. Kaufman (MBA ’95), of New try to instill in current students is to think outside the box – be open to and embrace York, NY, has been named Vice President of ke Finance with Soltage, LLC, a renewable energy the unknown.” company that develops, finances, owns, and an operates solar energy generating power stations Spring/Summer 2009 issue. plus apparel. Previously, Fogarty was Patrizia Porrini (BS ’94, MBA ’95, on client structures across the US. Previously, Re Managing Director at Alvarez & Marsal. MPhil ’01, PhD ’02), of Whitestone, Kaufman was with Banc of America Securities, cu Daniel Y. Doo (MBA ’94), of Belle NY, recently published Above the Board: the investment banking arm of Bank of America lon Corporation. Mead, NJ, has joined CastleOak Securities, Chin-Yee R. Lap (MBA ’94), of Hong How CEOs Build Ethical Companies, pr L.P’s equity capital markets team as Kong, has established the hedge fund which includes CEO perspectives on how Managing Director. Doo formerly ran the Gemini Capital. Previously, Lap was the companies can be more ethical or come Paul Knepple (MBA ’95), of Point Pleasant, de index arbitrage proprietary trading desk at Head of Structured Credit Markets Asia for back from an ethical breach. NJ, joined Stone & Youngberg as Vice my Nomura Securities. Nomura. President of its Taxable Fixed Income Group. inv Stone & Youngberg is one of the oldest private Feliz B. Reznick (BS ’94), of New ue James Fogarty (MBA ’94), of Ardsley, Peter Morgan (BS ’94), of Hoboken, NJ, York, NY, has been appointed to the investment banks operating in the US. NY, has been appointed President, CEO, has been named Partner at Sonneschein Board of Directors of American Scientific de and member of the Board of Directors of Nath & Rosenthal. Morgan had been Resources, Inc. Reznick practices law at Maryann Kuzel (MBA ’95), of Montclair, NJ, bo Charming Shoppes, Inc., a multi-brand Partner and Chair of the hedge fund group firms Cadwalader, Wickersham & Taft and has been named President of STAR Healthcare, He apparel retailer specializing in women’s at Thacher Proffit & Wood. Rosenman & Colin LLP, and also oper- the healthcare specialty unit of Omnicom

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Group’s STAR Marketing. Kuzel was instru- Manoj Chouthai (MS ’97, MBA ’00), J. Kurt Kaline (MBA ’98), of New York, Jeff P. Fidacaro (MBA ’99), of Summit, n mental in the formation of STAR Healthcare. of Jersey City, NJ, was named to NY, was named Managing Director of NJ, has joined Susquehanna Financial Omnicom is a global advertising, marketing, Computerworld’s list of top IT leaders. Commercial Mortgage-backed Securities Group, LLLP’s equity research team. Prior to and corporate communications company. Chouthai is PSEG’s Vice President, Trading with Maxim Group LLC. Kaline was joining Susquehanna, Fidacaro was Vice y Information Technology, and Chief previously Managing Director with President and Senior IT Hardware Analyst at Victor H. Bravo Martin (MBA ’95), of Information Officer. Winthrop Realty Partners. Merrill Lynch. Estado de Mexico, Mexico, has been named CEO of Mexican airport operator Grupo Richard A.C. Coles (MBA ’97), of Daniel J. Mullineaux (MBA ’98), of Kenneth A. Freelund (MBA ’99), of Aeroportuario del Centro Norte, S.A.B. de C.V., Harrison, NY, has been appointed to the Westport, CT, has been appointed Millburn, NJ, has joined Merriman Curhan known as OMA. Previously, Martin served as Board of Directors of Global Consumer Managing Director and Global Head of Ford Group, Inc. as Senior Vice President, OMA’s CFO. Acquisition Corp. Coles is Co-managing Emerging Markets Fixed Income with Institutional Equity Sales, based in its New d Principal of the Emmes Group of Knight Libertas LLC, a subsidiary of Knight York office. Prior to that, he was Director at Frank C. Oh (MBA ’95), of New York, NY, is Companies and is a member of their Capital Group and an institutional fixed- Rodman & Renshaw, and an institutional heading the newly-opened New York office of investment committee. income broker-dealer providing trade exe- equity salesperson at CIBC World Markets Stifel, Nicolaus & Co., a subsidiary of Stifel cution, investment research, and capital and JP Morgan. Merriman Curhan Ford Financial Corp., a full-service regional broker- Andrea Kallies (BS ’97), of Virginia markets services across a broad range of Group is a financial services firm focused on y age and investment banking