AIG.WS American International Group Inc

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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American International Group, Inc.

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March 31, 2020​

Dear Fellow AIG Shareholder,

Since late-2017, senior management has undertaken a series of significant actions to reduce AIG’s risk profile and position the Company for long-term, sustainable and profitable growth. AIG’s improved financial performance in 2019 reflects significant progress on our journey to become a leading insurance franchise and top performing company. Notable achievements in 2019 include:

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Delivering on our commitment to return to full-year underwriting profitability in General Insurance, driven by instilling a culture of underwriting excellence, executing on a new risk appetite, overhauling AIG’s reinsurance strategy and program, and driving expense discipline;

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•

Life and Retirement achieving solid results in the face of continued headwinds from low interest rates and tightening credit spreads;

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Net Investment Income of  $14.6 billion, increasing from $12.5 billion in the prior year; and

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Signing an agreement to sell a majority interest in Fortitude Group Holdings, LLC, reflecting a significant milestone in de-risking our Legacy portfolio.

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In 2019, we also began significant foundational work to shape AIG 200, our global, multi-year effort focused on the long-term strategic positioning of AIG.

Additional information on our strategy, 2019 financial performance, governance practices and shareholder engagement program is included in this 2020 Proxy Statement and the 2019 Annual Report. We encourage you to read these materials and vote as we recommend on the enclosed proposals.

AIG’s 2020 Annual Meeting of Shareholders will be held virtually via the Internet on Wednesday, May 13, 2020, at 11:00 a.m., Eastern Daylight Time, to protect the safety and well-being of our shareholders and employees in light of the COVID-19 outbreak. We encourage you to vote in advance of the meeting even if you plan to participate virtually. Every vote matters.

As we move further into 2020, we continue to closely monitor developments related to the COVID-19 pandemic. We have activated business continuity plans so we can keep colleagues safe while continuing to serve the needs of our stakeholders without significant disruption. Despite the uncertainty created by the coronavirus and related volatility in financial markets, we remain focused on delivering value for you over the long term.

Thank you for entrusting us with your capital.

Table of Contents

​	Executive Summary	​	​	​	​	1	​	​
​	Proposal 1—Election of Directors	​	​	​	​	10	​	​
​	Corporate Governance	​	​	​	​	17	​	​
​	Our Corporate Governance Practices	​	​	​	​	17	​	​
​	Director Independence	​	​	​	​	18	​	​
​	Board Effectiveness	​	​	​	​	18	​	​
​	Board Composition and Refreshment	​	​	​	​	20	​	​
​	Areas of Board Oversight	​	​	​	​	21	​	​
​	Committees	​	​	​	​	23	​	​
​	Compensation of Directors	​	​	​	​	27	​	​
​	Corporate Governance Materials Available on our Website	​	​	​	​	30	​	​
​	Year-Round Shareholder Engagement	​	​	​	​	31	​	​
​	Ownership of Certain Securities	​	​	​	​	34	​	​
​	Delinquent Section 16(a) Reports	​	​	​	​	36	​	​
​	Relationships and Related-Party Transactions	​	​	​	​	36	​	​
​	Our Executive Officers	​	​	​	​	37	​	​
​	Executive Compensation	​	​	​	​	41	​	​
​	Letter from the Compensation and Management Resources Committee	​	​	​	​	41	​	​
​	Compensation Discussion and Analysis	​	​	​	​	42	​	​
​	Report of the Compensation and Management Resources Committee	​	​	​	​	80	​	​
​	2019 Compensation	​	​	​	​	81	​	​
​	Holdings of and Vesting of Previously Awarded Equity	​	​	​	​	84	​	​
​	Post-Employment Compensation	​	​	​	​	86	​	​
​	Potential Payments on Termination	​	​	​	​	89	​	​
​	Pay Ratio	​	​	​	​	94	​	​
​	Equity Compensation Plan Information	​	​	​	​	95	​	​
​	Proposal 2—Non-Binding Advisory Vote to Approve Executive Compensation	​	​	​	​	96	​	​
​	Background to Proposals 3 and 4	​	​	​	​	98	​	​
​	Proposal 3—Approval of Amendment and Restatement of AIG’s Amended and Restated Certificate of Incorporation	​	​	​	​	101	​	​

​	Proposal 4—Ratification of Amendment No. 3 to the Tax Asset Protection Plan	​	​	​	​	107	​	​
​	Report of the Audit Committee and Ratification of Selection of Accountants	​	​	​	​	110	​	​
​	Report of the Audit Committee	​	​	​	​	110	​	​
​	Proposal 5—Ratification of Selection of PricewaterhouseCoopers LLP	​	​	​	​	112	​	​
​	Fees Paid to PricewaterhouseCoopers LLP	​	​	​	​	113	​	​
​	Proposal 6—Shareholder Proposal on Special Shareholder Meetings	​	​	​	​	115	​	​
​	Shareholder Proposal	​	​	​	​	115	​	​
​	AIG Statement in Opposition	​	​	​	​	116	​	​
​	Voting Instructions and Information	​	​	​	​	119	​	​
​	Other Matters	​	​	​	​	124	​	​
​	Other Matters to be Presented during the 2020 Annual Meeting of Shareholders	​	​	​	​	124	​	​
​	Shareholder Proposals for the 2021 Annual Meeting	​	​	​	​	124	​	​
​	Communications with the Board of Directors	​	​	​	​	124	​	​
​	Electronic Delivery of Proxy Materials	​	​	​	​	124	​	​
​	Important Notice Regarding Delivery of Shareholder Documents	​	​	​	​	125	​	​
​	Incorporation by Reference	​	​	​	​	125	​	​
​	Cautionary Statement Regarding Forward-Looking Information	​	​	​	​	126	​	​
​	Non-GAAP Financial Measures	​	​	​	​	A-1	​	​
​	Proposed American International Group, Inc. Amended and Restated Certificate of Incorporation	​	​	​	​	B-1	​	​
​	American International Group, Inc. Tax Asset Protection Plan	​	​	​	​	C-1	​	​
​	Amendment No. 1 to the American International Group, Inc. Tax Asset Protection Plan	​	​	​	​	D-1	​	​
​	Amendment No. 2 to the American International Group, Inc. Tax Asset Protection Plan	​	​	​	​	E-1	​	​
​	Amendment No. 3 to the American International Group, Inc. Tax Asset Protection Plan	​	​	​	​	F-1	​	​

