Hank Greenberg |
Embattled AIG CEO Hank Greenberg, under fraud charges in 2006 by New York State and investigations by the SEC and Justice Dept., hired Cambridge, Mass., “think tank” eSapience to burnish the company’s image.
Greenberg had gone through seven other PR firms in rapid succession, writes Jonathan Bandler in the Oct. 13 Fortune, before settling on what the magazine calls “a little-known media and research firm.”
eSapience, headed by Karen Webster, promised to position Greenberg as a “visible and highly credible voice about public issues that are completely unrelated to his legal situation.” The initial plan cost AIG $100,000.
The strategy was not to go directly to the media but to “influentials” including public intellectuals, policymakers and advisors who affect debate.
Richard Schmalensee |
Two “think tanks” were created, the Barbon Institute, named after Nicholas Barbon, the creator of fire insurance, and the eSapience Center for Law and Business.
Greenberg then spoke at a conference in the St. Regis Hotel, New York, about the need for insurance by the government and private industry in case of further terrorist attacks.
Working with the PR firm was Richard Schmalensee, who was dean of MIT’s Sloan School, and Webster’s husband, law professor david Evans. Several other academics were also involved including David Evans, adjunct professor, University College London, and Richard Epstein, University of Chicago law professor, said court documents.
Howard Opinsky |
Opinsky Chief PR Strategist
Howard Opinsky, with Powell Tate/Weber Shandwick, an AIG PR firm, and described by Bandler as Greenberg’s “main media strategist,” objected “strenuously” to the plan.
Bandler does not name any PR firms but eSapience but one of them was the Brunswick Group.
eSapience’s bills, at $400 to $1,000 per hour of work, were nearly $500,000 a month and Greenberg eventually stopped paying them, resulting in a $2 million lawsuit vs. AIG.
It was settled out of court but the court papers exposed the relationship to coverage in the Boston Globe and other media. |