(Rule 14a-101)


                            SCHEDULE 14A INFORMATION

                Proxy Statement Pursuant to Section 14(a) of the
               Securities Exchange Act of 1934 (Amendment No.   )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:

[X] Preliminary Proxy Statement      [_] Soliciting Material Under Rule 14a-12
[_] Confidential, For Use of the
    Commission Only (as permitted
    by Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials

                        Marsh & McLennan Companies, Inc.
                (Name of Registrant as Specified In Its Charter)

    (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (check the appropriate box):

[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1)  Title of each class of securities to which transaction applies:

2)  Aggregate number of securities to which transaction applies:

3)  Per unit price or other underlying value of transaction computed pursuant
    to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
    calculated and state how it was determined):

4)  Proposed maximum aggregate value of transaction:

5)  Total fee paid:

[_] Fee paid previously with preliminary materials:


[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
    0-11(a)(2) and identify the filing for which the offsetting fee was paid
    previously. Identify the previous filing by registration statement number,
    or the form or schedule and the date of its filing.

    1)  Amount previously paid:

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    4)  Date Filed:



Marsh o Putnam o Mercer
Marsh & McLennan Companies

                                   Notice of Annual Meeting
                                   And Proxy Statement


Marsh o Putnam o Mercer
Marsh & McLennan Companies

Dear MMC Stockholder:

You are cordially invited to attend our annual stockholders meeting. The meeting
will be held at 10:00 a.m. on Thursday,  May 15, 2003 in the  auditorium  on the
second floor at 1221 Avenue of the Americas, New York, New York.

In addition to the matters  described in the attached proxy  statement,  we will
report on our Company's  activities during 2002. You will have an opportunity to
ask questions and to meet your directors and executives.

Whether you plan to come to the annual meeting or not, your  representation  and
vote are important, and your shares should be voted. Please complete, sign, date
and return the enclosed proxy card promptly. You also may vote by telephone,  or
electronically  over the Internet,  by following the  instructions on your proxy

We look forward to seeing you at the meeting. Your vote is important to us.

                                   Very truly yours,

                                   /s/ Jeffrey W. Greenberg

                                   Jeffrey W. Greenberg

March 27, 2003

                        MARSH & McLENNAN COMPANIES, INC.
                           1166 AVENUE OF THE AMERICAS
                          NEW YORK, NEW YORK 10036-2774

                                 PROXY STATEMENT


             10:00 a.m. Local Time


             May 15, 2003


             Second Floor Auditorium
             1221 Avenue of the Americas
             New York, New York


          1.   To elect five persons to serve as Class III directors, each for a
               three-year term;

          2.   To adopt an amendment to MMC's Restated Certificate of
               Incorporation increasing the number of authorized shares of
               common stock;

          3.   To ratify the appointment of Deloitte & Touche LLP as independent
               auditors; and

          4.   To conduct any other business that may properly come before the

     This notice and proxy  statement  describes  the matters being voted on and
contains  other  information  that may be helpful to you. In this  material,  we
refer to Marsh & McLennan Companies, Inc. as "MMC", the "Company", "we" or "us".

     Only  stockholders  of  record  on March  19,  2003 may vote at the  annual
meeting.  You will need proof of  ownership  of MMC stock to enter the  meeting.
This proxy  solicitation  material is being mailed to  stockholders  on or about
March 27, 2003 with a copy of MMC's 2002 Annual Report, which includes financial
statements for the period ended December 31, 2002.




MARCH 27, 2003

                                TABLE OF CONTENTS

ITEM 1: ELECTION OF DIRECTORS...................................................................5
         Nominees for Election as Directors for a Three-Year Term Expiring in 2006..............5
         Directors Continuing in Office-Term Expiring in 2004...................................6
         Directors Continuing in Office-Term Expiring in 2005...................................8
INFORMATION REGARDING THE BOARD OF DIRECTORS...................................................10
         Code of Ethics........................................................................11
         Directors' Compensation...............................................................11
COMPENSATION OF EXECUTIVE OFFICERS.............................................................14
         Summary Compensation Table............................................................14
         Option Grants in 2002.................................................................17
         Aggregated Option Exercises in 2002 & Year-End Option Values..........................18
         United States Retirement Program......................................................19
         Employment Agreement..................................................................19
         Compensation Committee Report.........................................................21
         Stock Performance Graph...............................................................24
ITEM 3: RATIFICATION OF SELECTION OF AUDITORS..................................................27
         Fees of Independent Auditors..........................................................27
AUDIT COMMITTEE REPORT.........................................................................28
SUBMISSION OF FUTURE STOCKHOLDER PROPOSALS.....................................................29




