Hooray for Willumstad

Yesterday, the Wall Street Journal on-line edition reported that Robert Willumstad, the ousted CEO at AIG, has said he will forgo the $22 million severance payment owed to him by AIG under the terms of his contract. Here is the clipping from the WSJ article:

Meanwhile, departed Chief Executive Robert Willumstad, who was replaced in Treasury's rescue of the insurance giant, told the company Sunday that he won't accept his severance payment of $22 million, according to a person familiar with Mr. Willumstad's decision....

Late last week, AIG's board decided that Mr. Willumstad's termination was "not for cause" and that it would fulfill its contractual several obligation of a $22 million payment.

But Mr. Willumstad wrote in a weekend email to his successor, Edward Liddy, that he would "forgo the severance." He said that he wasn't able to "execute the restructuring" plan he developed in his three-month tenure as CEO because of circumstances that predated his term, as well as the capital-markets upheaval. Also, he added, "I prefer not to receive severance while shareholders and employees have lost considerable value in their AIG shares."

The severance had been negotiated to lure Mr. Willumstad to AIG three months ago. He gave up as much as $50 million to leave a private-equity firm he headed. (http://online.wsj.com/article/SB122204202797461249.html)

I say, "Hooray for Mr. Willumstad."

I have no comment on his ability as CEO (he was only at AIG for three months), but I wish we had more leaders in corporate America demonstrating Mr. Willumstad's kind of ethical character.