Robert Benmosche, AIG’s CEO, isn’t the only one threatening to leave the firm.Turns out that five top AIG executives have threatened to leave as well.
Somehow being underpaid vs. what they could get elsewhere, and over-hated, isn’t a good deal to them.
WSJ: Five high-ranking executives at American International Group Inc. said last week they were prepared to quit if their compensation is cut significantly by the insurer’s government overseers, according to people familiar with the matter.
The five senior AIG executives indicated on Dec. 1, in written notices, that they’re prepared to leave by year-end, say the people familiar with the matter. They are trying to preserve their ability to collect severance payments, these people say.
Ms. Kelly, AIG’s general counsel, has been at the insurer since 2006 and was appointed vice chairman in January under former CEO Edward Liddy. Several people familiar with the matter say Ms. Kelly asked other employees to join her in indicating they were prepared to resign. Four executives agreed, and Ms. Kelly retained outside counsel to advise the group on their legal options, says one person familiar with what happened.
All of the five executives manage huge responsibilities AIG, such as the international property and casualty business and the U.S. property and casualty business.
Whatever one ‘feels’ they should be paid, when an entire market is willing to offer them a much higher rate, you need to be practical and realistic. Getting the right people is important to shareholder value, and to do so you need to pay the market rate for talent. You can’t let your ‘feel’ for proper pay trump massive evidence in the market of what the actual level is. Luckily two of the execs may have agreed to stay already, read the full WSJ article here.
The author owns shares in AIG.