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Corporate Titan

After a storied career that’s spanned many arenas, Richard Parsons is glad to be moving along. But don’t call it retirement. He has too much going on in his life.
Mervyn Rothstein
From the Print Edition:
Jeremy Irons, March/April 2013

(continued from page 3)

Why not? Parsons is former chairman of Citigroup and former chairman and chief executive of Time Warner, with a personal worth estimated at $100 million. He is sitting in a 47th-floor meeting room on West 57th Street in Manhattan at Providence Equity Partners LLC, the financial firm where he is a senior advisor. If Parsons had been four blocks downtown at the Grand Havana Room—the exclusive members-only cigar club where he is chairman of the board, and where celebrities have their own humidors and compatriots from the world of high finance have been known to hang out—he most probably would have a cigar in hand.

“I’m happy right now, that’s for sure,” he says. “I’m a happy guy anyway, but right now I’m in a good place. I have spent 45 years of a professional life doing a lot of interesting things, and having a fair amount of success, and putting myself into a position where I can now do not things I have to do but things I want to do. Almost everything I’m involved in now is something I want to be involved in, because it speaks to something inside me.”

Parsons is one of the few African-Americans to have headed a Fortune 500 company, and he was chief of two of them. He was chairman of Time Warner from 2003–2008 (and CEO from 2002–2007) and chairman of Citigroup from 2009 to 2012. From the late 1980s to the mid-1990s, he ran the Dime Savings Bank.

In 2008, he was appointed a member of President-Elect Obama’s Transition Economic Advisory Board. He is also chairman of the Apollo Theater Foundation in Harlem, and a trustee of the Museum of Modern Art and the American Museum of Natural History. He is on the boards of Estée Lauder, the Lazard financial firm and Madison Square Garden. And that’s only a partial list of his credentials, past and present.

He is 64 now—he turns 65 on April 4—and despite his many current activities, he says he considers himself retired. He is still an imposing, if soft-spoken, presence, all six-feet-four of him. His beard is graying, and these days his midsection offers evidence of the good life. The image he presents is one of serenity, of humility, with the humorously self-deprecating demeanor of someone with nothing left to prove.

His smile is wide and relaxed. Descriptions often given of him in his long career include the words “smooth,” “diplomatic” and “friendly giant,” and this day there will be examples of them all.

He will convey these as he discusses his encounter with Fidel Castro; the vineyard he owns in Italy and the Brunello di Montalcino it produces; his plans for a new jazz club in Harlem; the commission he was appointed to head by New York Governor Andrew Cuomo that was created to help improve student education; his rise from the streets of Bedford-Stuyvesant, Brooklyn and South Jamaica, Queens, to the highest levels of corporate finance; his and his grandfather’s connection with the late Vice President and New York Governor Nelson A. Rockefeller; his view of the financial world, and America’s future; his own assessment of the pluses and minuses of his career, especially his years at Time Warner and Citigroup; his take on race relations; and the cigars, and the cigar club, he loves.

“I was introduced to cigar smoking by Fidel Castro,” Parsons says. “I had been a cigarette smoker, but when my son was born 40 years ago, I quit.” Then, “through a meeting orchestrated in the mid-1990s by Peggy Dulany, David Rockefeller’s daughter, I met Castro. He was up here for the United Nations. He took a shine to me and I sort of took a shine to him, as a personality. And he insisted that I try one of the cigars he had with him, a Cohiba Esplendido.” Parsons “fell in love with it. There’s an elegance, almost a romance.”

He smokes two or three cigars a week. “I tend not to smoke during the weekday because I’m busy. I smoke on weekends, or whenever I go to the Grand Havana Room.” His favorite—“am I allowed to incriminate myself or would you advise against it?”—is “a good Cuban cigar. I still like the Cohiba Esplendido. And the Montecristo. I’m a No. 3 guy. No. 2s are good but I’m a No. 3 guy. If I’m up for a quick smoke I’ll do a Robusto. And I like Romeo y Julieta.” For non-Cubans, he prefers “the OpusX. And Davidoff makes a good cigar.”

A more business-oriented pastime is the vineyard he owns in Montalcino, in the middle of Tuscany. “That’s a fun project. We don’t make money, but we make a lot of wine. The vineyard is about 20 acres, and we also rent a couple of other fields in the area, so we have some variety.” Its name is Il Palazzone, and the main wine is a Brunello di Montalcino, 100 percent Sangiovese. “Brunello di Montalcino was the first officially recognized D.O.C.G. [Denominazione di Origine Controllata e Garantita] wine in Italy. It’s a very virile, elegant red wine.” Brunello di Montalcino, he says, is considered perhaps the best Italian red.

