American Express 2002 Annual Report Download - page 7

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enforce stricter penalties for those who do wrong are a
positive development. We support the Sarbanes-Oxley
legislation, the New York Stock Exchange guidelines
and other measures to strengthen corporate gover-
nance and restore public trust in business institutions.
Many of the steps required by the new regulations
were already in place at American Express. Therefore,
we did not have to make significant changes to our
corporate governance structure or practices. While
rules are essential, I believe the true foundation of
corporate credibility resides within the values of a
company and its leaders. American Express has been
guided through its 153-year history by a strong values
system that emphasizes integrity and trust at all levels
of the organization. We have strived to remain true to
these values over the years. When we made mistakes
along the way, we faced up to them and learned from
them. We expect all of our people to act with the
highest standards of integrity in everything they do,
and we manage our business in a manner that helps to
ensure that is the case.
Shareholder Returns
The results we delivered for 2002 contributed to
shareholder returns that surpassed the major market
indices and most of our peer companies. For the year,
American Express’ total shareholder return was up 0.1
percent, compared with declines of 15 percent for the
Dow Jones Industrial Average, 22 percent for the S& P
500 Index and 15 percent for the S& P Financial Index.
Of course, it was difficult to find much to cheer about
in the equity markets this past year, with continued
volatility and lower values due to concerns about
the economy, the global political situation and corpor-
ate ethics. While I am not satisfied by our stock
performance on an absolute basis, I am pleased that
we performed as well as we did relative to the market
overall and to our peers.
With our improved business results and stronger
financial position, the company reinstated its share
repurchase program in June.
I5AXP I
TOTAL RETURN TO SHAREHOLDERS_ American Express posted a slight gain (0.1 percent) in total
shareholder return during 2002. This was in contrast to declines of 22 percent for the S&P 500 Index
and 15 percent for the S&P Financial Index. Over the past five-year period, American Express’
cumulative return to shareholders outperformed both the S&P 500 and S&P Financials.
❙American Express ❙S&P Financial Index ❙S&P 500 Index
$50
$100
$150
$200
02010099
98
97
$123.54
$113.29
$ 9 7.1 2
Returns compounded on a monthly basis