Craig Donohue '95

Alumni Profile: Craig Donohue '95

Bright futures
With Craig Donohue '95 at its helm, the Chicago Mercantile Exchange forecasts continued innovation in its structure and technology

By Deborah Leigh Wood

Craig Donohue '95, CEO of the Chicago Mercantile Exchange, says his Kellogg School classmates viewed him as someone who “couldn’t tune out the office, and was mentally at work 23 hours a day.”

“They probably wondered how enriched I was getting, but I soaked up a lot and learned a tremendous amount,” Donohue says in something of an understatement, given his career. Since he arrived at the CME as a staff attorney in 1989, Donohue has been on a fast track: vice president of market regulation in 1997, senior vice president and general counsel in 2000, managing director of business development in 2001 and chief administrative officer in 2002 until assuming his current title. He credits Kellogg with preparing him for heading what is now, thanks in part to his leadership, the largest futures exchange in the United States and the first publicly traded financial exchange in the United States.

“My job is both exhilarating and taxing,” he says. “I probably could never work anywhere else. We have extraordinary people and concepts, and great intellectual exploration. The environment is ideal for cultivating ideas, creativity and innovation.”

Donohue is credited with employing all three in helping facilitate headline-making changes. With cutting-edge technology now in place, the CME offers what he terms a “vastly different approach” of trading futures and options-on-futures electronically on the exchange’s CME Globex trading platform. Donohue says it lowers costs for market users and has added value for the CME. In the first quarter of this year, 52 percent of trades at the CME were transacted electronically; in the third quarter that figure rose to 62 percent.

As the CME continues to expand the distribution of its products electronically, it is seeing the results in terms of increased volume and liquidity. Donohue notes that “the growth of electronic trading of CME Eurodollar futures is one of the futures industry’s success stories in 2004. We have progressed from trading 100,000 contracts a day in January to one million a day in September.” The CME recently announced that the CME Globex system traded its billionth futures and options-on-futures contract since its launch in 1992.

Perhaps Donohue’s most significant achievement is helping to consolidate the Chicago Board of Trade’s transaction processing operations into those at the CME. “This is an historic achievement,” he says. “The CME now has the largest clearing organization in the world for derivatives instruments, and this is providing tremendous value for our customers and shareholders.”

Donohue says one of his responsibilities as CEO is to facilitate creativity and innovation in all facets of the organization and to create a culture where others feel comfortable expressing new ideas.

“It’s important to emphasize constant and incremental improvement,” he says. Doing so sets the organizational tone of always striving to build on achievements and never being satisfied with the status quo.

“I don’t believe in going into maintenance mode,” says Donohue. “In today’s competitive business climate, that doesn’t work well.”

As a result, he typically works 12-hour days with responsibilities that include talking to regulatory officials and civic and charitable organizations, and focusing on shareholders, investors and the public. International travel frequently keeps him away from his home in the northern Illinois suburbs, where he lives with his wife Elsa '92 and their three children, ages 5, 10 and 14.

Donohue says he spends whatever spare time he has with his family, putting aside favorite activities such as tennis and golf. But the rest of the time, he is unapologetically tuned in to the office, in his mission to “radically transform one of America’s fastest-growing organizations into a global, diversified financial services company.”