Skip to main content

What? You Think You're On The Board For Your Looks?

After being bailed out three times (and counting) and reporting the largest quarterly loss in history, AIG now says certain senior executives are legally entitled to $165 million in incentive compensation.

I doubt they're right though, in any case, I'd make 'em sue me to get the money. ( I hear Barney Frank is now on the case; maybe that makes you feel better than it does me.) Regardless, it's time to re-focus away from the actual bonuses, and ask who structured and approved such breathtakingly flawed compensation contracts?

Who legally obligated AIG to pay bonuses EVEN WHILE the company is crashing and burning?

Who memorialized the idea that executives deserve more, more and more, EVEN AS AIG's very existence hinges on continued taxpayer largesse?

Who signed those contracts saying "Yeah, we'll pay bonuses for a range of scenarios UP TO AND INCLUDING AIG reporting the largest quarterly loss in American corporate history?"

Someone on the AIG Board's compensation committee apparently, someone who figured they'd learn to spell "fiduciary duty" on the first tee.

(Thanks to condron.us for the traffic!)


Labels:

Comments

Post a Comment

Popular posts from this blog

Michael Porter On Health Care Reform

Michael Porter, writing in the New England Journal of Medicine, proposes "A Strategy For Health Care Reform - Toward A Value-Based System." His proposals are fundamental, lucid and right-on, meaning they're sure to be opposed by some parties to the debate, the so-called "Yes, but..." crowd. Most important, in my opinion, is this: "... electronic medical records will enable value improvement, but only if they support integrated care and outcome measurement. Simply automating current delivery practices will be a hugely expensive exercise in futility. Among our highest near-term priorities is to finalize and then continuously update health information technology (HIT) standards that include precise data definitions (for diagnoses and treatments, for example), an architecture for aggregating data for each patient over time and across providers, and protocols for seamless communication among systems. "Finally, consumers must become much mor
Post a Comment
Read more

Being Disrupted Ain't Fun. Deal With It.

Articles about disrupting healthcare, particularly those analogizing, say, Tesla's example with healthcare's current state, are frequently met with a chorus of (paraphrasing here) "Irrelevant! Cars are easy, healthcare is hard." You know, patients and doctors as examples of "information asymmetry" and all that. Well, let me ask you this: assuming you drive a car with a traditional internal combustion engine, how much do you know about the metallurgy in your car's engine block? I'll bet the answer is: virtually nothing. In fact it's probably less than you know about your own body's GI tract. Yet somehow, every day, us (allegedly) ignorant people buy and drive cars without help from a cadre of experts. Most of us do so and live happily ever after (at least until the warranty expires. Warranties...another thing healthcare could learn from Tesla.) Now, us free range dummies - impatient with information asymmetry - are storming healthcare
Post a Comment
Read more

My Take On Anthem-Cigna, Big Dumb Companies and the Executives Who Run Them

After last Friday's Appeals Court decision, Anthem's hostile takeover of, er, merger with Cigna has but a faint pulse. Good. Unplug the respirator. Cigna's figured it out but Anthem is like that late-late horror show where the corpse refuses to die. Meanwhile, 150 McKinsey consultants are on standby for post-merger "integration" support. I guess "no deal, no paycheck..." is powerfully motivating to keep the patient alive a while longer. In court, Anthem argued that assembling a $54 billion behemoth is a necessary precondition to sparking all manner of wondrous innovations and delivering $2.4 billion in efficiencies. The basic argument appears to be "We need to double in size to grow a brain. And just imagine all those savings translating directly into lower premiums for employers and consumers."  Stop. Read that paragraph again. Ignore the dubious "lower premiums" argument and focus on the deal's savings. $2.4 billion saved
Post a Comment
Read more