firm. Previously, Beach, VA, has joined the Analysis Group, fixed-income securities. fast-growing companies in the clean tech, Oh worked for Goldman Sachs. LLC as its COO. Previously, Kallies was consumer, Internet, media, and healthcare e Senior Director for Convergys Corporation. Jamie L. Nash (BS ’98), of Hoboken, sectors. Matthew W. Traina (MBA ’95), of NJ, has become a Member of the law firm Newcastle, WA, has joined the financial spon- Tim P. Long (MBA ’97), of Ridgewood, of Kleinberg, Kaplan, Wolff & Cohen, P.C. Kevin B. Jennings (MBA ’99), of New sors group of Piper Jaffray & Co. as NJ, has been named Senior Equity Analyst Nash joined the firm as an associate in York, NY, has been appointed Assistant Managing Director, where he will lead the in the technology team with BMO Capital 2004. Deputy Secretary of the Office of Safe and e firm’s coverage of West Coast financial spon- Markets, the investment and corporate Drug Free Schools by Education Secretary sors. banking arm of BMO Financial Group. Daniel Seiner (MBA ’98), of Miami Arne Duncan. Jennings is the Founder and Long will cover companies in the wireless Beach, FL, has joined Ladenburg Thalmann Executive Director of the Gay, Lesbian, and Patrick J. Fabbio (MBA ’96), of Basking equipment and data networking industries. Financial Services Inc. as Managing Straight Education Network (GLSEN). Ridge, NJ, has joined Ikano Therapeutics Inc. Director. Previously, Seiner worked at as its CFO. Previously, Fabbio served as Jeffrey S. Mann (MBA ’97), of Rye, BroadSpan Capital, LLC, where he was Matthew C. Michaels (MBA ’99), of t Senior Director of US Life Cycle Management NY, has joined Jefferies & Company, Inc., Managing Partner and Director. Frisco, TX, has been promoted to Vice and Base Business with Sanofi-Aventis, a the principal operating subsidiary of President of Administration at Conifer pharmaceutical company. Jefferies Group, Inc., as Managing Director Kevin J. Windorf (MBA ’98), of Revenue Cycle Solutions, Inc. Prior to lead- within the firm’s derivatives sales group. Westfield, NJ, has been elected President ing Conifer’s administration, Michaels Brendan Hartman (MBA ’96), of Mount of the Financial Communications Society, a served two years as Senior Director of Kisco, NY, has joined Royce & Associates, Joan Van Hise (PhD ’97), of New York, not-for-profit organization for financial Operations Planning and Strategy for Tenet LLC, an investment advisor to The Royce NY, was named Teacher of the Year by services marketers. Windorf serves as Patient Financial Services and five years Funds, as Portfolio Manager. Prior to joining Alpha Sigma Nu, an honor society of Director of Marketing & Client Strategy for leading Tenet’s e-business strategy depart- Royce, Hartman co-founded and managed a Jesuit higher education institutions. Van BMO Capital Markets, the investment bank- ment. hedge fund for Rebus Partners. Hise is Associate Professor of Accounting ing arm of Bank of Montreal. at Fairfield University’s Charles F. Dolan Philip V. Volpicelli (MBA ’99), of New rs Susan L. Jurevics (MBA ’96), of Forest School of Business. David Cohen (MBA ’99), of New York, York, NY, has joined Cantor Fitzgerald & Co. Hills, NY, is a recipient of the 2009 NY, will join Paragon Capital Partners, LLC, as the firm’s first analyst in high-yield and the Advertising Working Mothers of the Year Darren T. Duffy (MBA ’98), of New a merchant banking firm based in New distressed research. Previously, Volpicelli Award from Working Mother magazine and York, NY, was recently married to Arlene York, as Partner. Previously, Cohen was worked at Goldman Sachs. me- Advertising Women of New York. Jurevics is Seungyun Hong. Duffy is the Chief Executive Director in the M&A group at s, married with two children and works as Vice Content Officer at Lipper, the mutual funds Morgan Stanley. - President of Corporate Marketing at Sony research unit of Thomson Reuters, a finan- 2000s es, Corporation of America. cial information company in New York. Jessica (Pearson) Coleman (BS ’99), David L. Bassuk (MBA ’00), of of Long Beach, NY, recently published her Livingston, NJ, has joined AlixPartners as Carl D. Brown (MBA ’97), of Brooklyn, NY, Scott M. Hall (MBA ’98), of Mountain first book, Crisis Communications – Managing Director. Previously, Bassuk was has has joined Royce & Associates, LLC, invest- Lakes, NJ, has been named Managing Weathering the Storm. This in-depth