Executive Summary​

Executive Summary

This summary highlights information contained in this Proxy Statement. It does not contain all of the information you should consider in making a voting decision, and you should read the entire Proxy Statement carefully before voting. These proxy materials are first being sent to shareholders of American International Group, Inc., a Delaware corporation (AIG), commencing on or about March 31, 2020.

2020 Proxy Statement 1​

Executive Summary

ABOUT AIG

AIG is a leading global insurance organization. Building on our long history, we provide a wide range of property casualty insurance, life insurance, retirement solutions, and other financial services to customers in more than 80 countries and jurisdictions.

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Executive Summary​

2019 PERFORMANCE HIGHLIGHTS

The impact of the steps that we took in 2018 and 2019 is evident in AIG’s 2019 financial performance.

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Accident Year Combined Ratio, As Adjusted is a Non-GAAP financial measure. See Appendix A for a reconciliation showing how this
measure is calculated from our audited financial statements.

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TSR calculated based on (1) the average stock prices for the month preceding the first day of the performance period; and (2) the average stock prices for the final month of the performance period.

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Represents the median of the insurance sector (GICS 4030) companies in the S&P 500 (S&P 500 Insurance Companies).

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2020 Proxy Statement 3​

Executive Summary

COMPENSATION HIGHLIGHTS

2019 was an important year in the continued turnaround of the General Insurance business and overall strengthening of AIG, building on the leadership and structural changes made since mid-2017. AIG’s financial performance in 2019 reflected the significant progress being made on the execution of management’s strategy to position AIG for long-term, sustainable growth. These strong results are reflected in the decisions we made with respect to our 2019 compensation programs, aligning with our overall philosophy of pay for performance.

CONTINUED SHAREHOLDER ENGAGEMENT

In 2019, we continued to engage in robust discussions with our shareholders on a number of corporate governance matters. Given the results of our 2018 and 2019 say-on-pay votes, a key focus of our ongoing engagement in 2019 was to further understand their views with respect to our executive compensation programs. In response to feedback received during our engagement meetings, the Compensation and Management Resources Committee (CMRC) made several changes to AIG’s executive compensation programs, including the Short-Term Incentive (STI) and Long-Term Incentive (LTI) programs:

4 2020 Proxy Statement

Executive Summary​

2019 PERFORMANCE-BASED COMPENSATION AND ALIGNMENT OF PAY WITH SHAREHOLDER EXPERIENCE

In 2019, the impact of the foundational steps AIG has taken since late 2017 to improve performance through management and structural changes and the General Insurance turnaround was evident in our full-year financial results. This includes significant improvement in General Insurance performance, continued solid results from Life and Retirement, Net Investment Income performance above benchmarks and efficient management of our Legacy portfolio. In addition to the improved full-year financial results, AIG’s shareholders experienced a total return of 37% in 2019, outperforming both the median S&P 500 Insurance Company and the S&P 500 as a whole. These strong 2019 results are reflected in the decisions the CMRC and AIG’s Board of Directors (the Board) made with respect to our 2019 STI program. With respect to Mr. Duperreault, our Chief Executive Officer, the CMRC recommended, and the Board approved, an individual performance score of 150%, which, when combined with the Headquarters quantitative performance score of 123%, resulted in a STI payment of  $5,920,000, representing 185% of target.

AIG’s stock price has been especially sensitive to market volatility in recent years as the impact of legacy management strategies continued to significantly impact financial results. This has led to AIG’s TSR over the three-year period ending on December 31, 2019 ranking below the lower quartile relative to peers, resulting in a 0% payout on our PSUs granted in 2017. Given the performance-based structure of our executive compensation program, this stock performance has impacted equity payouts and realized equity value for our executives, commensurate with returns to our shareholders. Relative to the target value at the date of grant, as of December 31, 2019, the value of our PSUs and stock options granted between 2015 and 2018 is substantially below target—20% for our Chief Executive Officer. This reflects little or no vesting of PSUs and share price translating into underwater stock options.

2020 Proxy Statement 5​

Executive Summary

The following chart shows the correlation between TSR and the compensation awarded to our Chief Executive Officer over the past three years. Our executive compensation program aligns pay with performance and the experience of our shareholders

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Executive Summary  

We believe our nominees’ diverse and complementary experiences and skills promote a well-functioning, highly qualified and independent Board of Directors. AIG has undertaken significant Board refreshment in recent years to ensure that the directors are positioned to provide strategic guidance to AIG as we continue our journey focused on operational excellence.

KEY QUALIFICATIONS OF OUR INDEPENDENT DIRECTOR NOMINEES

INDEPENDENT DIRECTOR NOMINEE
TENURE

INDEPENDENT DIRECTOR NOMINEE
DIVERSITY

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2020 Proxy Statement 13​

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2020 Proxy Statement 15​

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Corporate Governance  OUR CORPORATE GOVERNANCE PRACTICES​

Corporate Governance

OUR CORPORATE GOVERNANCE PRACTICES

The AIG Board is committed to good corporate governance. Our strong corporate governance policies and practices are set forth in our Amended and Restated Certificate of Incorporation, By-laws, Corporate Governance Guidelines and Committee Charters, among other documents. AIG’s Board regularly reviews these corporate governance documents and makes modifications from time to time based on corporate governance developments and shareholder feedback to ensure continued effectiveness.

