Ran & Citigroup

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  • Topic: Citigroup, Citibank, MasterCard
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132 PART I Strategy and the Nonmarket Environment
The Rcsinforest Action Network
RAN was founded in 1985 with the mission of prot
ecting tropical rainforests and the human rights of
people living in them. RAN used tools such as
citizen protests, media, nonviolent civil disobedie
nce, and publications to bring awareness to the
issues and pressure governments, corporations, and
lending institutions. RAN had about two dozen
employees, all in the United States, organized in
three departments: operations, development
(fundraising), and campaigns. RAN had a full-time
media specialist who interacted with the news
media and participated in campaign planning.
Within the campaigns department, RAN typically
had a campaign manager for each campaign and
used an organizing staff of about five to support
whichever campaign was active at the time.
In the mid-1990s RAN changed its focus from
public policy to the private sector with the objective of
changing the practices of companies with environm
entally destructive practices. RAN executive direct
or Michael Brune said, “Companies were more
responsive to public opinion than certain legislatures
were. We felt we could create more democracy in the
marketplace than in the government.”
RAN’s Global Finance Campaign
Selecting a Target

In late 1999 RAN was concluding a successful 2-year
campaign (led by Brune) targeting Home Depot,
which had agreed to end by 2003 the sale of wood
from endangered forests. For the Global Finance
Campaign, RAN planned to use a model similar to
the one used for Home Depot—target a large,
brand-oriented, U.S.-based multinational company
that had a strong retail presence, was a leader in its
industry, and had a key role in facilitating the
destruction of old growth forests and supporting
extractive industries. Because RAN was a small
organization with the goal of shifting the practices of
entire sectors, not just individual companies, it relied
on the ripple effect of targeting a market leader.
One company stood out as the best target—
Citigroup, the world’s largest bank. Citigroup was
the leading global, emerging market project finance
bank, and developing country project finance bank.
Citigroup also had a key role in a number of specific
projects that alarmed RAN, such as the Camisea
pipeline in Peru (Citigroup was the financial advisor
on the project but did not directly fund it) and the
Chad-Cameroon pipeline under construction by
ExxonMobil Chevron, and a consortium of central
African oil companies.2 In researching Citigroup’s
involvement, RAN relied on data from Dealogic’s
ProjectWare, a database of project finance deals.
In 2000 Citigroup had net income of $13.5 billion
on revenues of $111.8 billion and had customers
in over 100 countries and territories. Citigroup’s
activities included global consumer banking, global
corporate and investment banking, global investment
management and private banking, and investment
activities. Citigroup’s global consumer group offered
banking, lending, investment services, and credit
cards to customers in over 50 countries and tern-
tories. The global consumer group reported core
net income of $5.3 billion on $30.4 billion of revenues
in 2000.
Citigroup had a public image and a brand to
protect (in particular, its large consumer banking
operation and credit card business), which made it
an attractive target. Ilyse Hogue, RAN’s campaign
manager for the Global Finance Campaign, said:
Citigroup had poured $100 million into its
brand image, most recently on its “Live Richly”
marketing campaign, which was predicated on
the notion that “there is more to life than
money.” We saw a company that was investing a
lot in making the public believe that they opera
ted in line with conirnon social values. Part of
Citi’s vulnerability was the juxtaposition of what
it articulated to the public with what we saw on
the ground from Citi’s finance activities.
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