Did Lehman Bros’ Board of Directors Advise Firm’s Management to Take Action?

(NewsVisual, powered by IntellectSpace) -- In an effort to shore up its financial stability in the wake of the fallout from the subprime mortgage crises, Lehman Brothers Holdings Inc (NYSE:LEH), the country’s fourth-largest investment-banking firm, sold $3 billion worth of preferred shares of its stock, The New York Times reported.

The recent collapse of The Bear Stearns Companies Inc (NYSE:BSC) has fed rumors that Lehman Brothers could be the next big firm to bite the dust.

Since July, the share value of Lehman’s stock lost 42 percent of its value, The Times said.

The rumors themselves, regardless of whether they were true or not, could have impelled Lehman’s Board of Directors to counsel the firm’s Senior Executives to take decisive action in order to restore investor confidence.

“Regulators like Christopher Cox, Chairman of the Securities and Exchange Commission, attributed troubles at Bear to a lack of confidence, not capital, leaving open the possibility that other banks could fall prey to a similar crisis of confidence,” The Times article reported.

It seems likely Lehman’s Directors share Cox’s interpretation of the risks associated with investor anxiety.  But investors will also want to know if the decision-makers possess sound judgment.

NewsVisual decided to create an IntellectSpace Knowledge Map of Lehman’s Board of Directors in order to determine whether its members represented an adequate brain trust for helping to advise the firm through this crisis period.

The Knowledge Map shows that several of the Directors have connections to illustrious business-related institutions and corporations that could help them to better comprehend the true state of the economy.

For example, Lehman CEO/Chairman Richard S Fuld Jr also serves on the Board of Directors of the Federal Reserve Bank of New York; Lehman Director Christopher Gent also serves as the Chairman of GlaxoSmithKline Plc; and Lehman Director Roland A Hernandez, the retired CEO/Chairman of the Telemundo Group, also currently serves on the boards of MGM Mirage, The Ryland Group Inc, and Wal-Mart Stores Inc.

To see the details of other Lehman Directors, click here for an interactive and fuller version of this IntellectSpace Knowledge Map.

(Note: the information contained and presented in Knowledge Maps is public information from the Securities and Exchange Commission of the United States of America).