Expert Perspective from Grahall’s OmniMedia Editorial Board
Two articles this week addressed the comments made by AIG’s CEO, Robert Benmosche, as a result of limitations imposed by Kenneth Fienberg, The Obama Administration’s “Pay Czar”. First on November 11, 2009 Wall Street Journal reporters Liam Pleven, Serena Ng and Joann S. Lublin tell us that “At a board meeting last week, the strong-willed industry executive told fellow AIG directors that he was “done” but agreed to think it over after other board members reacted with shock, according to the people.” (AIG’s Benmosche Threatens to Jump Ship Chafing Under Government Oversight, Chief Executive Tells Board He’s ‘Done’; ‘An Impossible Situation’).
Reaction: Cry baby!
Continue reading “He’s ‘Done’ It” »
Published in National Underwriter October 14, 2009 by Daniel Hays
Treasury officials could have avoided the explosive controversy over American International Group bonuses if they had carefully examined the company’s compensation system, government investigators reported.
Published in Business Insurance October 6,2009 by Judy Greenwald
U.S. pay “czar” Kenneth R. Feinberg has approved American International Group Inc. President and Chief Executive Officer Robert H. Benmosche’s annual pay package of $10.5 million.
Link to full article
Published in Bloomberg September 17, 2009 by Hugh Son and Christine Harper
American International Group Inc. Chief Executive Officer Robert Benmosche was rebuffed by the insurer’s board after saying he should be allowed personal use of the bailed-out company’s aircraft, according to two people familiar with the matter.
Link to full article.
Expert Perspective by Grahall’s OmniMedia Editorial Board
The August 20, 2009 article by Reuter’s journalist Lilla Zill (“AIG chief’s salary structured to reflect risk“) says “AIG, the bailed out insurer whose pay practices sparked outrage earlier this year … said it will pay Benmosche, who became CEO on August 10, a salary of $3 million in cash and $4 million in fully vested stock. He also could receive a bonus valued as high as $3.5 million.”
We wonder what the message is when the government’s pay czar approves such a package.
Continue reading “Looking for CEO’s in All the Wrong Places” »
Published in Reuters August 20, 2009 by Lilla Zuill
AIG, the bailed out insurer whose pay practices sparked outrage earlier this year, has agreed to a $10.5 million pay package for its new CEO — a stark contrast to his predecessor’s $1 pay but drawing zero outcry from politicians or regulators.
Link to full article.
Expert Perspective by Grahall’s Garry Rogers
In an April 4, 2009 article in the New York Times, “Big Bonuses at Fannie and Freddie Draw Fire”, Times journalist Charles Duhigg reports that
“…the two troubled companies at the heart of the nation’s mortgage market, are set to pay [7,600] employees “retention bonuses” totaling $210 million, despite [criticism and] calls from [some] lawmakers to cancel the payments.’ Duhigg further states, “Similar bonuses paid by the American International Group, which was also bailed out by taxpayers, incited fiery attacks from the White House and legislators when they were revealed last month.”
So are these situations, one with Freddie and Fannie and the other with AIG, the same or different? Should we permit taxpayer dollars to be used for bonus payments for any of the “bailed out” companies? Should government stay out of it, and leave the business decisions to business leaders?
The answers may surprise you,
Continue reading “Freddie, Fannie and AIG – It’s Just Not So Simple” »
Published in International Business Times, April 9, 2009 by Robert Solomon.
The issue of executive pay has resurfaced again in the wake of questionable AIG bonuses, and exorbitant compensation packages for banking executives. Pundits see the problem largely as a consequence of a lack of independence among boards of directors.
Published in the New York Times on April 4, 2009 by Charles Duhigg
Fannie Mae and Freddie Mac, the two troubled companies at the heart of the nation’s mortgage market, are set to pay their employees ‘retention bonuses’ totaling $210 million, despite calls from lawmakers to cancel the payment.
The bonuses, which were made public on Friday, were defended by the companies’ federal regulator, James B. Lockhart, who said he intended to let them proceed.
Link to full article
Expert Perspective by Grahall’s RObert Cirkeil
In a March 17, 2009 article in New York Times Times editor Andrew Ross Sorkin asks “Do we really have to foot the bill for those bonuses at AIG?” He supports the proposition on two fronts:
- It’s contractual and business would be worse off if the government “would start abrogating contracts left and right”; and
- that these bonuses retain folks who can a) fix the mess and b) if not incented to stay, “quite possibly, be put it to work at a competing firm against taxpayers’ interests.”
Continue reading “Changing Landscape for Executive Bonuses” »