     Holders of our common stock, as recorded in our stock register on March 19,
2003, may vote at the meeting.  As of that date, there were [__________]  shares
of common  stock  outstanding  and  entitled  to one vote per  share.  A list of
stockholders will be available for inspection for at least ten days prior to the
meeting  at  the  principal  executive  offices  of MMC at  1166  Avenue  of the
Americas, New York, New York.


     You may vote in person at the meeting or by proxy. We recommend you vote by
proxy even if you plan to attend the meeting. You can always change your vote at
the meeting.

     Most  stockholders  have a choice  of  proxy  voting  by using a toll  free
telephone number,  through the Internet or by completing the enclosed proxy card
and mailing it in the postage-paid envelope provided. Please refer to your proxy
card or the information forwarded by your bank, broker or other holder of record
to see which options are available to you.

     Executors,   administrators,   trustees,  guardians,  attorneys  and  other
representatives  voting on behalf of a stockholder  should indicate the capacity
in which they are signing and corporations  should sign by an authorized officer
whose title should be indicated.


     MMC's Board of  Directors  is asking for your  proxy.  Giving us your proxy
means you authorize us to vote your shares at the meeting, or at any adjournment
thereof,  in the manner you direct.  You may vote for all,  some, or none of our
director  nominees.  You may also vote for or  against  the other  proposals  or
abstain from voting.

     If you sign and return the  enclosed  proxy card but do not  specify how to
vote, we will vote your shares in favor of our director nominees and in favor of
Items 2 and 3.

     As of the date hereof,  we do not know of any other  business  that will be
presented at the  meeting.  If other  business  shall  properly  come before the
meeting,  including any proposal  submitted by a  stockholder  which was omitted
from this Proxy Statement in accordance with applicable federal securities laws,
the persons named in the proxy will vote according to their best judgment.


     You may revoke your proxy before it is voted by submitting a new proxy with
a later  date,  by  voting  in  person at the  meeting,  or by  sending  written
notification addressed to:

     Marsh & McLennan Companies, Inc.
     1166 Avenue of the Americas
     New York, New York 10036-2774
     Attn: Mr. Gregory Van Gundy,
           Corporate Secretary

     Mere  attendance at the meeting will not revoke a proxy that was previously
submitted to MMC.


     In order to carry on the  business of the  meeting,  we must have a quorum.
This means at least a majority of the  outstanding  shares eligible to vote must
be represented at the meeting, either by proxy or in person.

     The Chairman has broad  authority to conduct the annual meeting so that the
business of the meeting is carried out in an orderly and timely manner. In doing
so,  the  Chairman  has  broad  discretion  to  establish  reasonable  rules for
discussion,  comments and  questions  during the meeting.  The Chairman  also is
entitled to rely upon applicable law regarding disruptions or disorderly conduct
to  ensure  that  the  meeting  is  conducted  in a  manner  that is fair to all


     Only  stockholders,  their proxy  holders,  and MMC's guests may attend the
meeting.  Admission to the meeting will be on a first-come,  first-served basis.
Verification of ownership may be required at the admissions desk. If your shares
are held in the name of your broker,  bank, or other nominee,  you must bring to
the meeting an account statement or letter from the nominee  indicating that you
are the  beneficial  owner of the shares on March 19, 2003,  the record date for



     Directors are elected by a plurality of the votes cast.  "Plurality"  means
that the  individuals  who  receive  the  largest  number of votes  cast FOR are
elected as directors  up to the maximum  number of directors to be chosen at the
meeting.  Votes  withheld from any director  nominee will not be counted in such
nominee's favor.

     Adoption of the proposal to amend the Restated Certificate of Incorporation
requires the affirmative  vote of a majority of the outstanding  shares of MMC's
stock.  Accordingly,  abstentions  and broker nonvotes will have the effect of a
negative vote on the proposal.

     All other  matters to be acted on at the meeting  require  the  affirmative
vote of a  majority  of the  shares  of MMC stock  present  or  represented  and
entitled to vote at the meeting to constitute the action of the stockholders. In
accordance  with  Delaware  law,  abstentions  will be treated  as  present  and
entitled to vote for purposes of the preceding  sentence,  while broker nonvotes
will not.

