Global insurer American International Group (AIG) has announced that Peter S. Zaffino is set to take over the role of Chief Executive Officer (CEO) from Brian Duperreault, who will instead serve as Executive Chairman of the Board until the end of this year.
Duperreault will hold this role through to December 31, 2021, after which he will become a non-officer employee of AIG and provide assistance and advice to Zaffino.
Zaffino, who currently serves as President and Global Chief Operating Officer at AIG, will transition into his CEO position on March 1, 2021.
He will be provided with an annual target direct compensation of $17 million, comprising an annual base salary of $1.5 million, a target 2021 short-term incentive opportunity of $4 million and a 2021 long-term opportunity of $11.5 million.
Duperreault’s agreement, meanwhile, provides for a 2021 annual target direct compensation of $12.75 million, comprising an annual base salary of $1 million, a target 2021 short-term incentive opportunity of $750,000 and a target 2021 long-term opportunity of $11 million in the form of 50% restricted stock units and 50% stock options.
The agreement with Duperreault also provides for 2022 annual target direct compensation for service as a non-officer employee of $7.5 million, comprising an annual base salary of $500,000 and a target 2022 long-term incentive opportunity of $7 million in the form of 50% in restricted stock units and 50% in stock options.
At present, it has been decided that Duperreault’s employment will end on December 31, 2022 unless agreed otherwise with the CEO.
Both letter agreements were approved by the independent members of the Board of Directors AIG, based on the recommendation of the Compensation and Management Resources Committee after advice from F.W. Cook, its independent compensation consultant, and Sullivan & Cromwell LLP, its outside legal counsel.