vol- on the Board of Directors at Kurt Salmon ment advisor to The Royce Funds, as Portfolio Director of North America with ACTIV ume touches on all aspects of handling a Associates. ed Manager. Prior to joining Royce, Brown co- Financial, a supplier of fully managed low- crisis, from prevention to management to founded and managed a hedge fund for Rebus latency market data solutions. post-crisis communications. Christopher Claps (MBA ’00), of Red Partners. Bank, NJ, was promoted to Senior Vice nces Judy E. Hong (MBA ’98), of New York, Chris Dury (MBA ’99), of San Ramon, President of Quantitative Analysis at nge Russell P. Certo (MBA ’97), of Ridgefield, NY, is the 2009 recipient of the Financial CA, has been appointed Vice President of Contemporary Healthcare Capital LLC, a s CT, has joined Broadpoint Capital, Inc. as Co- Times and StarMine Award for Excellence Product with GetJar Networks, a mobile provider of senior mortgage, mezzanine debt, head of its rates group. Previously, Certo was in Investment Analysis. Hong has been application distribution and developer com- and equity to healthcare service companies. Managing Director at RBS Greenwich Capital. with Goldman Sachs for 11 years. munity.

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Jonathan Scott Ross (MBA ’00), of NYU Man with a Plan Beverly Hills, CA, was recently married to Anne-Marie Lee Boysen. Ross is a sales N When George W. Madison enrolled in the undergraduate pro- manager for theatrical distribution at Fox Searchlight Pictures. cent gram at NYU, he already had a personal business plan up his ship sleeve for becoming a senior executive at a major investment firm. Matthew Horan (BS ’01), of East Mic He knew that he was going to have to work hard if he wanted to Norwich, NY, was recently married to who play in the big leagues. Danielle Lewin. Horan is an account spe- duc During his first semester at NYU, as a history and political sci- cialist at C&B Consulting, an employee- whi benefits consulting firm in Syosset, NY. ence student, he applied for an entry-level accounting job at a small rela publishing firm to pay for tuition. But he had never taken an Jim Mui (BS ’01), of New York, NY, was incl accounting course. “I went to the NYU bookstore and bought an recently married to Dr. Linda Law. Mui is a bon accounting book so that I could speak knowledegably during the financial analyst at JPMorgan Chase in day interview,” he said. Madison spent the next two years maintaining a Manhattan. George W. Madison (BS ’75) mod full course load while working full time. At the end of his sophomore fina year, he transferred to Stern. “It just made more sense with my professional background,” he Ann M. Sheridan (MBA ’01), of New explained. After graduation, Madison went on to further his education by obtaining both an York, NY, and her husband, Erich, recently MBA and a JD from Columbia University. welcomed a baby boy, Tyler. After law school, he clerked for the Honorable Nathaniel R. Jones at the US Court of Matthew W. Swope (MBA ’01), of Appeals for the Sixth Circuit in Cincinnati, then did a stint at Shearman & Sterling as an Morris Plaines, NJ, has joined Broadpoint A associate. In 1987, he joined Mayer, Brown & Platt, where he became the first African- Capital Inc.’s Debt Capital Markets confer American elected to Partner. In 1997, Madison had an opportunity to put his business degree Division as Vice President and Fixed Financ to greater use as Executive Vice President, General Counsel, and Corporate Secretary at Income Analyst. Previously, Swope was Federa Comerica. He was then recruited for a similar role at TIAA-CREF in 2003. “My back- Research Analyst, Portfolio Manager, and Partner at Washington Corner Capital Thom ground shaped who I am – there was always someone significant at each stage of my life the go to mentor me,” he said. Management. large f With his recent nomination as General Counsel at the Department of Treasury by President Boris G. Todorov (BS ’01), of New packe Obama, Madison has the opportunity to work for his greatest mentors – the President and York, NY, has been appointed Director of Treasury Secretary Timothy F. Geithner. “I knew I wanted to take on this challenge when I was Risk Management with Troika Dialog. MBA s recruited,” he said. “The world economy was faltering, and major banks were collapsing. I Previously, Todorov was Vice President of offered thought of my children asking me [in the future], ‘Daddy, what did you do to help?’ I Global Risk Management for Alternative ing to wanted to help stabilize the financial system and reinvigorate the economy.” Investments at JP Morgan. panels As General Counsel, Madison will manage approximately 2,000 lawyers and 1,600 staff Christopher J. Allen (MBA ’02), of Edwar members. Together, he and his team confront, head-on, the legal issues the government faces Garden City, NY, has joined Pali Capital Willia in the current financial crisis, a broad range that includes the public debt; revenue and cus- Inc. as Senior Equity Research Analyst, Capita toms laws; international and domestic economic, monetary, and financial affairs; and law covering the exchange and market security Schoo enforcement and the financial war on terror. “The Treasury is essentially the CFO of the structure industry, which he previously specia government, and we need to ensure that the causes of the crisis are addressed, the holes covered for Bank of America. in financial regulation are plugged, and that everything related is secure so that this Depos doen’t happen again,” he declared. Alan T. Ennis (MBA ’02), of Scotch Rosen Plains, NJ, has been appointed CEO and When Madison isn’t at the Treasury, he enjoys spending his time with his two daughters. President of Revlon, Inc. Previously, Ennis And when he can, he heads to the “green” for a quick round of golf. was the CFO and President of Revlon International. In Thomas J. Deierlein (MBA ’00), of West Ronald Doria (MBA ’00), of Chatham, unit of AIG Commercial Insurance and one of Dana Guido (MBA ’02), of port Harrison, NY, has been named COO of NJ, has joined Fred Alger Management, the nation’s Surplus Lines carrier. Hillsborough, CA, has joined Merriman ness Simulmedia, Inc., a television marketing Inc., as Vice President, Senior Analyst, cov- Curhan Ford Group, Inc.’s equity research company pioneering the use of data model- ering the healthcare sector. Previously, Brian P. Fitzgerald (MBA ’00), of team as Senior Vice President. Most offic ing and predictive technologies to improve Doria was a senior equity analyst with Ridgewood, NJ, has joined UBS Investment recently, Guido was Senior Equity Research resp the effectiveness of “on-air” program promo- Mazama Capital Management. Bank as Director. Previously, Fitzgerald Analyst covering the US steel sector at role tion. Previously, Deierlein was Senior Vice worked at Banc of America Securities, where Barclays Capital and Lehman Brothers. reco President, Global Corporate Development, at Peter Eastwood (MBA ’00), of Norwell, he spent the past three years covering the Chai Millward-Brown, the WPP-owned media MA, has been promoted to President and Internet and mobile Internet companies. Graham Michener (MBA ’02), of New Dean research firm. CEO of Lexington Insurance Company, a York, NY, was appointed to Managing Will Law 46 Sternbusiness 185769_KA_printerSpreads:SternMag09fallSpreads.qxd 10/1/09 10:26 PM Page 9

Director of RSR Partners, an executive search comprehensive investment and financial Mark McLaren (MBA ’07), of New The story is a futuristic, eco-fantasy adven- and corporate governance recruiting firm. company based out of Seoul, Korea, and York, NY, was named National Accounts ture written for the tween audience. e Previously, Michener was Executive Director affiliated with SoftForum. Manager for Agency and Advertiser Sales - in the global banking and markets practice of at Mediamark Research & Intelligence Patrick T. Yip (MBA ’07), of Beijing, onal Russell Reynolds Associates. Jan Grabowski (MBA ’05), of Munich, (MRI), a provider of magazine audience China, was recently promoted to CFO of Germany, was recently promoted to and multimedia research data. Schulze Global Investments, a global emerg- Thomas Oh (MBA ’02), of Darien, CT, has Manager at Bain & Company. ing markets private equity firm with opera- joined Sandler O’Neill in the firm’s fixed Edward Repking (MBA ’07), of tions in the US, China, and Ethiopia. income group. Sandler O’Neill + Partners, Lynda F. Madera (BS ’05), of Seaford, Stamford, CT, has been promoted to Tax L.P. is a full-service investment banking firm NY, was recently married to Daniel Vaillant. Partner at KPMG. Jessica M. Resler (MBA ’08), of di- that provides comprehensive advisory and Madera currently works in the business and Brooklyn, NY, and Matthew Demanett y transaction execution services to the financial