2020 Proxy Statement 17​

Corporate Governance DIRECTOR INDEPENDENCE

DIRECTOR INDEPENDENCE

AIG aims to maintain a balanced and independent Board that is committed to representing the long-term interests of AIG’s shareholders, and which has the substantial and diverse expertise necessary to oversee AIG’s strategic and business planning as well as management’s approach to addressing significant risks and challenges facing AIG.

DIRECTOR INDEPENDENCE ASSESSMENT

Using the AIG Director Independence Standards, the Board, on the recommendation of the Nominating and Corporate Governance Committee, determined that each of AIG’s eleven independent director nominees—Mss. Mills, Schioldager and Vaughan and Messrs. Cornwell, Fitzpatrick, Jurgensen, Lynch, Miller, Motamed, Porrino and Steenland—are independent under the New York Stock Exchange (NYSE) listing standards and the AIG Director Independence Standards. Mr. Duperreault is the only director nominee who holds an AIG management position and, therefore, is not an independent director. Ms. Nora Johnson, who is not standing for re-election to the Board, and Ronald A. Rittenmeyer and Theresa M. Stone, who did not stand for re-election at the 2019 Annual Meeting, were also determined by the Board, on the recommendation of the Nominating and Corporate Governance Committee, to be independent under the NYSE listing standards and the AIG Director Independence Standards for the period that they served on the Board.

In making the independence determinations, the Nominating and Corporate Governance Committee and the Board considered relationships arising from: (1) in the case of certain directors, contributions by AIG to charitable organizations with which they are affiliated; (2) in the case of certain directors, investments and insurance products AIG provides to them and/or entities they are affiliated with in the ordinary course of business and on the same terms made available to third parties; and (3) in the case of Mr. Lynch, the employment of his son by the Company. None of these relationships exceeded the thresholds set forth in the NYSE listing standards and the AIG Director Independence Standards.

INDEPENDENT CHAIR

The current Chair of AIG’s Board, Mr. Steenland, is an independent director. The Independent Chair focuses on the governance of the Board and interacts with AIG’s various stakeholders. AIG’s Corporate Governance Guidelines provide for an annual review of the Independent Chair. Our current Independent Chair, Mr. Steenland, has served in this position since July 2015.

The duties of the Independent Chair of the Board are clearly defined and include:

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Overseeing Board meeting agenda preparation in consultation with the Chief Executive Officer and preparing agendas for meetings of the independent directors;

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Chairing Board meetings and executive sessions of the independent directors;

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Leading the independent directors in the Chief Executive Officer review process and discussions regarding management succession;

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Interacting regularly with the Chief Executive Officer, including discussing strategic initiatives and their implementation;

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Overseeing distribution of information and reports to the Board;

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Overseeing the Board and Board Committees’ annual self-evaluation process;

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Serving as non-voting member of each Board Committee; and

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Participating in engagement with shareholders.

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BOARD EFFECTIVENESS

ATTENDANCE AT BOARD AND COMMITTEE MEETINGS

The Board considers director attendance at Board and Committee meetings an essential duty of a director. As a result, AIG’s Corporate Governance Guidelines provide that any director who, for two consecutive calendar years, attends fewer than 75 percent of the total regular meetings of the Board and the meetings of all Committees of

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Corporate Governance BOARD EFFECTIVENESS​

which such director is a voting member, will not be nominated for re-election at the annual meeting in the next succeeding calendar year, absent special circumstances that may be taken into account by the Board and the Nominating and Corporate Governance Committee in making its recommendations to the Board.

There were 10 meetings of the Board during 2019. The independent directors meet in executive session, without the Chief Executive Officer present, in conjunction with each regularly scheduled Board meeting. Mr. Steenland, as Independent Chair of the Board, presided at the executive sessions. There were a total of 33 meetings of the Committees of the Board during 2019. For 2019, all of the directors attended at least 75 percent of the aggregate of all meetings of the Board and of the Committees of the Board on which they served.

Pursuant to the Corporate Governance Guidelines, all directors are generally expected to attend the Annual Meeting. All directors who stood for election at the 2019 Annual Meeting attended the 2019 Annual Meeting.

DIRECTOR AND BOARD ACCOUNTABILITY AND EVALUATIONS

The AIG Board believes that self-evaluations of the Board, the standing Committees of the Board and individual directors are important elements of corporate governance and to ensuring a well-functioning Board. Pursuant to AIG’s Corporate Governance Guidelines, the Board, acting through the Nominating and Corporate Governance Committee and under the general oversight of the Independent Chair, conducts an annual self-evaluation and an evaluation of each member of the Board. Throughout the year, each standing Committee also conducts its own annual self-evaluation.

This year, reflecting the Board’s alignment with AIG’s journey to return to operational excellence and adopt a culture of continuous improvement, the Board reviewed its approach to the Board and director evaluation process and implemented several changes designed to enhance the value and effectiveness of the assessment.

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Corporate Governance BOARD COMPOSITION AND REFRESHMENT

BOARD COMPOSITION AND REFRESHMENT

Balanced and effective Board composition, supplemented by a thoughtful approach to refreshment, is a priority for AIG. The selection of a qualified group of directors with an appropriate mix of skills and experience is essential to the Board’s successful oversight of AIG’s complex business, particularly as the Board provides strategic oversight of AIG’s journey. The Board manages Board composition and refreshment with significant support from its Nominating and Corporate Governance Committee.