     A "broker  nonvote"  is a proxy  submitted  by a broker in which the broker
fails  to  vote on  behalf  of a  client  on a  particular  matter  for  lack of
instruction when such instruction is required by the rules of the New York Stock
Exchange.  Broker  nonvotes  will be counted  for  purposes of  determining  the
presence of a quorum for the transaction of business.


     This  proxy  statement  and the 2002  Annual  Report  can be  viewed on our
website at  Most stockholders can elect to
view future proxy  statements  and annual  reports over the Internet  instead of
receiving paper copies in the mail.

     If you are a stockholder of record, you can choose this option and save MMC
the cost of producing and mailing these documents by following the  instructions
provided when you vote over the  Internet.  If you hold your MMC stock through a
bank, broker or other holder of record, please refer to the information provided
by that  entity  for  instructions  on how to  elect to view  our  future  proxy
statements and annual reports over the Internet.

     If you choose to view our future proxy  statements  and annual reports over
the Internet,  you will receive an e-mail  message with  instructions  on how to
access MMC's proxy statement and annual report and vote. Your choice will remain
in effect until you tell us otherwise.  You do not have to elect Internet access
each year.  To view,  cancel or change  your  enrollment  profile,  please go to


     In  addition  to  this  mailing,   proxies  may  be  solicited  personally,
electronically  or by  telephone.  We pay the  expenses of  preparing  the proxy
materials  and  soliciting  this  proxy.  We also  reimburse  brokers  and other
nominees for their expenses in sending these materials to you and obtaining your
voting instructions.

     We have retained Georgeson Shareholder Communications Inc. to assist in the
proxy solicitation at a fee of approximately $10,000, plus expenses. In addition
to  solicitation  of proxies by mail,  proxies may be solicited  personally,  by
telephone,  e-mail  and by  facsimile  by MMC's  directors,  officers  and other
employees,  who will receive no additional  compensation for these  solicitation


     If you and other  residents at your mailing address with the same last name
own shares of common  stock  through a bank,  broker or other  holder of record,
your bank or broker may have sent you a notice that your  household will receive
only one annual  report and proxy  statement  for each company in which you hold
stock  through  that bank or broker.  This  practice of sending only one copy of
proxy   materials  to  holders   residing  at  a  single  address  is  known  as
"householding", and is designed to reduce printing and postage costs.

     If  you  did  not  respond  that  you  did  not  want  to   participate  in
householding,  you were deemed to have consented to the process.  If you did not
receive a householding  notice from your bank, broker or other holder of record,
you can request  householding  by  contacting  that entity.  You may revoke your
consent to householding at any time by calling 1-800-542-1061.

     If you wish to receive a separate annual report or proxy statement, you may
telephone Corporate Development at (212) 345-5475 or write to:

     Marsh & McLennan Companies, Inc.
     1166 Avenue of the Americas
     New York, New York 10036-2774.
     Attn: Corporate Development


                              ELECTION OF DIRECTORS

     Our Board of Directors is divided into three classes. Members of each class
serve for a three-year term.  Stockholders  elect one class of directors at each
annual meeting.  At this annual meeting,  stockholders will vote on the election
of the five nominees described below.

     The following  section  contains  information  provided by the nominees and
continuing directors about their principal  occupation,  business experience and
other matters.  The nominees are all current  directors of MMC, and each nominee
has indicated to MMC that he or she will serve if elected.  Mr. John T. Sinnott,
Chairman of Marsh Inc., a subsidiary  of MMC, and a director,  is retiring  from
MMC in July 2003 and not standing for election.  We do not  anticipate  that any
nominee will be unable or unwilling to stand for election,  but if that happens,
your proxy may be voted for another person nominated by the Board.

     The Board  proposes the election of the nominees  listed below as directors
for a term ending at the 2006 Annual Meeting.

