AIG's Newest CEO Getting Praise

IG’s latest selection of Robert Benmosche, the former CEO of MetLife, is getting a fair amount of praise before he begins his new job and comes out of retirement. Benmosche gets high praise in a story by Leslie Scism, Joanne S. Lublin and Liam Plevin of the Wall Street Journal (sub req.). The reporters stated:

He will also be the most decisive, direct and tough leader to run the battered insurer since Maurice R. “Hank” Greenberg’s nearly four-decade reign ended amid an accounting scandal in 2005.

Mr. Benmosche, former colleagues say, is willing to upend cozy corporate traditions and make unpopular decisions. His strong personality could be just what AIG and its majority owner, the U.S. government, need to manage the company.

AIG’s subsequent selection of Harvey Golub, the former CEO of American Express, as the company’s new chairman appears to be another feather in the company’s cap. Whether it is the government or the company making the executive selections it appears AIG is at least making some positive moves.

For more:

Insurance Networking News

NY Magazine

Reuters

What Private Equity Looks For When Hiring A CEO

Check out Tennille Tracy's post on today's WSJ's Deal Journal. Tracy gets advice from a private equity player on what they look for when hiring a CEO. The piece was developed in light of Stanley O'Neal's resignation as CEO of Merrill and the fact that Merrill made Alberto Cribiore, a private equity veteran, Merrill's acting CEO. Criobiore is expected to play a key role in the CEO search and hiring process. Check it out.

For more:

Business Week Management IQ
New York Times

Food For Thought On Long Serving CEOs

According to a September 26 piece by Dennis Berman on The Wall Street Journal's Deal Journal,

the fifth year of a CEO’s tenure is his most tumultuous, and the one where he is most likely to do a deal, according to a fresh study of CEO behavior conducted by two Harvard Law School professors.

The professors John C. Coates IV and Reinier Kraakman crunched numbers on CEO tenure at S&P 500 companies from 1992 through 2004, representing a total of 6,449 analyzed years. They found that during the first four years of a CEO’s stay, the turnover is very low.

Once the fifth year hits, all kinds of weird things start to happen. The number of mergers at such companies surges nearly four-fold in that fifth year. Retirements accelerate as well.

For more on the study check out the professors' report. If you want to perform your own analysis you might consider checking out Liberum's Management Change Database which is far more comprehensive than the data used by the two Harvard Professors.