The Nominating and Corporate Governance Committee continuously reviews the composition of our Board, taking into consideration the characteristics of the existing directors, both individually and as a group. The Nominating and Corporate Governance Committee considers Board refreshment in light of various factors, including expected director departures, the Board’s mix and interplay of skills and experience, diversity and individual director performance.

DIRECTOR RECRUITMENT PROCESS

The Nominating and Corporate Governance Committee has a robust director recruitment process. New director candidates are identified through various channels, including third-party search firms, other directors, shareholders and members of management. Once a candidate has been identified, the Nominating and Corporate Governance Committee conducts a rigorous review, taking into consideration the criteria set forth in AIG’s Corporate Governance Guidelines, including:

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high personal and professional ethics, values and integrity;

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ability to work together as part of an effective, collegial group;

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commitment to representing the long-term interests of AIG;

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skill, expertise, diversity, background, and experience with businesses and other organizations that the Board deems relevant;

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the interplay of the individual’s experience with the experience of other Board members;

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the contribution represented by the individual’s skills and experience to ensuring that the Board has the necessary tools to perform its oversight function effectively;

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ability and willingness to commit adequate time to AIG over an extended period of time; and

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the extent to which the individual would otherwise be a desirable addition to the Board and any Committees of the Board.

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Following this review, the Nominating and Corporate Governance Committee recommends potential directors to the full Board for approval of their appointment or election by our shareholders.

In 2019, the Nominating and Corporate Governance Committee oversaw the identification, recruitment and review of four new directors: Messrs. Motamed and Porrino and Mss. Schioldager and Vaughan. Messrs. Motamed and Porrino and Ms. Vaughan each have considerable insurance industry experience and Ms. Schioldager brings substantial experience in investments, asset management and corporate governance. Further, the addition of these directors improved the diversity of our Board.

DIRECTOR TENURE

The Board believes that it is desirable to maintain a mix of longer-tenured, experienced directors and newer directors with fresh perspectives. The average tenure of the independent director nominees is six years. In addition, under AIG’s Corporate Governance Guidelines, the Committee Chairs generally do not serve for longer than a five-year term. No individual may stand for election as a director after reaching the age of 75, and the Board may only waive this requirement for a one-year period if, on the recommendation of the Nominating and Corporate Governance Committee, it determines such waiver to be in the best interests of AIG.

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Corporate Governance AREAS OF BOARD OVERSIGHT​

DIVERSITY CONSIDERATION

The Board strives to maintain a diverse Board, and diversity continues to be an important consideration in the Nominating and Corporate Governance Committee’s director search and nomination process. The Board believes that important diversity characteristics include race, gender identity, ethnicity, religion, nationality, disability, sexual orientation and cultural background, although it has determined not to adopt a specific diversity policy. Additionally, in assessing each director candidate, the Nominating and Corporate Governance Committee considers diversity in a broad sense, including a candidate’s work experience, skills and perspective. One-third of AIG’s independent director nominees are women or ethnically diverse.

DIRECTOR RECOMMENDATIONS BY SHAREHOLDERS

The Nominating and Corporate Governance Committee considers shareholder feedback when determining whether to recommend that the Board nominate a director for re-election and takes into account the views of interested shareholders as appropriate when filling a vacancy on the Board. The AIG Corporate Governance Guidelines include characteristics that the Nominating and Corporate Governance Committee considers important for nominees for director and information for shareholders with respect to director nominations. The Nominating and Corporate Governance Committee will consider director nominees recommended by shareholders and will evaluate shareholder nominees on the same basis as all other nominees. Shareholders who wish to submit nominees for director for consideration by the Nominating and Corporate Governance Committee may do so by submitting names and supporting information to: Chair, Nominating and Corporate Governance Committee, c/o Corporate Secretary, American International Group, Inc., 175 Water Street, New York, New York 10038.

PROXY ACCESS

AIG’s By-laws also permit eligible shareholders with a significant long-term interest in AIG to include their own director nominees in AIG’s proxy statement for the annual meeting. The Board believes such proxy access is an additional mechanism for Board accountability and for ensuring that Board nominees are supported by AIG’s long-term shareholders.

Under the proxy access by-law, a shareholder, or a group of up to 20 shareholders, owning three percent or more of AIG common stock continuously for at least three years may nominate and include in AIG’s annual meeting proxy materials director nominees constituting up to the greater of two individuals or 20 percent of the Board of Directors, so long as the shareholder(s) and the nominee(s) satisfy the requirements specified in AIG’s By-laws. Qualifying shareholders who wish to submit director nominees for election at the 2021 Annual Meeting of Shareholders pursuant to the proxy access by-law may do so in compliance with the procedures described in “Other Matters—Shareholder Proposals for the 2021 Annual Meeting.”

AREAS OF BOARD OVERSIGHT

The Board fulfils its oversight role with respect to AIG’s strategy through year-round discussions and presentations covering company-wide and business unit-specific updates. The Board also provides oversight with respect to other key areas, including risk management, cybersecurity, management succession planning and sustainability and corporate social responsibility.

