In the face of difficult conditions, Chicago-based Aon Corp.'s performance remains strong, with the company's brokerage business posting solid results while Aon makes considerable investments in its client service capabilities and the company's brand.

“When I looked at 2009 for Aon, I think all things considered it's been a pretty exceptional performance,” said Stephen P. McGill, chairman and CEO of Aon Risk Services, Aon's risk management and insurance brokerage business.

“In 2009 we achieved for the first time in our history a 20% margin in our brokerage business” despite “an incredibly difficult trading environment,” Mr. McGill said.

Aon posted $7.41 billion in brokerage revenues in 2009, up 1.5% from $7.30 billion in 2008, making the company the world's second-largest broker in Business Insurance's 2010 rankings.

Market and economic conditions have forced Aon to maintain the discipline it brought to operations in 2008 and 2009, Mr. McGill said. “But really the focus is around how we deliver value to our clients in a way that is distinctive, that enables us to be paid appropriately for the work we do, and how we make sure that we operate with our people in a way that's highly effective and also efficient.”

The company, he said, is “very much in investment mode,” a fact illustrated most recently as Aon announced plans last week to acquire Lincolnshire, Ill.-based human resources consultant Hewitt Associates Inc. for $4.9 billion in cash and stock.

Aon plans to operate the new unit as Aon Hewitt under the direction of Russ Fradin, Hewitt's chairman and CEO. The move will expand Aon's consulting capabilities, particularly with clients dealing with employee benefits and health care reform issues.

In a statement affirming Aon's ratings but changing its rating outlook to negative from stable due to the amount of debt in Hewitt transaction and the execution risks associated with so large a deal, Bruce Ballentine, a vp at Moody's Investors Service and the rating agency's lead analyst for Aon, noted that the deal “would sharply expand Aon's capabilities in human resource consulting and outsourcing.”

The deal also “would give the company a more balanced mix of insurance brokerage and consulting revenues,” the Moody's analyst said.

Aon has taken a strategic approach to acquisitions.

Other key recent acquisitions include New York-based Carpenter Moore Insurance Services Inc. in October, which “gave us tremendous expertise in financial services” and directors and officers liability, Mr. McGill said, and Jericho, N.Y.-based Allied North America in December, which “reinforced our leadership position in the construction sector.”

Also in December, Aon acquired Madrid-based FCC Global Insurance Services, the in-house broker “of a Spanish conglomerate heavily involved in construction,” Mr. McGill said.

In March, Aon bought Chicago-based J.P. Morgan Compensation & Benefit Strategies, a division of JPMorgan Chase & Co.

“We're very selective where it's going to add real capability,” Mr. McGill said. “Also, we're very interested in looking to the future in building out acquisitions in the emerging markets where there are significant growth opportunities.”

Aon continues to roll out its Aon Client Promise, a 10-point value proposition “designed by clients for clients,” Mr. McGill said. “It's being embedded in the DNA of the firm and it's all about raising the standard of client excellence as Aon works with its clients around the world,” he said.

The success of the Aon Client Promise led the broker to develop a similar document to guide its work with insurers, the Aon Carrier Charter, a 10-point framework aimed at raising broking and underwriting standards as Aon serves its clients.

The broker continues to roll out its Global Risk Insight Platform, a real-time broking and information platform that provides information about insurance placements by industry, geography and local insurance market.

To date, some $32.5 billion in premium and 500,000 trades have been placed in GRIP.

“It is the world's largest proprietary database of insurance placement data,” Mr. McGill said. “It reinforces our commitment to having fact-based insights that can help us better serve our clients.”

GRIP has been winning industry recognition, including an Innovation Award from Business Insurance this year.

On June 1, what Mr. McGill described as Aon's most significant brand investment ever—the company's sponsorship of the Manchester United soccer team, for which Aon paid a reported $131.2 million—took effect. “We haven't even really started realizing the full potential of what this is going to do for Aon's brand recognition around the world,” he said.

Aon suffered a personal loss in May with the death of Bernard S.Y. Fung, chairman and chief executive of Aon's Asia/Pacific business.

“We were very saddened with the recent loss of Bernie Fung,” Mr. McGill said. “Very fortunately, Bernie had put in place a succession plan which resulted in a new senior leader joining the firm at the beginning of this year.” That executive, Sandeep Malik, was appointed CEO of Asia Aon Risk Services, joining Aon from Prudential Asia.

Another significant personnel move was Andrew Appel moving into the role of chief operating officer of Aon Corp., while retaining his role as chairman of Aon Consulting.

Looking forward, Mr. McGill sees considerable opportunity for Aon.

“When we look out across the world and we look at the profile of risk increasing, the demands on our business will increase, particularly as the economies start recovering,” Mr. McGill said. “And I believe that there's going to be greater demand for consulting services, risk consulting, risk engineering, crisis management, (enterprise risk management), a whole broad spectrum of services which we have within Aon.”

Aon's stock closed at $38.34 on July 9, with a 52-week high of $44.34 and a 52-week low of $36.32.