     The  Board of  Directors  recommends  a vote FOR the  election  of all five

                     FOR A THREE-YEAR TERM EXPIRING IN 2006

               PETER COSTER                                  DIRECTOR SINCE 1988

[PHOTO]        Mr. Coster,  age 63, is President and Chief Executive  Officer of
               Mercer Inc., a subsidiary  of MMC. He joined  Mercer in 1984 upon
               its  acquisition  of a U.K.  consulting  firm that Mr. Coster had
               joined  in  1962.  He is a  trustee  of The  Foundation  Fighting

               CHARLES A. DAVIS                              DIRECTOR SINCE 2000

[PHOTO]        Mr. Davis, age 54, is Vice Chairman of MMC and Chairman and Chief
               Executive Officer of MMC Capital, Inc., an indirect subsidiary of
               MMC.  He became  Vice  Chairman  of MMC in 1999 and has served as
               Chief  Executive  Officer  of MMC  Capital  since 1999 and as its
               Chairman  since  2002.  He served  as  President  of MMC  Capital
               beginning in 1998 before becoming Chairman. Prior to joining MMC,
               in a 23-year  career at  Goldman,  Sachs & Co.  he held  numerous
               positions,   including  head  of  investment   banking   services
               worldwide.  Mr.  Davis  is a  director  of Media  General,  Inc.,
               Progressive Corporation and Merchants Bancshares, Inc.


               GWENDOLYN S. KING** ****                      DIRECTOR SINCE 1998

[PHOTO]        Ms. King,  age 62, is  President  of Podium Prose in  Washington,
               D.C. She was Senior Vice President,  Corporate and Public Affairs
               at Peco  Energy  from 1992  until  1998.  From 1989 to 1992,  she
               served as Commissioner of the Social Security  Administration  in
               the U.S.  Department of Health and Human  Services.  In 2001, Ms.
               King was appointed by President George W. Bush to the President's
               Commission to Strengthen Social Security.  Ms. King is a director
               of   Countrywide   Financial    Corporation,    Lockheed   Martin
               Corporation,  Monsanto  Company,  Pharmacia  Corporation  and the
               National  Association of Corporate  Directors and a member of the
               George Washington University Council on American Politics.

               LAWRENCE J. LASSER                            DIRECTOR SINCE 1987

[PHOTO]        Mr. Lasser,  age 60, is President and Chief Executive  Officer of
               Putnam Investments, LLC, a subsidiary of MMC. He joined Putnam in
               1969. Mr. Lasser is a trustee of  approximately  100 mutual funds
               managed by Putnam Investment  Management,  LLC. He is a member of
               the  Executive  Committee  of  the  Board  of  Governors  of  the
               Investment  Company  Institute,  a trustee  of the Museum of Fine
               Arts,  Boston,  and a member of the Boards of  Directors  of Beth
               Israel/Deaconess  Medical Center,  Boston,  and the United Way of
               Massachusetts  Bay. He is also a member of the CareGroup Board of
               Managers Investment  Committee,  the Council on Foreign Relations
               and the Commercial Club of Boston.

               DAVID A. OLSEN**                              DIRECTOR SINCE 1997

[PHOTO]        Mr. Olsen,  age 65, is a director of U.S. Trust  Corporation,  an
               honorary director of New York's South Street Seaport Museum and a
               trustee of Bowdoin  College.  He was Chairman and Chief Executive
               Officer of Johnson & Higgins  prior to its  business  combination
               with MMC in 1997.  Mr. Olsen joined Johnson & Higgins in 1966. He
               served as Vice Chairman of MMC from May 1997 until December 1997.

                         DIRECTORS CONTINUING IN OFFICE
                             (TERM EXPIRING IN 2004)

               LEWIS W. BERNARD* ***                         DIRECTOR SINCE 1992

[PHOTO]        Mr. Bernard, age 61, is Chairman of Classroom, Inc., a non-profit
               educational  corporation.  He retired in 1991 from Morgan Stanley
               &Co., Inc., where for almost 30 years he held numerous positions,
               including that of Chief Administrative and Financial Officer. Mr.
               Bernard  is  Chairman  of the  Board of the  American  Museum  of
               Natural  History,  Vice Chairman of the J. Paul Getty Trust and a
               trustee of The Andrew W. Mellon Foundation.


               MATHIS CABIALLAVETTA                          DIRECTOR SINCE 2000

[PHOTO]        Mr. Cabiallavetta,  age 58, is Vice Chairman of MMC and Chairman,
               MMC Global Development.  He joined MMC in 1999.  Prior thereto he
               was  Chairman of the Board of UBS A.G. He is a past member of the
               board of the Swiss  National Bank and the  International  Capital
               Markets  Advisory  Committee of the Federal Reserve Bank. He also
               served as a Vice  Chairman of the Board of Directors of the Swiss
               Bankers  Association.  He is a director of Altria Group, Inc. and
               HBM BioVentures AG in Switzerland.

