After uttering a string of incendiary remarks, the new CEO of American International Group Inc. may face harsh words from board members concerned that his tough talk has gone too far.
Certain members of AIG's board, which put Robert Benmosche into the chief executive's role in August, have been taken aback by his comments at employee meetings, say people familiar with the matter. Mr. Benmosche said New York Attorney General Andrew Cuomo "doesn't deserve to be in government" and that Mr. Benmosche would leave dealing with "all those crazies down in Washington" to the company's chairman, according to an account by Bloomberg News that was confirmed by Mr. Benmosche.
AIG is in a tough position -- at once having to mollify Congress and regulators, motivate employees and make overtures to the company's remaining public shareholders. It is one of the reasons why the AIG board split the roles of chairman and CEO, with the CEO focusing on company business and the chairman focused on Washington relations.
Some board members are unfazed by Mr. Benmosche's style, according to people familiar with the matter. Many employees, along with people outside the company, are refreshed by Mr. Benmosche's brashness, and his articulation of the view that executives -- not regulators -- should run businesses.
Still, AIG has tens of thousands of employees in businesses around the world, and good feelings aren't universal. That may be particularly true for employees in foreign units who hoped to earn back some personal wealth via planned initial public offerings of stock in certain subsidiaries. Those plans have been put on review.
Some AIG board members intend to discuss how to better manage Mr. Benmosche when independent directors convene privately during a board retreat in mid-September, according to people familiar with the matter.
Golub Intervention?
They may tell him that a change in tone is essential. The board "could go so far as to say, 'It's a condition of your continued employment,'" one person said. At the least, there could be "a little adult counseling" from Chairman Harvey Golub, another person suggested. Mr. Golub, who along with Mr. Benmosche assumed his post Aug. 10, declined to comment Wednesday about that possible scenario.
Mr. Benmosche, for one, seems prepared for any rebuke. "It would be appropriate if they said it," said Mr. Benmosche, 65 years old, in an interview Wednesday. "But the board doesn't have to tell me that. I've already told it to myself."
He said he and Mr. Golub have discussed the flap over the Cuomo remarks. Mr. Golub said earlier this week that the comments weren't made "in a thoughtful way."
Mr. Benmosche, the former head of MetLife Inc., exhibited swagger even during the hiring process. He refused to give up his planned multiweek late-summer stay in Croatia, for instance. "It wasn't a fight [directors] were going to pick" because they wanted "to get the guy across the finish line," recalled a person familiar with the situation,
Reference checks suggested Mr. Benmosche "was an outspoken guy," but he's amped up his manner, this person added.
Washington appears to be giving Mr. Benmosche some leeway. The Treasury and the Federal Reserve Bank of New York, which have committed tens of billions in aid to AIG, have declined to comment on Mr. Benmosche's remarks.
Another issue that has caught employees' attention: Mr. Benmosche's frequent use of four-letter curses during meetings. He concedes he "sometimes" curses and said it is "inappropriate."
'I Was Too Aggressive'
Mr. Benmosche said the aggressive tone is meant to comfort his employees, who were demoralized by their company's near collapse, as well as political attacks from Congress and state officials.
"I was too aggressive," in remarks concerning Mr. Cuomo, he said, adding that the comments were made in response to an employee question. "The fear that these people were expressing to me is such that they wanted to know that I will stand up for them if they are ever attacked again and their families are put in harm's way."
He was referring to a controversy earlier this year in which lawmakers and taxpayers spun into a rage on word that employees of an AIG unit largely responsible for bringing down the company were receiving millions in previously agreed-upon bonuses. Mr. Cuomo pushed for recipients to return the funds and considered revealing names of those who didn't, though ultimately he didn't reveal names.
Only months ago, countless regulators and members of Congress expected to have a say in AIG's every move, and Mr. Benmosche's predecessor, Edward Liddy, was respectful and accommodating, making pilgrimages to Washington and saying "everything we do we do in partnership with the Federal Reserve."
On Tuesday, Rep. Elijah Cummings (D., Md.), one of AIG's most vocal critics in Congress, in an interview called Mr. Benmosche's critical comments "most unfortunate" and said "he owes the Congress an apology." Mr. Benmosche declined to comment.
Mr. Cummings said most members of Congress have been giving Mr. Benmosche "the benefit of the doubt." He added: "I really want to see AIG succeed."
