American International Group Inc`s new Chief Executive Brian Duperreault has pledged to revive the insurer`s glory days of top talent, underwriting discipline and fat profit margins.
One thing he has already brought back: big pay packages.
As he rejoined AIG in May, the 70-year-old insurance industry veteran received bigger awards than any of his predecessors since Maurice "Hank" Greenberg, the man who built the company into a behemoth and left under a cloud in 2005.
Duperreault quickly hired as his deputy Peter Zaffino, a former colleague at broker Marsh & McLennan Cos Inc, with a lucrative sign-on bonus, as well as a senior executive to head technology initiatives.
Shareholders are banking that these costly personnel moves will pay off, after watching AIG stock underperform rivals and the broader market for nearly a decade.
"He (Duperreault) comes with a visible long-term track record in terms of inspiring the operations and leading the personnel," said Mac Sykes, an analyst at investment firm Gabelli & Co, which owned about $58 million worth of AIG shares as of June 30. "It`s what AIG needs at this point."
Sykes and others said they have no issue with Duperreault`s handsome pay package, as long as he performs.
"We didn`t react in a negative way, especially because they`re going to make a lot more money if they execute," said a portfolio manager whose fund owns a large AIG stake, but was not authorized to speak about it publicly.
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