April 2 (Reuters) - Insurer American International Group Inc said on Tuesday it paid Chief Executive Officer Brian Duperreault $20.9 million in 2018 while also outlining a series of reforms to its pay practices in the face of shareholder criticism.
The pay, for Duperreault's first full year at the helm of the insurer, was less than half the $43.1 million he received in 2017, which included a $12 million cash bonus and other one-time awards.
At its annual meeting in 2018, only 62 percent of shareholder votes backed the pay, an unusually low number compared with the roughly 95 percent support that major U.S. companies typically receive in such votes. So-called say-on-pay votes are nonbinding but low results often spur directors into action to guard against losing their own seats.
AIG now hopes to win over some of the skeptical investors at this year’s annual meeting, set for May 21 in New York. Potentially making the task harder will be that shares of the company declined 34 percent in 2018.
Duperreault, known in the insurance industry as a turnaround expert, took charge of AIG in May 2017.
In its proxy, filed on Tuesday, AIG listed a number of steps it has taken in response to shareholder concerns, including tying executive pay more directly to share performance.
For instance, the company said that although Duperreault could have achieved a short-term incentive award of $3.456 million, the board reduced that to $3.04 million in order to reflect “shared accountability” for overall company performance.
Other changes include an initiative to increase diversity among board members and ensuring that board member nominees who are also chief executive officers and up for election this year serve on only one outside board. (Reporting by Suzanne Barlyn in New York and Ross Kerber in Boston Editing by Matthew Lewis)