“We’ve been going along making about 1,500 cases a year,” he says. “It’s been kind of a hobby. Now that I’m retired and have some more time to put into it I’m trying to turn it into a real business. I define a business as something that makes money, not loses money. I built a new cantina, which is basically a winery, on the property. I rented these additional fields and I’m going to take the production up to about 4,500 cases.” (If you want to buy his Brunello retail in the U.S. it’s mainly at Italian Wine Merchants in New York City, near Union Square; it’s also available at restaurants, including Del Posto, and at the Grand Havana Room.)

Il Palazzone also produces extra virgin olive oil. And there’s a blended wine, a Super Tuscan, named for his parents, Lorenzo & Isabelle (his father was an electrical technician, his mother a homemaker).

Another major project, in fact a passion, is the renovation and reopening of Minton’s Playhouse, a legendary club in the history of jazz, where Dizzy Gillespie, Charlie Parker and others pioneered the development of bebop. Minton’s, at West 118th Street and St. Nicholas Avenue in Harlem, had closed in the 1970s, reopened in 2006 and closed again in 2010.

Parsons says he wishes to create the kind of jazz supper club he has always wanted to go to—and take his wife to, for good music—as well as to help “create momentum around the economic revitalization of Harlem.”

And “I’m chairman of the Jazz Foundation of America. It’s a philanthropy—we raise money and take care of old jazz musicians, blues musicians who have played all their lives, but because of the structure of that business they don’t have pensions, and they can’t play anymore, they don’t play around town anymore, because there are no gigs. We found all these jazz musicians from the 1940s and ’50s, still up in Harlem. They’re 70, 80 years old and can’t get work. We look after them.“

The idea, he says, is to “bring Minton’s into the 21st century in terms of a venue and let’s give some of these old jazz musicians a place to come and gig again.” Minton’s is to reopen at its old 118th Street spot; around the corner on St. Nicholas, where there was a vacant space, will be a restaurant, the Cecil, named for the hotel that formerly occupied the site. Restaurateur Alexander Smalls will be executive chef for both.

Renovation work, “basically a gut renovation,” is going on. “It’s a multimillion-dollar project” (his own money so far, though he will probably recruit other investors) “to create the kind of venue you want, so people will come not only from around the city but around the country and the world and see what’s going on at the world-famous—at least in the jazz world—Minton’s. I’m hoping to open in June.”

Then there’s the Education Reform Commission, which New York Governor Andrew Cuomo appointed him to as chairman last year to suggest ways to improve student performance. “I have several passions. One is some form of public service, particularly education. Because I was just a kid from Bedford-Stuyvesant. I got lucky but I was in a position to get lucky because I got an education. That was the key to success.”

For Parsons, “this is a labor of love, a labor of assumed responsibility. If you’ve been lucky enough to extract from this culture and society the kind of good living I’ve been able to, you really ought to try to do something to make sure the way is paved for others to do the same.”

Parsons was born and grew up, one of five children in his family, in the Bedford-Stuyvesant section of Brooklyn, and then, from age six, South Jamaica, Queens. He attended public schools, and, when he was only 16, the University of Hawaii. Why Hawaii?

He didn’t get into his first choice, Princeton—he was wait-listed.  (“My mother always told me, you don’t have any money, you can’t go to Princeton, you have to go to C.C.N.Y.”). And although he was accepted at City College of New York, “I was leaving home!”
“I sat next to in high school, in the physics lab, this girl, she was from Hawaii and she was stunning.” He was accepted. He had played basketball at John Adams High School (“we were the Queens champions”), and Hawaii “said you can play basketball for us.”

So he went halfway across the Pacific, “had a lot of fun, played ball, met the woman who was my girlfriend, who I ultimately married, who is my wife today. And it was time to shape up or ship out. She said I ought to think about law school, because I would argue with a fence post. So I went to Albany Law School. I had been a goof-off in college, but now I was married and my wife was working to put me through law school, so I actually applied myself and did reasonably well.” Actually, he graduated at the top of his class, in 1971.

Soon, he was working for Nelson A. Rockefeller, New York’s governor at the time. “And it was not for several years that I told him that my grandfather had been head groundskeeper on the Rockefeller estate,” Kykuit, in Westchester County, north of New York City.

“My grandfather, on my mother’s side, died when I was three, so I never really knew him. But my mother used to tell stories about having met the original John D. Rockefeller when she was a little kid, and gotten a dime from him. And she knew Nelson, as a kid.”

