Travelers 2001 Annual Report Download - page 7

The St. Paul Companies 2001 Annual Report 5
Our Commitment: To Create Shareholder Value
The St. Paul’s overriding objective is to create shareholder value.
This means we will continuously review our businesses to assure
that each is generating an attractive return, is likely to continue
to do so and has an appropriate amount of capital allocated to it.
We will also maintain a relentless focus on long-term profitability.
We recognize that creating shareholder value is not an accidental
byproduct of business —it’s our job.
We believe there are five operational keys to building shareholder
value in our organization:
First, by achieving excellence in execution throughout our
organization.Excellence in our day-to-day work —underwriting
and claims handling in our insurance operations and, at Nuveen,
in the delivery of consistent, superior investment returns—
is the first step to delivering superior financial results.
Second, by building a high degree of efficiency in everything
we do. To generate competitive returns we must achieve and
maintain an expense profile that is among the best in the industry.
To do otherwise would place us at a competitive disadvantage.
Third, by attracting, retaining and rewarding the best talent.
Ultimately, our competitive advantage lies in the quality of our
leadership and the people who work throughout our organization.
We have already restructured our compensation program to
significantly reward our best-performing employees.
Fourth, by a commitment to our distribution force. We depend
upon independent agents and brokers in our insurance operations
and broker-dealers in our asset management business. Our goal
is to make The St. Paul and Nuveen the preferred markets for their
distributors through better and more profitable relationships.
And fifth, by continuously exploring strategic opportunities
in our businesses. Risks change, market conditions fluctuate
and new opportunities emerge. Companies that are committed
to building shareholder value are nimble and agile, able to
spot opportunities and capitalize on them.
Looking Ahead
We are optimistic as we look to 2002. We have addressed the
key strategic business issues that confronted the company,
have positioned ourselves for significant profitability and have
aggressively addressed our cost structure. And we have done all
this with a great sense of urgency. The St. Paul will continue to
benefit from the accelerating price increases in the commercial
insurance marketplace, and I am extremely confident in the
leadership team we have in place.
In closing this letter, I would like to acknowledge and thank my
predecessor, Doug Leatherdale, who will retire from the board of
directors in May. Doug provided nearly 30 years of distinguished
service to the company and left the organization with a legacy of
strong values and ethics, superb community relationships, and —
most important—strong businesses from which we can deliver
shareholder value.
I also want to welcome two new directors who joined the board
in May of 2001: Carolyn Byrd, chairman and chief executive officer
of GlobalTech Financial, a financial services company, in Atlanta;
and Janet Dolan, president and chief executive officer of Tennant
Company, a manufacturer of floor maintenance equipment, in
Minneapolis. They are serving our board and our company very
well. Finally, I would like to note that Lawrence G. Graev, president
and chief executive officer of the GlenRock Group, LLC, a private
equity investment firm, in New York City; and John A. MacColl,
The St. Paul’s general counsel, have been nominated as candidates
for election to the company’s board of directors.
Jay S. Fishman
Chairman and Chief Executive Officer
March 1, 2002