You can learn a lot by the way companies generally act when employees leave for another job, whether it’s with suspicion, enthusiasm or indifference. But what does it say when a company doesn’t just pay an executive to do something else — it keeps right on paying him?
That’s what Aon Corp. (AON) did with Ted T. Devine, who stepped down as executive vice-president and president of Aon Risk Service on Nov. 18, 2009, though it wasn’t exactly clear from Aon’s announcement at the time.
Devine stepped down explicitly, if perhaps a little abruptly, to head up 1World Sports, a new nonprofit intended to “encourage as many kids as possible to participate in sports and — teach life lessons of teamwork.” Aon’s announcement tells us the group was “founded by a grant from the Aon Foundation.”
According to Aon’s proxy, which was filed on Wednesday, as part of Devine’s sendoff the company “agreed to recommend to Aon Foundation that it contribute $200,000 to a not-for-profit entity — established by Mr. Devine.” And since three Aon directors also sat on the foundation’s board as of the nonprofit’s 2008 tax return, we can’t imagine that was much of a problem.
What the initial press release didn’t mention, but the proxy does, is that Devine remains an Aon employee, and Aon is continuing to pay him through Nov. 18, 2010. He’s getting not only his base salary of $950,000 and the usual executive retirement benefits, but he also has a nice opportunity to collect another $750,000 from Aon in 2011. The condition? He has to work at least 20 hours a week at “the not-for-profit entity established by him.” In the meantime, restricted shares and restricted share-units will continue to vest while he remains an Aon employee, the company will provide him with secretarial assistance through the end of this year, and next year the company will pay the difference between his COBRA premiums and what he has been paying for health-care.
The deal was approved after the board
“considered Mr. Devine’s overall contributions to Aon during his four years of service and his commitment to develop a charitable organization to foster the link the between sports and the betterment of disadvantaged children, a mission Aon also supports through its Manchester United sponsorship—”
Given Manchester United’s rough image, we think Devine has something a little different in mind. We wish his new venture the best of luck, and surely Aon’s shareholders do as well. Hopefully, this will turn out a bit better than the other sports-related venture that Aon backed (and which was also disclosed in greater detail in the proxy): Chicago’s failed bid to attract the 2016 Olympics.
Image source: MRBECK via Flickr