RISK MANAGEMENT

The Board oversees the management of risk (including, for example, risks related to market conditions, reserves, catastrophes, investments, liquidity, capital and cybersecurity) through the complementary functioning of the Risk and Capital Committee and the Audit Committee and interacting and coordinating with other Committees of the Board. The Risk and Capital Committee oversees AIG’s Enterprise Risk Management (ERM) as one of its core responsibilities and reviews AIG’s significant risk assessment and risk management policies. The Audit Committee also evaluates and oversees the guidelines and policies governing AIG’s risk assessment and management process as well as the risk control framework. The Chairs of the two Committees then coordinate with each other and the Chairs of the other Committees of the Board with the aim to ensure that each Committee has received the information that it needs to carry out its responsibilities with respect to risk management. Both

2020 Proxy Statement 21​

Corporate Governance Areas of Board Oversight

the Risk and Capital Committee and the Audit Committee report to the Board with respect to relevant risk management issues. The CMRC, in conjunction with AIG’s Chief Risk Officer, is responsible for reviewing the relationship between AIG’s risk management policies and practices and the incentive compensation arrangements applicable to senior executives. For further information regarding the annual risk assessment of compensation plans, see “Executive Compensation—Report of the Compensation and Management Resources Committee.”​

CYBERSECURITY

The Technology Committee reviews AIG’s cybersecurity risks, policies, controls and procedures, including: (1) AIG’s procedures to identify and assess internal and external cybersecurity risks, (2) AIG’s controls to protect from cyberattacks, unauthorized access or other malicious acts and risks, (3) AIG’s procedures to detect, respond to, mitigate negative effects from and recover from cybersecurity attacks, (4) AIG’s controls and procedures for fulfilling applicable regulatory reporting and disclosure obligations related to cybersecurity risks, costs and incidents and (5) AIG’s cybersecurity practices as compared to industry practices.

MANAGEMENT SUCCESSION PLANNING

The Board recognizes the importance of planning for management succession and oversees succession planning with support from the CMRC. In accordance with AIG’s Corporate Governance Guidelines and the CMRC’s Charter, at least annually:

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the Chief Executive Officer reports to the CMRC and the Chair of the Nominating and Corporate Governance Committee on plans for succession for both the Chief Executive Officer role and other senior management roles; and

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the CMRC reports to the Board on its view of those plans.

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SUSTAINABILITY AND CORPORATE SOCIAL RESPONSIBILITY

AIG believes that a continued commitment to sustainability can deliver long-term value to our company, our stakeholders and our global community. The Nominating and Corporate Governance Committee oversees and reports to the Board as necessary with respect to sustainability, corporate social responsibility and public policy matters. Both the Nominating and Corporate Governance Committee and the Board receive regular reports on sustainability-related matters.

Additional Information Available on our New Corporate Responsibility Site

To review our TCFD report and detailed information about AIG’s philosophy and practices regarding sustainability (including climate change projects and microinsurance) and community (including philanthropy, volunteerism and diversity), please visit our new corporate responsibility site at https://www.aig.com/corporate-responsibility. This information is not incorporated by reference, and does not form part of, this Proxy Statement.

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Corporate Governance COMMITTEES​

COMMITTEES

AIG’s Board Committee structure is organized around key strategic issues. Committee Chairs regularly coordinate with one another to ensure appropriate information sharing. To further facilitate information sharing, all Committees provide a summary of significant actions to the full Board. As required under AIG’s Corporate Governance Guidelines, each standing Committee conducts an annual self-assessment and review of its charter.​

The following table sets forth the current membership on each standing Committee of the Board and the number of Committee meetings held in 2019. Mr. Duperreault does not serve on any Committees of the Board. Mr. Steenland serves as an ex-officio, non-voting member of each Committee.

C

= Chair

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■

= Member

​

♦

Mr. Steenland, as Independent Chair of the Board, is an ex-officio, non-voting member.

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2020 Proxy Statement 23​

2020 Proxy Statement 25​

Corporate Governance COMPENSATION OF DIRECTORS

Each DSU provides that one share of AIG common stock will be delivered when an independent director ceases to be a member of the Board and includes dividend equivalent rights that entitle the independent director to a quarterly payment, in the form of DSUs, equal to the amount of any regular quarterly dividend that would have been paid by AIG if the shares of AIG common stock underlying the DSUs had been outstanding. DSUs are granted under the AIG 2013 Omnibus Incentive Plan (2013 Omnibus Incentive Plan).

In January 2019, the Nominating and Corporate Governance Committee completed its annual review of the AIG independent director compensation program. The review used the same peer group used for the executive compensation program. Based on that review, the Committee concluded that no changes were needed to the independent director compensation program at that time.

Under director stock ownership guidelines, independent directors should own a number of shares of AIG common stock (including deferred stock and DSUs) with a value equal to at least five times the annual retainer for independent directors.

AIG’s Insider Trading Policy prohibits directors from engaging in hedging transactions with respect to any AIG securities, including by trading in any derivative security relating to AIG’s securities. In particular, other than pursuant to an AIG compensation or benefit plan or dividend distribution and other than the warrants issued by AIG in January 2011, directors may not acquire, write or otherwise enter into an instrument that has a value determined by reference to AIG securities, whether or not the instrument is issued by AIG. Examples include put and call options, forward contracts, collars and equity swaps relating to AIG securities. In addition, AIG’s Insider Trading Policy prohibits directors from pledging AIG securities and none of AIG’s directors have pledged any AIG’s securities.

Mr. Duperreault did not receive any compensation for service as a director.

Frederic W. Cook & Co. (FW Cook) provided advice to the Nominating and Corporate Governance Committee with respect to AIG director compensation and related market practices. Both the cash and equity components of independent director compensation remain subject to the shareholder-approved limits established in the 2013 Omnibus Incentive Plan.

28 2020 Proxy Statement

Corporate Governance COMPENSATION OF DIRECTORS​

The following table contains information with respect to the compensation of the individuals who served as independent directors of AIG for all or part of 2019.

