You know your company’s made a horrible mistake when it is made an example of during the presidential debates.
One week after getting an $85 billion bailout from the government, insurance company AIG spent $440,000 on a corporate retreat at the St. Regis Monarch Beach resort in Dana Point, Calif. Senator Barak Obama pointed out the trip as an example of the horrible corruption of executives in the corporate world.
All I can think of is the meeting planner caught between a rock and a hard place, who had booked this gathering a year or more out: Had they canceled the meeting, they would have lost a lot of money in cancellation fees, and would have been criticized for wasting the money. Choosing not to “waste” the money has resulted in a snowball of negative publicity.
Marianne McNulty, CMP, CTIE, of Clever Concierge (who gave us permission to reprint her e-mail) pointed out on the MeCo listserve that, according to the hotel bill, it looked like the incentive was for about 200 people, so the price per person evened out to about $2,000 per attendee, a reasonable amount for an incentive program.
“It also appears that this was an independent agency convention,” McNulty wrote. “If the ‘price of admission’ was to sell an ‘increase over quota’ number of policies, then the program would be ‘funded’ by these incremental sales. This is definitely not an ‘executive corporate retreat’ made up of the AIG executive base, but independent insurance agencies who sold an increase of AIG products and were rewarded. This was a sunk cost expended some time prior to the bailout and separate from that critical issue. The pro-rated cost per person of this venture is taxable as income to the recipient, so some government entity profits from this expenditure in the long run, which does not happen if the program is canceled.”
What do you think?