have been on a nonstop climb ever since. At press time, the stock was selling for $58 a share.
Another key factor is Fannie Mae differs from almost all other U.S. corporations in that it doesn’t actually produce any consumer products. And with the exception of its Washington-chartered rival, Freddie Mac, Fannie Mae has no direct competitors. In many ways Raines’ appointment is similar to that of Cliff Wharton, former head of the world’s largest private pension fund, TIAA-CREF (No. 30 on the Fortune 500 with $29.4 billion in revenue) until he retired in 1994.
Despite the distinct nature of Fannie Mae, many still perceive Raines’ selection as a unique breakthrough. “I consider Frank Raines the Jackie Robinson of corporate America,” says National Urban League President Hugh Price. “Fannie Mae’s roots may be in the public sector, but it has been spawned into the private sector.”
W. Frank Fountain, president of the Executive Leadership Foundation in Washington, D.C., an organization composed of many top black executives in Fortune 500 firms, agrees. The quasi-governmental nature of Fannie Mae, he says, shouldn’t detract from its significance. “Fannie Mae is publicly held by shareholders who are just as demanding for a return on their equity as any shareholder,” says Fountain, who’s also vice president of governmental affairs for Chrysler. “We should all be proud to see Raines not only become the CEO of a Fortune 500 firm, but of a firm that is critical to prospective African American home buyers.”
Raines’ mandate at Fannie Mae is dear. He’ll have to continue the record-breaking growth of the company’s earnings while staving off foes who’d like to see Fannie Mac stripped of its congressional privileges. If nothing else, Raines’ appointment signifies yet another critical step as African Americans continue their quest up the ladder. While the impact of his appointment on other prospective black CEOs can’t be determined yet, the high profile and stature of the position could very well speed up what has long been a slow climb for blacks in corporate America.
TAKING THE HELM
Franklin Raines has successfully hopscotched between corporate and political worlds for over 20 years. Earning a B.A. in government in 1971 from Harvard, he was selected as a Rhodes Scholar at Oxford University in England shortly after. In 1976, he received a law degree from Harvard Law School and the following year landed a coveted position as an assistant director of the White House Domestic Policy Staff during the Carter administration. After working on social issues such as welfare reform, food stamps and social security, he moved to OMB.
Following Carter’s defeat in 1980, Raines jumped to the corporate arena and took a job with Lazard Freres & Co., a New York investment bank. There he quickly rose to general partner in the municipal finance division. But in 1991, he traded in his Wall Street post and a life that kept him away from his family most of the week for a lob at Fannie Mac back in Washington, D.C. He spent five years