               ROBERT F. ERBURU*** ****                      DIRECTOR SINCE 1996

[PHOTO]        Mr.  Erburu,  age 72, is  Chairman  of the Board of the  National
               Gallery of Art, the Pacific Council on  International  Policy and
               the Board of  Councilors  of the  College  of  Letters,  Arts and
               Science of the University of Southern  California.  He retired as
               Chairman of the Board of The Times  Mirror  Company on January 1,
               1996,  a  position  he had held  since  1986.  He served as Chief
               Executive  Officer of The Times Mirror Company from 1981 to 1995.
               Mr. Erburu is also Chairman  Emeritus of the  Huntington  Library
               and the J. Paul  Getty  Trust and a trustee  of The  William  and
               Flora Hewlett Foundation,  the Ahmanson Foundation,  the Ralph M.
               Parson  Foundation,  the Fletcher Jones Foundation and the Carrie
               Estelle Doheny Foundation.

               OSCAR FANJUL**                                DIRECTOR SINCE 2001

[PHOTO]        Mr. Fanjul,  age 53, is Vice Chairman and Chief Executive Officer
               of Omega  Capital,  a private  investment  firm in Spain.  He was
               Chairman   of  N.H.   Hotels   from  1997   until   1999  and  of
               Hidroelectrica  del  Cantabrico  from 1999 to 2001. Mr. Fanjul is
               Honorary  Chairman of Repsol,  S.A.,  where from its  creation in
               1986 until 1996 he was Chairman and Chief Executive Officer.  Mr.
               Fanjul is a  director  of  Acerinox,  Tecnicas  Reunidas  and the
               London Stock Exchange and an advisory director of Unilever. He is
               also a member of the  International  Advisory Board of MMC and of
               The Chubb  Corporation and of the European  Advisory Board of the
               Carlyle Group.  He is also an  International  Advisor to Goldman,
               Sachs & Co.

               RAY J. GROVES                                 DIRECTOR SINCE 1994

[PHOTO]        Mr. Groves,  age 67, is President and Chief Executive  Officer of
               Marsh Inc., a subsidiary of MMC. He joined MMC as Senior  Advisor
               in August 2001,  became President and Chief Operating  Officer of
               Marsh in  October  2001 and Chief  Executive  Officer  in January
               2003.  Prior  to  joining  MMC,  he was  Chairman  of Legg  Mason
               Merchant Banking, Inc., a position he held since 1995. Mr. Groves
               retired  in 1994  from  Ernst &  Young,  where  he held  numerous
               positions  for 37 years,  including the last 17 years as Chairman
               and  Chief  Executive  Officer.   He  is  a  director  of  Boston
               Scientific  Corporation,  Electronic Data Systems Corporation and
               The  Gillette  Company.  He  is  also  a  managing  director  and
               Treasurer and Secretary of the Metropolitan Opera Association and
               a director  and  former  Chairman  of The Ohio  State  University


                         DIRECTORS CONTINUING IN OFFICE
                             (TERM EXPIRING IN 2005)

               JEFFREY W. GREENBERG*                         DIRECTOR SINCE 1996

[PHOTO]        Mr.  Greenberg,  age 51,  is  Chairman  of the  Board  and  Chief
               Executive  Officer of MMC.  He has been Chief  Executive  Officer
               since 1999 and Chairman since 2000. Mr. Greenberg was Chairman of
               MMC  Capital  from 1996 until  2002.  He joined MMC in 1995.  Mr.
               Greenberg is on the board of The Brookings Institution, a trustee
               of Brown  University,  the Spence School in New York City and New
               York-Presbyterian Hospital and a member of the Board of Overseers
               of the Joan and  Sanford  I.  Weill  Graduate  School of  Medical
               Sciences of Cornell University.  He is a member of the Council on
               Foreign Relations and The Trilateral Commission.

