The first thing you might notice about Jeffrey Greenberg is how modest and self-effacing he can be, particularly for a man who’s held a couple of the most important jobs in the insurance industry. “Jeff was very clever in his way, playful,” says Mark Reagan, a fellow insurance executive who once worked for Greenberg. “You’d walk out of a tough meeting, and Jeff might say, ‘That wasn’t as much fun as I hoped.’ ” As a young man, Greenberg was the type who, despite his family’s wealth, insisted on pumping gas and scrubbing boats to pay off a new car. Even when he went on to earn $22 million last year, Greenberg lived with his second wife and four kids in a relatively unassuming apartment on Park Avenue. Before he became CEO of Marsh & McLennan, a job he held for five years before being forced to resign late last month, Greenberg had a reputation for stepping in to claim responsibility when higher-ups lashed out at his subordinates. There is something almost cartoonishly all-American about him. At six feet tall, Greenberg has the build of a natural athlete. He was, in fact, a standout sprinter, football player, and skier at Choate. As of last month, the 53-year-old Greenberg remained one of the tougher tennis matchups on the executive circuit.
Greenberg is also a textbook incarnation of corporate establishmentarianism. He is a trustee at Brown, his alma mater; at Brookings, the granddaddy of Washington think tanks; and at New York’s elite Spence School, which his eldest daughter attended. Greenberg would be perfectly at home in the halls of the Council on Foreign Relations or at a meeting of the Trilateral Commission. (He’s a member of both institutions.) His family spends weekends at their house in northern Connecticut.
But for all Jeff Greenberg’s obvious successes, he’d never escaped the shadow of his larger-than-life family. His father, Maurice R. “Hank” Greenberg, the CEO and chairman of AIG, is quite possibly the most famous man in the history of the insurance business. Hank almost single-handedly built the company into a global financial-services powerhouse over the past 37 years. At least since adolescence, Jeff has been dogged by the sense that nothing he could accomplish would amount to more than a footnote alongside the achievements of his father.
For his part, Hank, whose management style former employees have compared to George Patton’s, did his best to remind Jeff of this fact during the seventeen-year period he worked for his father at AIG. “Do I think he was harsher because [Jeff] was his son? I think the answer is yes,” says one former AIG executive. In one notorious incident, Hank blew up at Jeff over a personnel problem in a roomful of colleagues. “You either fix your management problem or I’ll fix mine!” the father reportedly bellowed. “I think it was a case of two people from the same gene pool with extraordinarily high success drives,” says this executive. “And there’s only so much oxygen in any given room.”
Jeff Greenberg’s white-collar sensibility didn’t mean he refused to play hardball like his father, Hank, or his brother Evan. It’s just that Jeff wasn’t as good at it.
To further complicate the matter, Jeff was not the only Greenberg son high up in the AIG hierarchy. Toward the end of Jeff’s time at AIG, his younger brother Evan was head of the company’s international operations—and probably the only person who’d risen faster at AIG than Jeff. The brothers had been lifelong rivals. Jeff had always been the good son—successful at school, successful at work, but never quite successful enough to impress Hank. Evan, by contrast, had a knack for screwing up, though he’d earned a special place in Hank’s heart over the years for having the guts to defy him. When Evan began to prove himself Jeff’s equal in the family business, it was more than Jeff could handle. In June 1995, the combination of this fraternal competition and his father’s suffocating management style led Jeff to resign—and walk away from what many observers expected would be his eventual takeover of the company.
Jeff Greenberg landed at the giant insurance brokerage Marsh & McLennan, where within four years he rose to CEO. It was a triumph, confirmation that he was ultimately his own man. Then two weeks ago, with the firm under fire from New York attorney general Eliot Spitzer, Jeff Greenberg’s career came crashing down. Spitzer is accusing Marsh & McLennan of rigging what were supposed to be competitive bids and collecting kickbacks from insurance companies in exchange for lucrative business. Watching Jeff tender his resignation, you could be forgiven for concluding he was just another greedy CEO getting his comeuppance. But in fact, it’s impossible to judge the story of Jeff Greenberg’s rise and fall without understanding the family dynamics that drove him throughout his career.
When AIG went public in 1969, Hank Greenberg became a very wealthy man, something that would have been difficult to imagine when he set out on his professional career. Hank had come home from the second of two tours of duty in the Army (the first saw him storm Omaha Beach as a Ranger, the second put him in Korea as a military lawyer) in desperate need of a job to support his wife and newborn son Jeff. He went looking for one up and down William Street, then the center of the New York City insurance industry. Legend has it Hank eventually talked his way into an entry-level underwriting position at Continental Casualty after treating the boss of a dismissive personnel employee to an animated lecture on deportment.
That was 1952. By 1959, Hank had moved to Chicago and become the youngest vice-president ever at Continental, overseeing the company’s accident- and health-insurance operations. Then, in 1960, a mentor of Greenberg’s recommended Hank for a job at American International Companies. By 1962, Hank had taken over the company’s domestic operations, American Home, which at that point could barely be considered “third-rate,” according to David Schiff, the dean of insurance-industry analysts. Hank transformed it into a steady source of profits. Some five years later, buoyed by this success, he took over as head of the entire company, which he incorporated as AIG.
Though Hank ran a company with hundreds of millions in annual revenue, the Greenberg household in the early seventies hardly gave the impression of abundant wealth. The Greenbergs lived in a fairly modest three-bedroom apartment on Park Avenue, with Jeff, Evan, and younger brother Scott sharing a bedroom when they were home from boarding school or college. The kids were “not arrogant for the amount of money they had, less arrogant than most,” says Mark Abouzeid, the son of an AIG executive who grew up around the Greenbergs. In fact, Hank was determined not to flaunt his good fortune. Friends were struck by how proud the family was that its modest country home in Brewster, New York, looked even smaller from the roadside.
Visitors to the Greenberg residence at the time recall Hank as an almost compulsively disciplined and health-conscious man. The family routinely ate tofu, long before it was fashionable; Hank rode his exercise bike every morning while watching the Today show. Even Thanksgivings were hardly feasts. “I was always on a diet, but everybody would watch what everybody ate,” says Nikki Finke, a Hollywood columnist who was Jeff’s first wife and who first met the family when Evan and Jeff were teenagers. “It wasn’t like, ‘Loosen your belt.’ For Hank and [wife] Corinne, it was more to see how little could you eat.”