Lloyd’s of London, the enormous insurance marketplace where Neal served as CEO until earlier this year, announced on Wednesday that it has been investigating his conduct since last month. The Wall Street Journal reported on the same day that AIG withdrew its offer to Neal after learning of the investigation, which focused on a relationship he allegedly had with a female employee at Lloyd’s.
It seems this was one office romance too many. It had already been made public that the board of Australian insurer QBE Insurance Group Ltd., where Neal previously served as CEO, docked his 2016 bonus by over A$550,000 ($354,000) after learning he had failed to disclose a relationship with a subordinate. Bloomberg had earlier reported that the woman in question had replaced Neal’s previous assistant—whom he later married.
AIG declined to comment, and Neal did not respond to messages seeking comment.
This quick reversal highlights the ongoing risks surrounding workplace relationships. Recent cases have caused CEOs at major companies such as Nestlé, Kohl’s, and Astronomer to lose their jobs. Notably, Andy Byron was caught on a “kiss cam” with the firm’s chief people officer during a Coldplay concert in July, which led to his resignation.
This also serves as a stark reminder of how even the world’s largest companies can be caught off-guard when it comes to high-stakes executive hires—especially those who have been heavily vetted, headhunted, and promised multimillion-dollar compensation packages.
“Workplace culture has become one of the biggest risk factors in the financial sector,” said Ian Hargreaves, partner at commercial disputes specialist Quillon Law.
Neal was set to receive a $17.2 million pay package at AIG, including a base salary of approximately $5 million in his first year, an additional $5 million in equity rewards, a $4.5 million restricted-stock grant with a three-year vesting period, and a $2.7 million cash bonus.
Insurance Career
Neal, 60, began his career in 1986 as a trainee commercial motor underwriter for Lloyd’s, according to a post on LinkedIn after he left the firm. He later managed Ensign, Lloyd’s specialist commercial motor underwriter, which was subsequently acquired by QBE. After around eight years with the Australian insurer, Neal’s focus on profitability led to his promotion to CEO.
However, under his leadership, QBE underperformed compared to its competitors in the Australian market. QBE’s share price delivered an annualized total return of just 1% during Neal’s tenure, compared to an average of about 21% from its peers.
Before leaving QBE, Neal admitted to failing to disclose a relationship with his personal assistant, resulting in the board reducing his bonus.
AIG’s CEO Hire Under Scrutiny
AIG’s sudden reversal raises questions about its hiring and vetting processes. Neal had been due to take on the responsibilities previously held by David McElroy, who resigned in April following criminal charges of sexual assault.