Posted by: ateedub | March 17, 2009

So What Should AIG Do Now?

As I drove home tonight, I was listening to C-SPAN radio’s replay of the House Democratic Press Conference from earlier today in which a series of Congresspeople lambasted AIG executives for their idiocy in giving bonuses. They demanded apologies, they demanded the money be returned, and they demanded that Congress do something about it.

This seems to be pretty basic crisis communications. Apologize, give it back, and ask someone to do something about the problem. But if this is what Congress is asking for (or rather, the Democratic members of Congress are asking for), how should AIG respond to restore its reputation and the public’s trust?

I approach this purely as a communications and reputation-management problem, so please understand that I am setting aside any operational concerns at this moment. Here are the standard crisis comm reactions:

  1. Anyone who was in the approval chain to distribute the bonuses needs to resign.
  2. The CEO, CFO, COO, and all other senior management need to take $100,000 or less salaries until the company is no longer dependent on government money.
  3. The $165 million paid in bonuses should be returned to the government bailout fund (understanding that the money can’t be taken back from the individuals who received it, but the company should take that hit to its balance sheets).
  4. AIG should work on pitching the positive outcomes of the bailout funds – how many blue collar jobs were saved.
  5. Find someone – anyone – who can speak on your behalf. (Except the employees who received the bonuses.)

And all of these things might have worked 5 months ago, or even a week ago. But the story is too widespread, has been picked up by far too many news outlets, and is certainly outside of the controllable range.

But I have to say that AIG is doing an excellent job of making the case for bank nationalization for the administration and/or Congress…convenient.

Update (3/18): Will DiNovi has an interesting piece on the public outcry over on The Atlantic’s opinion pages. It seems I’m not the only one who sees the opportunity in this latest crisis within a crisis…

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