finance department of Morgan Lewis & Greg J. Sheppard (MBA ’07), of New (MBA ’08), of New York, NY, founded f industry. Bockius. York, NY, was recently married to Muffin Cupcake and Associates LLC while Marybeth Ferringo. Sheppard is Senior they were in the Langone Part-time MBA ’s Amelia A. Sadowsky (MBA ’02), of New Arindam Nag (MBA ’05), of London, Manager for New York Open, the small Program. Muffin Cupcake is a strategic , York, NY, was recently married to Thomas UK, has been promoted to Deputy business credit card division for American brand development firm for emerging busi- Murphy. Sadowsky works at Pfizer Inc., Managing Editor with Dow Jones Express. nesses. ued where she is Senior Manager in one of the Newswires. Previously, Nag was Senior company’s finance divisions. Columnist for “Heard on the Street.” Linda Y. Tsai (MBA ’07), of New York, Dena M. Imbesi (MBA ’09), of New dis- NY, was recently married to Richard York, NY, was recently married to Edward on Lewis Boreas Yuming Fan (MBA ’03), Simon J. Samaha (MBA ’05), of Weinert. Tsai is a stock analyst at MKM Faccio. Imbesi is an executive compensation of Harrison, NJ, has been appointed CFO for Haddonfield, NJ, has been appointed Partners, a securities research firm. consultant for PricewaterhouseCoopers LLP. China-Biotics. Prior to joining China-Biotics, President and CEO of Summit Medical of Fan was Vice President and Senior Equity Group, the largest independently operated, Lyneisha E. Vaughn (MBA ’07), of Anthony K. Odierno (MBA ’09), of New Analyst for Brean Murray, Carret & Co., multi-specialty medical practice in New Brooklyn, NY, was recently married to York, NY, was recently named a new board where he covered the Chinese healthcare Jersey. Most recently, Samaha served as Edward Perez. Vaughn is a business man- member of the Wounded Warrior Project, a industry. Senior Executive Vice President and Chief ager for the Swedish publishing company non-profit organization whose mission is to Medical Officer at Cooper University Bonnier. honor and empower wounded soldiers. n Natalia Schargorodsky (MBA ’03) and Hospital in Camden, NJ. Odierno was wounded while serving as ion Pablo F. Kralj (MBA ’03), of Buenos Kathleen S. Wilson (MBA ’07), of Captain in the United States Army. He now ted Aires, Argentina, recently welcomed the birth Kineret C. Baumberg (MBA ’06), of New York, NY, recently published a novel, works in operations for the New York ng of their child, Uma. Wayne, NJ, has joined Bentley Associates, Rumer & Qix: The Race to Terra Incognita. Yankees. LP, as an analyst. The firm focuses on mid- Aziz I. Ansari (BS ’04), of Bennettsville, dle market and emerging growth compa- o nies within the travel and leisure, energy, SC, is starring in NBC’s sitcom “Parks and Helen De Scipio (BS ’40) Recreation” and in the movie “Funny healthcare, technology, retail, and business People.” and financial services sectors. Arthur W. Harrigan, Sr. (BS ’42, MBA ’48, PhD ’59) Allan J. Boomer (MBA ’04), of Somerset, Alexander A. Hammet (MBA ’06), of Perry Luntz (BS ’51) NJ, and wife, Jeanell, recently welcomed a New York, NY, has been named Senior Vice baby boy, Avery Braxton. Boomer currently President and Chief Actuary of Delos Mario Carotti (BS ’55) serves as Chair of the NYU Stern Alumni Insurance Group, which provides program Council. business insurance. Previously, Hammett Francis X. Coleman, Jr. (BS ’55) was Senior Vice President with Arch. Alexander M. Droznik (BS ’04), of In Memoriam Donald T. Vandeusen (BS ’55) Brooklyn, NY, has been appointed Affiliate Douglas A. Costa (MBA ’07), of Dallas, Program and Business Development TX, was named COO of Cardiovascular James Barwick (BS ’57) Manager for Cyweb Holdings Inc.’s Specialty Association of North Texas. GovernmentAuctions.org website. Previously, Previously, Costa was a management con- Jerome Kahn (BS ’57) mnus Droznik held a position with GE Capital. sultant to the healthcare industry with d the Ziegler Capital Markets and Deloitte Irwin Scherago (LAW ’61, MBA ’62) tern’s Laura M. Smith (MBA ’04), of New York, Consulting. spoke NY, was recently married to Thomas H. Joseph Meilan (MBA ’77) ue of Winner, Jr. Smith is the Associate Director of Melissa J. Feldman-Desjardins Audience Development and Analysis at (MBA ’07), of New York, NY, with her ositive Stuart C. Gruskin (MBA ’83) ning. Condé Nast Portfolio. husband, John, and daughter, Olivia Rose, welcomed baby, Alex Michael, on March All- David Yoo (MBA ’04), of Leonia, NJ, has 17, 2009. Robert J. Milacci (MBA ’04) where joined SF Investment as Managing Director and Head of the Americas. SF Investment is a