Certain members of AIG's board, which put Robert Benmosche into the chief executive's role in August, have been taken aback by his comments at employee meetings, say people familiar with the matter. Mr. Benmosche said New York Attorney General Andrew Cuomo "doesn't deserve to be in government" and that Mr. Benmosche would leave dealing with "all those crazies down in Washington" to the company's chairman, according to an account by Bloomberg News that was confirmed by Mr. Benmosche.
AIG is in a tough position -- at once having to mollify Congress and regulators, motivate employees and make overtures to the company's remaining public shareholders. It is one of the reasons why the AIG board split the roles of chairman and CEO, with the CEO focusing on company business and the chairman focused on Washington relations.
Some board members are unfazed by Mr. Benmosche's style, according to people familiar with the matter. Many employees, along with people outside the company, are refreshed by Mr. Benmosche's brashness, and his articulation of the view that executives -- not regulators -- should run businesses.
Still, AIG has tens of thousands of employees in businesses around the world, and good feelings aren't universal. That may be particularly true for employees in foreign units who hoped to earn back some personal wealth via planned initial public offerings of stock in certain subsidiaries. Those plans have been put on review.
Some AIG board members intend to discuss how to better manage Mr. Benmosche when independent directors convene privately during a board retreat in mid-September, according to people familiar with the matter.
Golub Intervention?
They may tell him that a change in tone is essential. The board "could go so far as to say, 'It's a condition of your continued employment,'" one person said. At the least, there could be "a little adult counseling" from Chairman Harvey Golub, another person suggested. Mr. Golub, who along with Mr. Benmosche assumed his post Aug. 10, declined to comment Wednesday about that possible scenario.
Mr. Benmosche, for one, seems prepared for any rebuke. "It would be appropriate if they said it," said Mr. Benmosche, 65 years old, in an interview Wednesday. "But the board doesn't have to tell me that. I've already told it to myself."
He said he and Mr. Golub have discussed the flap over the Cuomo remarks. Mr. Golub said earlier this week that the comments weren't made "in a thoughtful way."
Mr. Benmosche, the former head of MetLife Inc., exhibited swagger even during the hiring process. He refused to give up his planned multiweek late-summer stay in Croatia, for instance. "It wasn't a fight [directors] were going to pick" because they wanted "to get the guy across the finish line," recalled a person familiar with the situation,
Reference checks suggested Mr. Benmosche "was an outspoken guy," but he's amped up his manner, this person added.
Washington appears to be giving Mr. Benmosche some leeway. The Treasury and the Federal Reserve Bank of New York, which have committed tens of billions in aid to AIG, have declined to comment on Mr. Benmosche's remarks.
Another issue that has caught employees' attention: Mr. Benmosche's frequent use of four-letter curses during meetings. He concedes he "sometimes" curses and said it is "inappropriate."
'I Was Too Aggressive'
Mr. Benmosche said the aggressive tone is meant to comfort his employees, who were demoralized by their company's near collapse, as well as political attacks from Congress and state officials.
"I was too aggressive," in remarks concerning Mr. Cuomo, he said, adding that the comments were made in response to an employee question. "The fear that these people were expressing to me is such that they wanted to know that I will stand up for them if they are ever attacked again and their families are put in harm's way."
He was referring to a controversy earlier this year in which lawmakers and taxpayers spun into a rage on word that employees of an AIG unit largely responsible for bringing down the company were receiving millions in previously agreed-upon bonuses. Mr. Cuomo pushed for recipients to return the funds and considered revealing names of those who didn't, though ultimately he didn't reveal names.
Only months ago, countless regulators and members of Congress expected to have a say in AIG's every move, and Mr. Benmosche's predecessor, Edward Liddy, was respectful and accommodating, making pilgrimages to Washington and saying "everything we do we do in partnership with the Federal Reserve."
On Tuesday, Rep. Elijah Cummings (D., Md.), one of AIG's most vocal critics in Congress, in an interview called Mr. Benmosche's critical comments "most unfortunate" and said "he owes the Congress an apology." Mr. Benmosche declined to comment.
Mr. Cummings said most members of Congress have been giving Mr. Benmosche "the benefit of the doubt." He added: "I really want to see AIG succeed."
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