Comment Letters

July 18, 2002

Mr. Richard Grasso
Chairman and CEO
New York Stock Exchange
11 Wall Street
New York, NY 10005

Dear Dick:

I am writing on behalf of the Committee on Investment of Employee Benefit Assets (CIEBA) to commend the work of the New York Stock Exchange Committee on Corporate Accountability and Listing Standards. The recommended changes to NYSE listing standards will help strengthen the system of checks and balances in corporate governance and provide an important step in the restoration of investor confidence.

CIEBA is the voice of the Association for Financial Professionals (AFP) on employee benefit plan asset management and investment issues. As you know, CIEBA is a nationally recognized forum for ERISA-governed corporate pension plan sponsors on fiduciary and investment matters.  Our members represent 120 of the nation's largest corporate pension funds, managing more than one trillion dollars in assets on behalf of sixteen million plan participants. 

We have reviewed the recommendations from our viewpoint as institutional investors and fiduciaries charged with investing pension assets in the sole interest of the beneficiaries of our plans.

CIEBA applauds the NYSE for taking a bold and leading role in raising the bar in corporate governance.  You have properly taken advantage of your unique position as the widest, deepest, most efficient securities market in the world to tip the "regulatory arbitrage" in favor of the investor -- codifying many best practices designed to enhance the role of boards of directors in protecting the interests of the shareholders.

CIEBA supports the recommendations on enhanced listing standards that will be presented to the NYSE Board of Directors.  As you move to finalize the listing standards that will arise out of these recommendations, we would like to suggest two ideas that may be helpful to the Exchange, in the interests of making a strong set of proposals stronger.

First, the move to strengthen and clearly delineate the roles of independent directors and key committees is very positive.  As institutional investors, however, we believe that the full board – with its majority of independent directors -- must retain ultimate accountability for oversight of the corporation on behalf of shareholders.  We encourage the Exchange, in drafting its final listing standards, to ensure that the strengthened key committees do not result in lessening the accountability of the full board.

Second, the role of the director who will lead the executive sessions of the board is far more important than the identification of one particular person in that role.  It may properly be a role that rotates among specified board members (e.g. committee chairs) or rests with the chair of a particular committee.  As investors, we are most concerned with clear communication of the process by which that position is filled. 

Once again, we thank the NYSE for taking strong and decisive action to enhance shareholder protections.  We are available at your convenience to discuss any of these matters.

Sincerely,

Robert E. Angelica
Chairman and Chief Executive Officer
AT&T Investment Management Corporation
Chairman, CIEBA