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PastPerformance

emeritus of management and sociol- Pugel, mindful of the dramatic Cutting Loose ogy, played keyboard and sang. requirements of performance, said Of the original group, only Pugel he takes care that his onstage garb from the and Rogers still play with the band. reflects the progress of each set, Other current members include Luís starting with a Hawaiian shirt and Classroom Cabral, William R. Berkley Term ending with a black leather vest. He Professor of Economics and added, “I jump around onstage, but By Marilyn Harris Business, who plays a mean sax and there’s no guitar smashing.” sings; vocalist Melissa Schilling, pro- Over the years, FAB has played The year was 1973, the place – fessor of management and organiza- host to a number of faculty illumi- Lansing, Michigan. Long-haired tions; adjunct professor Mark nati, who have brought their own rocker and Michigan brand of magic by State junior Tom Pugel “redirecting” the lyrics was staring down his of well-known tunes to future. Would he want to suit the Stern audience. try for the big-time as a Memorable moments bass guitarist with his have included Edward rock band, or continue Altman, Max L. Heine on the academic track? Professor of Finance, In the end, Pugel rendering his custom chose the latter, going on version of the Beatles’ to earn his PhD in eco- “Taxman” and Statistics nomics at Harvard and Professor Aaron starting his 31-year- Tenenbein transforming career (and counting) as The current line-up for Stern’s FAB (Faculty And Band) features Professor Emeritus David Rogers “Summertime Blues” professor of economics (front), (from left to right) Vice Dean Tom Pugel, Professor Melissa Schilling, Joe Granata, Professor into “Math and Stat Luís Cabral, and EMBA students Barbara Granata and David Edwards. and global business at Blues.” At the end of NYU Stern. “No regrets,” he said. Sirower, percussionist; and current the go-go ’80s, Pugel recalled, Vice “The nice thing is, teaching is per- EMBA students Dave Edwards, gui- Dean Ingo Walter and Roy Smith, forming, so a piece of that stayed.” tar, and Barbara Granata, trumpet Kenneth Langone Professor of Still, once a rocker, always a rocker, and vocals, whose husband Joe, a Entrepreneurship and Finance, and for the last two decades, Pugel professional drummer, lends his billed as “Masters of the Universe,” has had it both ways: In 1988, he skills to the band. showed up in tuxedoes and belted co-founded Stern’s very own faculty Pugel, the band’s sparkplug, out new lyrics to Gilbert & band, which always brings the house manages its gigs and organizes Sullivan’s “When I Was a Lad.” In down at the annual Executive MBA rehearsals at a studio near 10th the mid-’90s, then-Dean George party and other School events. Avenue. “It’s not easy because we’re Daly crooned “Stand by Your The band is currently called FAB, all so busy,” he said. The annual Dean,” and perhaps equally unfor- ostensibly for Faculty And Band, but EMBA party has evolved into a bat- gettable, during one holiday party so named so that during performanc- tle of the bands, and while the scene the band performed in Santa beards es, “We yell out, ‘We are FAB,’ every isn’t exactly a mosh pit, “We defi- and wraparound sunglasses. so often,” said Pugel. Over the years, nitely get people up and dancing,” In the past several years, the the rolling list of members includes a said Pugel. band has only picked up momen- roster of talented polymaths: In the The play list is not all hard rock. tum. “We have more gigs than early days, Richard Levich, professor Rogers, a jazz pianist who performs ever,” said Rogers. “It creates a of finance and international busi- professionally, said he has lobbied sense of community, and the stu- ness, kept the beat on drums; former successfully to introduce more jazz dents get a kick out of it.” As do the professors Tom Gladwin and Harry standards into the mix, and with professors who make the music – in (Chip) Bowen cooked on guitars and Cabral’s influence, the band now class and out. ■ vocals; and David Rogers, professor includes some bossa nova as well. MARILYN HARRIS is editor of STERNbusiness.

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