Greenberg’s View

From 1967 until March 2005, Maurice “Hank” Greenberg, now chairman and CEO of Starr Cos., helped build American International Group (AIG) into the world’s largest insurer with a market value of $180 billion, forging relationships, opening markets and inventing products around the globe. All was well until 2005, when New York Attorney General Eliot Spitzer set his sights on Greenberg, forced him out as CEO of AIG early and nearly destroyed the company. In a new video interview with Wells Media Group’s Andrew Simpson, Greenberg shares stories from his new book “The AIG Story,” including his views on AIG, Spitzer, the financial crisis that led to the government owning 79 percent of AIG and the principles that have guided him during his 60-year insurance career.

The following are excerpts on just a few of the topics from that interview. Watch the complete interview and all excerpts at www.InsuranceJournal.tv.

Corporate Culture

How much of AIG’s culture was your personality and values versus something that you had to create?

Greenberg: It’s hard to separate the two, I think. The mark of a good executive is one who doesn’t try to be like everybody else, tries to be himself, number one, and himself is different from most others. You don’t just try to follow in somebody else’s footsteps to be like them. You want to be yourself and yourself has got to be different than most others. You’ve got to think independently. If you don’t think independently, what are you? You’re just a copycat.

Foreign Trade

What is your view of attaching human rights, environmental or other conditions to global trade agreements?

Greenberg: I think you have to be careful about that. If we started to … and that’s one reason why we have such few trade agreements … You can’t tell a country what to do in their country. If they want to not follow union practices, that’s up to them. It’s their country. We can’t negotiate an agreement and tell them what to do in their backyard. It’s their country, not ours. If you’re there and you treat your employees differently and you meet with leaders of that country and explain why it’s in their national interest over a period of time to adopt certain practices. You don’t win all the time, but you win many times. It’s that kind of a dialog, that’s important. That’s why American business operating globally has an influence on the behavior of many countries.

Employee Compensation

Why do you think long-term compensation is best?

Greenberg: We wanted people to have a long-term view, commitment to what we were doing, not for everybody. We didn’t want everybody. We wanted the people who shared the same values that we did. I never had an employment contract. I refused it. I had a plan. I would never take compensation of more than a million dollars. You can pay me a bonus, but I don’t want, and the bonus has to be based on certain performance issues. I participated in, what we call the SICO plan, which was not any cost to AIG whatsoever. A private company that we did out of our own pocket when we went public. We compensated many individuals in AIG based on performance. That’s what I thought it ought to be.

Climate Change

Is climate change something you factor into strategy?

Greenberg: There’s climate change taking place but how much of it is man-made and how much of it is plain nature? We had an ice age on this planet a million or hundreds of years ago. Is what we’re seeing a part of a new change in climate? Is man-made change that traumatic or is it a pitiful small amount of it? There’s nobody to give you a straight answer on that. Currently, whether it’s man-made or nature-made, there is a change going on. You have to deal with it, not because the change is going to take place over 100 years, it’s happening now.

Topics AIG