"In Nov. 2008, AIG’s Liddy claimed top execs would forego pay raises and ’2009 bonuses will be restricted.’"
In November 2008, AIG succumbed to public pressure and announced that it would limit executive compensation. CEO Edward Liddy announced he would take a $1 salary, while his top 50 executive would “forgo pay raises through 2009.” In a letter to New York Attorney General Andrew Cuomo, Liddy made the following pledge:
AIG is mindful that it must act prudently and, as such, must impose curbs on executive compensation. … To meet these objectives, AIG’s top seven executives (Leadership Group) will receive no annual bonuses for 2008. In addition, the top roughly 60 executives (Senior Partners) including the seven most senior AIG executives, will forego any salary increase through 2009 and their 2008 and 2009 bonuses will be restricted. [...]
Finally, AIG is developing a funding structure to ensure that no taxpayer dollars are used for annual bonus or future cash performance awards for the top 60 members of management.
Read the full letter here.
Among those who received 2009 bonuses were James Haas (an executive VP), Douglas Poling (a general counsel, executive VP, and chief administrative officer), and Jonathan Liebergall (a director and head of municipal finance). It’s unclear whether they ranked among the top 60 executives at the company.
In his Washington Post op-ed, Liddy doesn’t address his previous statements. But he writes, “In all, total 2008 compensation for the top 47 executives is 56 percent lower than their total 2007 compensation. My annual salary is $1. … To prevent undue risk exposure in the meantime, AIG has made a set of retention payments to employees based on a compensation system that prior management put in place.”