               STEPHEN R. HARDIS* **                         DIRECTOR SINCE 1998

[PHOTO]        Mr. Hardis, age 67, is Chairman of Axcelis Technologies,  Inc. He
               was Chairman  and Chief  Executive  Officer of Eaton  Corporation
               prior to his  retirement in 2000. He joined Eaton  Corporation in
               1979. Mr. Hardis is a director of American Greetings Corporation,
               Apogent  Technologies  Inc., Lexmark  International  Corporation,
               Nordson   Corporation,   Progressive   Corporation   and   Steris
               Corporation  and a  trustee  of  the  Cleveland  Clinic  and  the
               Cleveland Orchestra.

               THE RT. HON. LORD LANG OF MONKTON, DL* *** ****
                                                             DIRECTOR SINCE 1997

[PHOTO]        Lord Lang,  age 62, is chairman  of BFS US Special  Opportunities
               Trust  plc,  Murray  tmt plc,  Thistle  Mining  Inc.  and  Second
               Scottish  National  Trust  plc.  He was a member  of the  British
               Parliament from 1979 to 1997, serving in the Cabinet as Secretary
               of State  for  Scotland  (1990 to 1995) and as  President  of the
               Board of Trade and  Secretary  of State  for  Trade and  Industry
               (1995 to 1997).  Lord Lang is also Chairman of the Patrons of the
               National  Galleries of Scotland  and a Governor of Rugby  School,

               MORTON O. SCHAPIRO**                          DIRECTOR SINCE 2002

[PHOTO]        Mr.  Schapiro,  age 49,  is  President  of  Williams  College,  a
               position he assumed in 2000. From 1994 until 2000, he was Dean of
               the College of Letters,  Arts and Sciences at the  University  of
               Southern California,  and from 1999 to 2000 he also served as the
               University's  vice  president  for  planning.  Mr.  Schapiro is a
               trustee  of The WM Group of Funds,  a  management  subsidiary  of
               Washington  Mutual Bank. He is also a trustee of the Williamstown
               Theater Festival and the Sterling & Francine Clark Art Institute.


               ADELE  SIMMONS* **                          DIRECTOR  SINCE  1978

[PHOTO]        Mrs. Simmons,  age 61, is Vice Chair of Chicago  Metropolis 2020,
               President  of the Global  Philanthropy  Partnership  and a senior
               associate  of  the  Center  for  International   Studies  at  the
               University  of  Chicago.  She was  President  of the  John D. and
               Catherine T.  MacArthur  Foundation  from 1989 to 1999.  She is a
               director of The Field  Museum,  Environmental  Defense,  Synergos
               Institute,  the Rocky  Mountain  Institute,  the Global  Fund for
               Women,  the  Union  of  Concerned  Scientists  and  the  American
               Prospect.  She is Chair of the  Committee  to Visit the  Graduate
               School  of  Education  at  Harvard  University,  a member  of the
               Advisory  Board of the World Bank  Institute and a senior advisor
               to The World Economic Forum.

               A. J. C. SMITH*                               DIRECTOR SINCE 1977

[PHOTO]        Mr.  Smith,  age 68,  retired in 2000 as Chairman of the Board of
               MMC,  a  position  he held  since  1992.  He was Chief  Executive
               Officer  of MMC from  1992 to 1999.  Mr.  Smith is a  trustee  of
               approximately  100  mutual  funds  managed  by Putnam  Investment
               Management,  LLC. He is Chairman of the Central Park  Conservancy
               and a trustee of the Carnegie Hall Society, Inc., the Educational
               Broadcasting  Corporation  in New  York  City  and  the  National
               Museums of Scotland  (Edinburgh).  Mr.  Smith is also a member of
               the Board of Overseers of the Joan and Sanford I. Weill  Graduate
               School of Medical Sciences of Cornell University.

*      Member of the Executive Committee, of which Mr. Greenberg is Chair.
**     Member of the Audit Committee, of which Mr. Hardis is Chair.
***    Member of the Compensation Committee, of which Mr. Bernard is Chair.
****   Member of the Directors and Governance Committee, of which Mr. Erburu is



     MMC is a global professional services company. Our business is conducted by
our business units, and their employees and officers, under the direction of the
chief executive officer and the oversight of the Board, to enhance the long-term
value of MMC for its stockholders.  The Board of Directors,  which is elected by
the  stockholders,  is the  ultimate  decision-making  body of MMC  except  with
respect to those  matters  reserved  to the  stockholders.  The Board held seven
meetings during 2002.

