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Hard Choices

Hank Greenberg on Battling AIG


I’d run AIG (AIG) for almost 40 years when I was forced to step down as CEO in 2005. We had more than $100 billion in revenue, and I’d devoted most of my life to building this company. At first, I agreed to stay on as nonexecutive chairman. But after I left for a previously scheduled trip to Asia, I realized I couldn’t. I was in the middle of a war with an Attorney General who wanted to be governor and used that office to go after a number of targets, including me. I had a board that no longer supported me. Some of them stood up to Eliot Spitzer, others caved. I got in touch with my lawyer, David Boies, to send a letter announcing my intention to retire.

I hadn’t decided what to do next. I’ve never been interested in retirement. I get three hours of sleep a night, anyway, and I still had other responsibilities. AIG was just one of the businesses I managed when we took it public in 1969. I was chairman of C.V. Starr, which had four specialized insurance agencies. I was also in charge of Starr International, a private company with a stake in AIG that was probably worth about $20 billion. AIG never owned Starr International, though it tried to claim it did after I left. There were directors with selective amnesia who ignored the history. I had to spend seven and a half consecutive days on a witness stand to defend our ownership of that company. We won.

Whatever I felt about AIG didn’t matter anymore. I was still a major shareholder, but I couldn’t control what went on there. My job was to do what was right for the businesses I still led, not for AIG. I had consolidated the agencies and focused on new ways to grow. I offered to keep doing business with AIG, but they severed those ties. That didn’t stop us. A lot of people who’d had responsibilities at both AIG and Starr left on their own to join me. We’ve more than tripled in size since 2005.

It’s very hard for me to think about AIG now. I prefer to look forward. I like building things, and I believe I’m good at it. The size of the organization doesn’t matter: You can’t tell a general by the size of his tent. It’s much more fun running a private company where you have flexibility. If you have to look over your shoulder about everything you do, it affects your business. We’ve just signed a big deal in China, and we’re entering many parts of the world. If you look back in 10 years, this will be a significant organization. — As told to Diane Brady

 


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