2019 INDEPENDENT DIRECTOR COMPENSATION

(1)

This column represents annual retainer fees, Independent Chair retainer fees and Committee Chair retainer fees. For Mr. Fitzpatrick, the amount includes a prorated Committee Chair retainer fee for his service as Chair of the Risk and Capital Committee until the date of the 2019 Annual Meeting. For Ms. Mills, the amount includes a prorated Committee Chair retainer fee for her service as Chair of the Technology Committee, effective as of the date of the 2019 Annual Meeting. For Mr. Motamed, the amount includes a prorated annual retainer fee for his service as director beginning January 15, 2019. For Mr. Porrino and Mss. Schioldager and Vaughan, the amounts include a prorated annual retainer fee for their service as directors from the date of the 2019 Annual Meeting. For Ms. Nora Johnson, the amount includes a prorated Committee Chair retainer fee for her service as Chair of the Risk and Capital Committee, effective as of the date of the 2019 Annual Meeting. For Mr. Rittenmeyer and Ms. Stone, the amounts include prorated annual retainer fees for their service as directors until the date of the 2019 Annual Meeting. For Mr. Rittenmeyer, the amount does not include (i) $997,755, which represents the value of shares of AIG common stock delivered when he ceased to be a member of the Board as of the 2019 Annual Meeting in accordance with the terms of DSUs previously granted; and (ii) $6,883, which represents a cash payment with respect to warrant equivalents granted to him related to DSUs granted prior to the warrant distribution. For Ms. Stone, the amount does not include $1,624,996, which represents the value of shares of AIG common stock delivered when she ceased to be a member of the Board as of the 2019 Annual Meeting in accordance with the terms of DSUs previously granted.

​

(2)

This column represents the grant date fair value of DSUs granted in 2019 to independent directors determined in accordance with Financial Accounting Standards Board Accounting Standards Codification (FASB ASC) Topic 718, based on the closing sale price of AIG common stock on the date of grant.

​

(3)

This column represents charitable contributions disbursed by AIG during 2019 under AIG’s Matching Grants Program, through which AIG provides a two-for-one match on charitable donations in an amount of up to $10,000 per independent director annually. For Messrs. Cornwell, Jurgensen and Miller and Mss. Mills, Nora Johnson and Stone, the amounts include certain charitable contributions previously disclosed in AIG’s 2019 Proxy Statement as AIG previously disclosed charitable contributions based on program year rather than disbursement year.

​

2020 Proxy Statement 29​

Corporate Governance CORPORATE GOVERNANCE MATERIALS AVAILABLE ON OUR WEBSITE

The following table sets forth information with respect to the stock awards outstanding at December 31, 2019 for the independent directors of AIG during 2019. None of the independent directors hold option awards.

(1)

DSUs shown include DSUs awarded in 2019 and prior years, any cash retainer amounts that a director elected to receive in DSUs and DSUs awarded as dividend equivalents. Receipt of shares of AIG common stock underlying DSUs is deferred until the director ceases to be a member of the Board. DSUs granted prior to May 12, 2010 were granted under the Amended and Restated AIG 2007 Stock Incentive Plan (2007 Stock Incentive Plan). DSUs granted on or after May 12, 2010 and prior to May 15, 2013 were granted under the AIG 2010 Stock Incentive Plan (2010 Stock Incentive Plan) and DSUs granted commencing on or after May 15, 2013 were granted under the 2013 Omnibus Incentive Plan.

​

(2)

Ms. Stone elected to defer the delivery of the shares of AIG common stock underlying these DSUs. One-fifth of the shares of AIG common stock underlying these DSUs will be deliverable on May 21 of each of 2020, 2021, 2022, 2023 and 2024.

​

CORPORATE GOVERNANCE MATERIALS AVAILABLE ON OUR WEBSITE

The following documents are available in the About Us—Leadership and Governance section of AIG’s corporate website at www.aig.com or in print by writing to American International Group, Inc., 175 Water Street, New York, New York 10038, Attention: Investor Relations:

•

Corporate Governance Guidelines (which include our Director Independence Standards)

​

•

Charters of the Audit Committee, the Compensation and Management Resources Committee, the Nominating and Corporate Governance Committee, the Risk and Capital Committee and the Technology Committee

​

•

AIG’s Director, Executive Officer and Senior Financial Officer Code of Business Conduct and Ethics

​

•

Code of Conduct for Employees

​

Any amendment to AIG’s Director, Executive Officer and Senior Financial Officer Code of Business Conduct and Ethics and any waiver applicable to AIG’s directors, executive officers or senior financial officers will be posted on AIG’s website within the time period required by the SEC and the NYSE.

30 2020 Proxy Statement

Year-Round Shareholder Engagement  Year-Round Shareholder Engagement PROGRAM​

Year-Round Shareholder Engagement

Fostering long-term relationships with our shareholders and maintaining their trust is a priority for the Board. Direct engagement with shareholders helps us gain useful feedback on a wide variety of topics, including corporate governance, executive compensation, corporate responsibility, business strategy and performance and related matters. Shareholder feedback also helps to better tailor the public information we disclose to address the interests and inquiries of shareholders.

YEAR-ROUND SHAREHOLDER ENGAGEMENT PROGRAM

AIG has developed a robust engagement program that ensures an active, ongoing dialogue with shareholders and other stakeholders throughout the year. These meetings strengthen AIG’s relationship with our shareholders and reinforce our commitment to incorporate shareholder feedback into various decisions made by the Board and management.

2020 Proxy Statement 31​

Year-Round Shareholder Engagement  2019 SHAREHOLDER ENGAGEMENT

2019 SHAREHOLDER ENGAGEMENT

During 2019, we continued our efforts to engage consistently and productively with our shareholders. Our Independent Chair and the Chair of our CMRC participated in many of these engagement meetings, alongside our General Counsel, Chief Human Resources Officer, Corporate Secretary, Head of Executive Compensation and Head of Investor Relations.