     Our Board  includes a balance of  non-executive  and  executive  directors.
Independent  non-executive directors constitute a majority of our Board and meet
the independence  requirements proposed by the NYSE in 2002. With respect to our

     o    a meaningful  portion of the compensation for non-executive  directors
          is paid in MMC stock;

     o    all new directors  participate  in an  orientation.  This  orientation
          includes  background material and presentations by management on MMC's
          operations and strategic plans,  its financial  statements and its key
          policies and practices;

     o    board members have complete  access to MMC's  officers and  employees.
          Directors  are  encouraged  to  communicate  directly with MMC's chief
          financial  officer,  general  counsel  and  other  members  of  senior
          management; and

     o    in addition to access to MMC  officers,  the Board and its  committees
          have the  authority  to obtain  advice and  assistance  from  external
          advisors or consultants as they may deem necessary.


     Our Board has established an Executive  Committee,  an Audit  Committee,  a
Compensation  Committee and a Directors and  Governance  Committee to assist the
Board in discharging  its  responsibilities.  New charters for the  Compensation
Committee,  and the Directors and Governance Committee established in 2002, have
been  adopted  by the Board of  Directors  and can be viewed on our  website  at  Membership on the Audit, Compensation,  and Directors
and  Governance  Committee is limited to  independent  non-executive  directors.
Following  each  meeting of its  committee,  each  committee  chair  reports the
highlights of the meeting to the full Board.


     o    is  empowered  to act for the full Board in  intervals  between  Board
          meetings,  with the exception of certain  matters that under  Delaware
          law or MMC's by-laws may not be delegated; and

     o    meets as necessary,  with all actions taken by the committee  reported
          at the next Board of Directors meeting.

     The Executive Committee held three meetings during 2002.


     The Audit Committee has oversight responsibility with respect to:

     o    the annual  financial  information to be provided to stockholders  and
          the Securities and Exchange Commission ("SEC");

     o    the system of internal controls that management has established; and

     o    the internal and external audit process.

     All  members of the Audit  Committee  are  independent  as  required by the
listing  standards of the New York Stock  Exchange.  The Board of Directors  has
determined that Stephen R. Hardis, an independent non-executive director and the
chair of the Audit Committee,  has the requisite  qualifications  to satisfy the
SEC definition of Audit Committee Financial Expert.

     The Audit Committee held nine meetings during 2002.


     o    evaluates the  performance  and determines the  compensation  of MMC's
          Chief Executive Officer;

     o    reviews and approves the compensation of other senior executives; and

     o    makes   recommendations   to  the  Board  with  respect  to  incentive
          compensation   plans  and   equity-based   plans  and  discharges  the
          responsibilities of the committee set forth in MMC's plans.

     The Compensation Committee held nine meetings during 2002.


     o    develops,   reviews  and   periodically   reassesses  MMC's  corporate
          governance principles and recommends proposed changes to the Board;


     o    identifies, considers and recommends qualified candidates to the Board
          for election as directors,  including the slate of directors  that the
          Board proposes for election at the annual meeting;

     o    in  consultation  with the MMC  chairman and other  committee  chairs,
          recommends committee assignments to the Board; and

     o    develops  processes for and oversees annual assessments of the Board's
          performance and effectiveness.

     The  Directors  and  Governance   Committee   considers  director  nominees
recommended  by  our   stockholders.   Stockholders  may  propose  nominees  for
consideration by submitting the names and supporting information to:

     Marsh & McLennan Companies, Inc.
     1166 Avenue of the Americas
     New York, New York 10036-2774
     Attn: Directors & Governance Committee,
           c/o Mr. Gregory Van Gundy,
           Corporate Secretary

     The Directors and Governance Committee held two meetings in 2002.


     The average attendance by directors at meetings of the Board and committees
thereof was 98%.  All  directors  attended  at least 75% of the  meetings of the
Board and committees on which they served.


     In addition to its code of business conduct applicable to all employees and
directors,  MMC has adopted a Code of Ethics, as provided by the  Sarbanes-Oxley
Act of 2002,  which  applies to its chief  executive  officer,  chief  financial
officer and controller. A copy of that Code is filed as an exhibit to MMC's 2002
Annual Report on Form 10-K.


