Gerry Pasciucco was made to lead American International Group's Financial Products (AIGFP) group after the government bailout of AIG in 2008 and charged with the task of shutting down the division while minimizing the government's losses. AIGFP's unsuccessful trades had threatened to bring down the entire firm, as well as the government had responded by loaning AIG $182 billion in exchange for 79.9% of the firm, since it was apprehensive that AIG’s failure will trigger the collapse of the whole global financial system.
Several months into his tenure, the division paid large retention bonuses to all its own professionals according to a contract before he joined AIGFP negotiation. These additional benefits were perceived by the community as going to the very people whose errors resulted in the demand for a bailout in the very first place and consequentially led to an extraordinary storm of public fury, concluding in a Congressional hearing in which AIG's CEO, Ed Liddy, was constantly attacked for making the bonus payments. Liddy reacted by requesting individuals who had received the greatest payments to return the money to the business. Pasciucco has to decide the way to lead his team by means of this catastrophe while grappling with the bigger issues of the justice of the retention payments.
PUBLICATION DATE: November 14, 2012 PRODUCT #: 413059-HCB-ENG
This is just an excerpt. This case is about LEADERSHIP & MANAGING PEOPLE
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