These efforts are complementary to outreach conducted by members of senior management through AIG’s Investor Relations department as they regularly meet with shareholders and participate in investor conferences in the United States and abroad. In 2019, our Investor Relations department led over 140 meetings with over 200 shareholders representing over 50% of our shares outstanding. Investor presentations are made available in the Investors—Webcasts and Presentations section of AIG’s corporate website at www.aig.com.

TOPICS COVERED DURING 2019 SHAREHOLDER ENGAGEMENT

Given the results of our 2018 and 2019 say-on-pay votes, a key focus of our ongoing engagement with shareholders in 2019 was to further understand their views with respect to our executive compensation programs. For details on the executive compensation-related feedback we heard from shareholders and how we responded, see “Executive Compensation—Compensation Discussion and Analysis—Shareholder Engagement.”

In addition to executive compensation, these meetings covered additional topics such as corporate strategy, succession planning, corporate governance and Board practices and environmental and social issues. Some key messages we heard included:

•

Strong support for the management team and the strategy and direction of AIG;

​

•

Desire for more clarity on the Board’s approach to management succession planning;

​

•

Positive feedback related to our appointment of a Chief Sustainability Officer and the publication of our inaugural TCFD report (See “Corporate Governance—Areas of Board Oversight—Sustainability and Corporate Social Responsibility”); and

​

32 2020 Proxy Statement

Year-Round Shareholder Engagement  2019 SHAREHOLDER ENGAGEMENT​

•

Desire for proxy disclosures that provide shareholders clearer insight into the Board’s decision-making process on various topics.

​

Shareholder feedback is communicated directly to our directors and helps inform Board discussions on a range of key areas. Going forward, AIG and the Board remain committed to consistent and substantive shareholder engagement and to incorporating shareholder perspectives in our governance and compensation discussions and corporate responsibility issues.

2020 Proxy Statement 33​

Delinquent Section 16(a) Reports

Delinquent Section 16(a) Reports

Section 16(a) of the Securities Exchange Act of 1934 (Exchange Act) requires directors, certain officers, and greater than ten percent holders of AIG common stock to file reports with respect to their ownership of AIG equity securities. Based solely on the review of the Forms 3, 4 and 5 and amendments thereto furnished to AIG and certain representations made to AIG, AIG believes that the only filing deficiencies under Section 16(a) by its directors, officers and greater than ten percent holders during 2019 were amendments to Forms 4 filed by each of Douglas A. Dachille, Kevin T. Hogan and Alessandrea C. Quane reporting shares withheld for the payment of taxes relating to the settlement of restricted stock units (RSUs) that vested at the end of March 2019.

Relationships and Related-Party Transactions

RELATED-PARTY TRANSACTIONS APPROVAL POLICY

The Board of AIG has adopted a related-party transactions approval policy. Under this written policy, any transaction that involves more than $120,000 and would be required to be disclosed in AIG’s Proxy Statement, between AIG or any of its subsidiaries and any director or executive officer, or their related persons, must be approved by the Nominating and Corporate Governance Committee (or, in certain circumstances where it is impractical or undesirable to seek the approval of the full Committee, by its Chair, acting on behalf of the full Committee). In determining whether or not to approve a related-party transaction, the Nominating and Corporate Governance Committee or its Chair, as applicable, considers:

•

Whether the terms of the transaction are fair to AIG and on terms at least as favorable as would apply if the other party was not or did not have an affiliation with a director, executive officer or employee of AIG;

​

•

Whether there are demonstrable business reasons for AIG to enter into the transaction;

​

•

Whether the transaction would impair the independence of a director; and

​

•

Whether the transaction would present an improper conflict of interest for any director, executive officer or employee of AIG, taking into account the size of the transaction, the overall financial position of the director, executive officer or employee, the direct or indirect nature of the interest of the director, executive officer or employee in the transaction, the ongoing nature of any proposed relationship and any other factors the Nominating and Corporate Governance Committee or its Chair, as applicable, deems relevant.

​

AIG did not have any related party transactions in 2019.

36 2020 Proxy Statement

2020 Proxy Statement 37​

38 2020 Proxy Statement

2020 Proxy Statement 39​

40 2020 Proxy Statement

LETTER FROM THE COMPENSATION AND MANAGEMENT RESOURCES COMMITTEE

The AIG Board and CMRC are committed to the highest standards of corporate governance and to overseeing an effective executive compensation program that reflects our shareholders’ best interests.

WHAT WE LEARNED FROM ENGAGING WITH OUR SHAREHOLDERS—AND WHAT WE CHANGED

Given the results of our 2018 and 2019 say-on-pay votes, a key focus of our ongoing engagement with shareholders in 2019 was to further understand their views with respect to our compensation programs. Our Independent Chair and the CMRC Chair participated in many of these engagement meetings, alongside our General Counsel, Chief Human Resources Officer, Corporate Secretary, Head of Executive Compensation and Head of Investor Relations. Based on the feedback received, we made responsive changes and refinements to our compensation programs.

