LONDON (Breaking Views) - Few big US companies are as reflective of the personality of their leaders as American International Group is of its chairman and chief executive, Maurice 'Hank' Greenberg.

Greenberg is expected to step down as chief executive of AIG, the world's biggest insurer, later this week, according to a report in the Wall Street Journal.

Warren Buffett once remarked that despite AIG's increasing sprawl, Greenberg "knows when a sparrow falls, even when a sparrow is thinking of falling" at the company.

That has served shareholders over the past 45 years as the war veteran transformed a scrappy property and casualty insurer into one of the world's biggest financial groups today. But times have changed in the business - and Greenberg has not rolled with them.

Greenberg would remain as chairman of the company he joined in 1960. The move would come amid a steady drip of regulatory run-ins the insurer has had involving transactions that may have helped companies to massage their earnings and its involvement with troubles at Marsh, which settled with the New York State Attorney's Office over charges of bid-rigging last year.

AIG's board may name Martin Sullivan, a co-chief operating officer and vice chairman, to succeed Greenberg, 79, as chief executive, the WSJ said. A formal vote on the matter may come later Monday.

Industry practices that were once generally are no longer considered kosher. Part of this is simply a change in the ethical environment. Companies that cooked their books were the first to attract the ire of regulators and customers. The auditors and banks that assisted then were next in the firing line. It was only a matter of time before the insurers that helped corporate America fiddle its numbers had their comeuppance.

Thus AIG shareholders have been treated to a regular drip of disclosures about the insurer's role in helping companies massage their results. Meanwhile, Eliot Spitzer has unearthed evidence of bid-rigging at Marsh Maclennan that has undermined the credibility of the whole industry. That Marsh's chief executive was Greenberg's son only served to heighten the concerns of AIG's shareholders.

Greenberg's combative style has given the impression of a man unwilling to accept the changes blowing through the industry. Moreover, in addition to a startling lack of contrition, Greenberg refused to give shareholders a clear succession plan - no small omission when turning 80.

The board has cleverly seized on AIG's regulatory problems as a way to force the succession issue and he is expected to stand down as chief executive later this week, according to a report in the Wall Street Journal.

This will go some way to resolving AIG's issues, though it does not necessarily put an end to its apparent ethical difficulties. Meanwhile, Greenberg is likely to hang on to the chairmanship of AIG. And in that role he will still have every opportunity to size up the sparrows in the organization - and guide them to the worms.

Breakingviews is Europe's leading financial commentary and analysis service. Its team of financial journalists comments on the most important financial stories of the day, as they break.