Photo: Dado Ruvic/Reuters
The revelation of massive layoffs at insurance behemoth AIG last year, which included the departure of many staff, has taken an interesting turn in an unexpected turn of events. Putman, a former employee of AIG, clarifies the company's approach while implying that decisions like these are influenced by appearances. But what really gets people talking is that, as of 2022, AIG's CEO, Peter Zaffino, earned an astounding $75 million in compensation—the majority of which came from stock grants—making him the highest-paid CEO in the casualty and property insurance industry.
Behind the Scenes: Layoffs and Executive Compensation
Putman proposes a link between reducing headcount and positive board reporting, given that hundreds of employees suffered layoffs. The story reveals a convoluted situation in which business decision-making, notwithstanding employee reductions, appears to be driven mostly by financial appearances.
Zaffino's Ascension: A Noteworthy Feat
Zaffino's financial rise is clearly seen in the data produced by Equilar, which places him as the third-highest-paid CEO in corporate America based on revenue. AIG's decision to not publicly commit to reducing CEO pay following layoffs raises concerns about the company's policy of putting its leaders' financial security first.
Corporate Silence: AIG's Response (or Lack Thereof)
AIG has reached out for comment, but in light of the ongoing personnel downsizing, it has not disclosed the salaries of its leaders. Transparency and accountability are evidently at the top of shareholders' concerns as the public eagerly anticipates AIG's upcoming proxy statement, which is essential for revealing CEO remuneration.
Industry-Wide Inquiry: Mixed Responses from Corporate Giants
While AIG remains silent, reactions to Al Jazeera's inquiry from other large firms were inconsistent. Some companies have not yet revealed information about executive salary, including GoDaddy, Ford, Morgan Stanley, Pfizer, and T-Mobile. As these corporations get ready to reveal the details in the upcoming months, there's a sense of expectancy in the air.
AIG's story adds a level of complexity to the current discussion over executive compensation and corporate accountability as the business sector strikes a careful balance between corporate performance and employee well-being. A transparent proxy statement that gives stakeholders a better view at the financial factors influencing the corporate environment in 2024 is about to take place. As the story develops, keep checking back for updates.
