Unlike the Nov. 15 editorial “Dimming futures in Chicago,” the Chicago Board of Trade is on the path to a bright future. The CBOT’S restructuring proposal contains many elements of today’s post-Enron thinking on corporate governance, all designed to further modernize our business structure to better meet the needs of our customers. Our proposal provides for critical standards, including a balance between management and the board of directors, active and engaged directors with minimum required holdings, creation of a transparent nomination process led by a board-governance committee and shareholder rights that make boards responsive.
Our record trading volume in 2002 is the result of the tremendous pool of liquidity and flexible access to our markets that we provide to customers worldwide. Our strategy of providing the best of both open auction and electronic trading platforms and letting our customers choose where they put their business will continue because, quite simply, it is working.
The business disciplines instituted in the past 18 months by Chairman Nickolas Neubauer and former President David Vitale will he carried forward by Vitale’s successor, Bernard Dan. Our business model is much stronger, our cash position has greatly improved and the discipline that our employee team has placed on itself to work more efficiently on behalf of the institution all are assets that will continue to grow.
The CBOT recognizes that the financial services industry continues to evolve, driven by technology, consolidation and regulatory changes. Our exchange is cognizant of what is occurring in the world, and we are determined to position the CBOT to uphold our value propositions of integrity, transparency, openness and innovation. By delivering on these propositions to our customers, members and member firms, the CBOT’s position in the marketplace will be strengthened.
The Tribune’s editorial failed to note the new era of openness that exists among the CBOT, Chicago Mercantile Exchange and the Chicago Board Options Exchange, as evidenced by the business alliance created by the three exchanges, called OneChicago, for the trading of single stock futures. While it is too early to predict an outcome for this marketplace, the exchanges through the OneChicago alliance have demonstrated to the global derivatives industry what can happen when this enormous pool of talent and resources are brought together. Other cost-saving initiatives between these institutions in this new era have benefited exchange memberships and customers alike.
The Chicago Board of Trade, like the city’s other financial exchanges, recognizes its value to Chicago as an anchor of the local economy in terms of revenue generation and job growth, and we plan to keep that mantle of leadership. Our strong business discipline and sound financial planning have allowed us to reduce fees to our customers, keep a healthy bank balance and make strategic investments to both trading platforms so that our products and markets can continue to grow. With our new management team, we plan to complete the many important projects we have started so that we can continue to build on the strong foundation necessary for a successful future for the CBOT.