Rockefeller was named vice president in 1974 by President Gerald Ford, and Parsons went along; he wound up working as a senior White House aide under Ford. When Parsons returned to New York, Rockefeller said “why don’t you live on the estate for a while?” Parsons says. “I wanted to go into private law practice. He said, you work for me in the family offices. You’ll be my lawyer. I’ll give you a little house on the estate. You can stay there and you can look around and see where you want to land. So we go back to the estate and I told him the story of my grandfather. He didn’t know about it, because my grandfather’s last name was Judd.”

In 1977, Parsons was hired by Patterson, Belknap, Webb & Tyler, a top white-shoe law firm in Manhattan. He rapidly advanced, making partner  in two years. Eventually, he became managing partner, leaving in 1988 for the Dime Savings Bank. Dime led to Time Warner (in 1995, he was named its president) and then to Citigroup.
Looking back at his tenure at Time Warner, he says, “I gave myself a B.

“I think we did OK. We got the company through some tough passages and back on its feet.” But dealing with the difficulties of the $350 billion merger with America Online in January 2000, he says, was difficult. “Why a B? Part of my job was to figure out AOL after I became CEO. The merger was driven by my predecessor, but I inherited it. I never figured it out.”

As far as Citigroup goes, he says, he joined its board in 1996, so “I was there when the world hit the wall in 2008, but particularly Citi. So you can’t escape some responsibility for that. I was part of the group that was supposed to be superintending this thing when we hit an iceberg, so that wasn’t so good.” His job “after we hit the fence was just to make sure we got through the crisis and to keep both internally and externally everybody calm while you work on the issues you have to work on to get through a crisis. And I think we were successful at that.”

Parsons has been a major player during tumultuous financial times. He believes we have come through them, and he is optimistic on the future. “The American banking system and financial system is still the anchor for world finance,” he says, adding that American preeminence “has been sustained and remains intact.”

He thinks, though, that “it’s going to be tough for some big banks to regain their footing. But they will. They’ve gotten through the crisis, and now they’ve got to rebuild their business and their credibility, and reshape their business models toward a more stable, less risk-oriented channel. But that’ll be all right.”

That holds equally true for Citigroup, he says. “My prediction is that Citigroup will emerge in the next three to five years as once again probably the preeminent bank in the world, in part because its international franchise is unparalleled. There’s just nobody that has the kind of international scope Citigroup has. And its domestic difficulties—they’ll work their way through that.”

Many people have praised him for his leadership abilities, calling him a listener, a persuader, a diplomat. But others have criticized him for a failure to increase companies’ value, saying he did not possess the visionary qualities necessary for the job. “Yeah,” he says, “I would not call myself a visionary. I think we preserved a lot of value. I was good at leadership and management, but I would not give myself equal marks as a visionary.”

Parsons grew up in a time of racial conflict, but he says he personally has experienced “very little” of “the ugly face of prejudice.” A major exception was when he went down to Virginia to visit his grandparents in the 1950s, when segregation ruled the South, and he encountered examples like separate water fountains and segregated beaches—“My experience with it was almost like a visitor to a foreign land—i.e., Virginia.”

He says he is “criticized by some of my African-American colleagues who say you shouldn’t tell people that you haven’t experienced prejudice or you don’t see it out there, because it’s there and it’s real.” But he has managed, he says, “more by dint of my own personality to get people into a color-blind mode more quickly. I don’t have a sense of victimization. I wasn’t bred that way. I never acquired it. So I don’t look for it. I don’t assume that everything that happens to me that’s shitty is because I’m black. I didn’t get that job, so it must be prejudice. It’s not how I’m geared or built.”

But, he says, “there is an almost bred-in-the-bone in America prejudice that manifests itself almost institutionally.” He cites his time as a lawyer, when he was for a while a hiring partner and recruited African-Americans to diversify his firm. “And one of the things I noticed was that if a kid who is from the middle of the class at Harvard, white kid, would come in and you give an assignment, and half of them would trip over their first assignment, and you’d sit down with them, and it was almost bred in everybody’s expectations, we know you’re a Harvard guy, let’s work with you, you didn’t get this right, and you’d forgive them their first or second less-than-stellar outing.” For “a black kid, not so. So I learned to tell all these young black associates, you really need to nail your first outings, and get help if you want to. Because what would happen is if a black kid turned in something that was not right, you could just see it in people’s faces—there, you knew they couldn’t do it.”


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