Shareholders told us they wanted greater clarity around performance and pay decisions, fewer subjective STI metrics and increased use of relative metrics. We have made the following changes in response to these points:

•

Enhanced the Compensation Discussion and Analysis to improve clarity; in particular, we report metrics for all relevant businesses to enable shareholders to fully understand the Chief Executive Officer’s and other named executive officers’ (named executives) business quantitative performance scores under our STI plan

​

•

Eliminated subjective STI measures for business unit and headquarters quantitative performance, with a focus on empirical operating metrics

​

•

Used three relative performance metrics: (1) relative Calendar Year Combined Ratio for General Insurance, (2) performance relative to benchmarks for Investments and (3) relative TSR for AIG long-term performance

​

•

Added a TSR cap to PSU awards granted in 2019, limiting payouts to target if three-year returns are ranked below our median peer company

​

2019 PERFORMANCE

2019 was an important year in the continued turnaround of the General Insurance business, as well as the broader transformation of AIG, building on the leadership and structural changes made since mid-2017. AIG’s financial performance in 2019 reflected the significant progress being made on the execution of management’s strategy to position AIG for long-term, sustainable growth:

•

General Insurance showed significant improvement, with the business achieving a full-year underwriting profit for the first time in several years

​

•

Life and Retirement delivered consistent, solid results

​

•

Net Investment Income performance was above benchmarks

​

•

AIG’s Legacy portfolio was effectively managed with the signing of an agreement to sell a majority stake in Fortitude

​

•

2019 TSR of 37% outperformed the median of the S&P 500 Insurance Companies and the S&P 500 as a whole

​

These strong results are reflected in the decisions we made with respect to our 2019 compensation programs, aligning with our overall pay for performance philosophy. We believe that enhancements made to our Compensation Discussion and Analysis provide insight into our decision-making process as it relates to executive compensation.

LOOKING AHEAD

We are confident that our refined executive compensation programs attract, retain, reward and incentivize a committed world-class team of executives as AIG continues its journey to become both a leading insurance franchise and a top performing company.

On behalf of the Compensation and Management Resources Committee

Compensation and Management Resources Committee

W. Don Cornwell (Chair) Henry S. Miller Linda A. Mills Thomas F. Motamed Therese M. Vaughan

2020 Proxy Statement 41​

​

​

2019 Compensation Component

​

​

Duperreault​

​

​

Lyons​

​

​

Zaffino​

​

​

Dachille​

​

​

Hogan​

​

​

Target compensation, informed by market practices in our peer group

​

​

Base Salary

​

​

​

$

1,600,000

​

​

​

​

$

1,000,000

​

​

​

​

$

1,400,000

​

​

​

​

$

1,250,000

​

​

​

​

$

1,250,000

​

​

​

Target STI

​

​

​

$

3,200,000

​

​

​

​

$

1,700,000

​

​

​

​

$

3,000,000

​

​

​

​

$

2,500,000

​

​

​

​

$

2,250,000

​

​

​

Target LTI

​

​

​

$

11,200,000

​

​

​

​

$

3,300,000

​

​

​

​

$

5,600,000

​

​

​

​

$

4,250,000

​

​

​

​

$

4,000,000

​

​

​

Target Direct Compensation

​

​

​

$

16,000,000

​

​

​

​

$

6,000,000

​

​

​

​

$

10,000,000

​

​

​

​

$

8,000,000

​

​

​

​

$

7,500,000

​

​

​

Compensation decisions, informed by target compensation and business and individual performance

​

​

2019 STI Percent of Target Earned (Business Score x Individual Score)

​

​

185%

​

​

172%

​

​

200%

​

​

181%

​

​

113%

​

​

2019 Actual STI Award

​

​

​

$

5,920,000

​

​

​

​

$

2,924,000

​

​

​

​

$

6,000,000

​

​

​

​

$

4,525,000

​

​

​

​

$

2,542,500

​

​

​

2019 LTI Individual Modifier

​

​

​

​

—

​

​

​

112%

​

​

150%

​

​

108%

​

​

—

​

​

2019 Target LTI Grant

​

​

​

$

11,200,000

​

​

​

​

$

3,700,000

​

​

​

​

$

8,400,000

​

​

​

​

$

4,600,000

​

​

​

​

$

4,000,000

​

​

​

​

Executive Compensation  COMPENSATION DISCUSSION & ANALYSIS

AIG’S JOURNEY

AIG’s Journey and Aligning Compensation with Strategy

As AIG continues its journey to become a leading insurance franchise and a top performing company, the CMRC will continue to refine and evolve compensation programs to ensure alignment.

48 2020 Proxy Statement

Executive Compensation  COMPENSATION DISCUSSION & ANALYSIS​

*

Accident Year Combined Ratio, As Adjusted is a Non-GAAP financial measure. See Appendix A for a reconciliation showing how this measure is calculated from our audited financial statements.

​

*

TSR calculated based on (1) the average stock prices for the month preceding the first day of the performance period; and (2) the average stock prices for the final month of the performance period.

​

**

Represents the median of the S&P 500 Insurance Companies.

​

These key accomplishments in 2019, together with efforts that began in 2019 on AIG 200, are reflected in the outcomes for our STI program, with 2019 awards to named executives ranging from 113%-200% of target.

2020 Proxy Statement 49​

Executive Compensation  COMPENSATION DISCUSSION & ANALYSIS

SHAREHOLDER ENGAGEMENT

Our Approach

The CMRC views shareholder feedback as an important input into its decisions on executive compensation. In 2018 and 2019, while the majority of shareholders voted in favor of our compensation programs, levels of support dropped in light of our lagging share performance. In 2019, we expanded our shareholder outreach to gain additional insights and reinforce our commitment to incorporate shareholder feedback in the CMRC’s decision-making process.

For more details regarding our year-round shareholder engagement program and feedback in areas beyond executive compensation, see “Year-Round Shareholder Engagement” beginning on page 31.

Our Response to Shareholder Feedback on Executive Compensation

During engagement meetings with shareholders, we heard significant support for the recent modifications made to our executive compensation program that balance attracting, retaining, rewarding and incentivizing world-class talent during a significant turnaround and transformational journey against the desire to align pay with shareholder experience. In particular, without exception, our shareholders expressed strong support for our Chief Executive Officer, Brian Duperreault, and the executive leadership team he has assembled.

50 2020 Proxy Statement