     Non-executive  directors  retire at the annual meeting after  attaining age
72, unless the person has been a non-executive director for less than ten years.
In such cases,  non-executive  directors retire at the annual meeting  following
the earlier of ten years of service or  attaining  age 75.  Executive  directors
other  than the  chief  executive  officer  resign  from the  Board  upon  their
retirement.  Currently  the former  MMC chief  executive  officer  serves on the


     As compensation for their services,  we paid the following  compensation to
our non-executive  directors,  Messrs.  Bernard,  Erburu,  Fanjul, Hardis, Lang,
Olsen, Schapiro and Smith, Ms. King and Mrs. Simmons:

     o    a basic  retainer  of  $40,000  per year and an annual  grant of 1,800
          shares of stock (the "Annual Stock Grant");

     o    a fee of $1,000 and reimbursement of related expenses for each meeting
          of the board or a committee they attend;

     o    an  additional  retainer  of  $5,000  per  year to the  chair  of each
          committee  (other  than  Mr.  Greenberg  as  chair  of  the  Executive
          Committee); and

     o    an  additional  retainer  of  $2,000  per  year to  other  members  of

     We also offer travel accident insurance benefits to non-executive directors
in connection with  MMC-related  business  travel.  Non-executive  directors are
included  in  MMC's  gift-matching  program  for  certain  charitable  gifts  by
employees up to a maximum of $5,000 per year.

     Directors who are also employees receive no specific compensation for their
services as directors.

     Under the terms of MMC's Directors Stock  Compensation  Plan, the directors
receive twenty-five percent of the basic retainer in shares of stock at the fair
market  value  thereof,  as well as their Annual Stock Grant on each June 1. The
balance  of  their  compensation   (including   attendance  fees  and  committee
retainers) is paid in either  shares of stock or cash,  as the director  elects.
The directors may defer receipt of all or a portion of their  compensation to be
paid in shares until the year following  either their  retirement from the Board
or a specified earlier date.

     Certain  directors  are  investors  in a fund that is a limited  partner of
Trident II, L.P.  ("Trident  II"), a $1.4 billion private equity fund managed by
MMC Capital,  Inc., an indirect subsidiary of MMC. Neither the directors nor the
fund are required to pay


management  or  carried  interest  performance  fees in  connection  with  their
investments in Trident II.

     Since June 1, 2000, MMC has had an agreement with A.J.C. Smith, pursuant to
which Mr. Smith provides certain  advisory and consultative  services for MMC or
its affiliates,  serves as chairman of MMC's International Advisory Board and is
a trustee of  various  Putnam  Funds.  He also  serves as a director  of Marsh &
McLennan Risk Capital  Holdings,  Ltd. and MMC Capital.  For these  services MMC
pays Mr. Smith  $1,250,000 per year and provides  support and other services and
business expense  reimbursement.  On May 16, 2002 the term of this agreement was
extended through May 31, 2003. For services rendered in 2002, Mr. Smith received
an additional $1,250,000 incentive payment.

     Mr. Fanjul serves on MMC's  International  Advisory Board and is a director
of  Marsh,  S.A.,  a Spanish  subsidiary  of MMC,  but  receives  no  additional
compensation for such service.


     The following  table  reflects as of February 28, 2003 (except with respect
to interests in MMC's Stock  Investment Plan and Stock  Investment  Supplemental
Plan,  which are as of  December  31,  2002) the  number of shares of our common
stock which each  director  and each named  executive  officer  has  reported as
owning  beneficially or otherwise having a pecuniary  interest in, and which all
directors and executive officers of MMC have reported as owning  beneficially as
a group.  It also includes the number of shares of stock  beneficially  owned by
persons known to MMC to own more than 5% of the outstanding shares.

                                                                    AMOUNT AND NATURE OF
                                                                  BENEFICIAL OWNERSHIP (1)
                                                          SOLE VOTING    OTHER THAN
                                                              AND        SOLE VOTING
                                                          INVESTMENT   AND INVESTMENT
NAME                                                         POWER        POWER (2)       TOTAL
----                                                      -----------  --------------   ---------
Lewis W. Bernard ........................................      6,000         55,301        61,301
Mathis Cabiallavetta ....................................     11,804        508,118       519,922
Peter Coster ............................................     46,014      1,014,051     1,060,065
Charles A. Davis ........................................     26,398        705,006       731,404
Robert F. Erburu ........................................         --         38,582        38,582
Oscar Fanjul ............................................     13,393             --        13,393
Jeffrey W. Greenberg ....................................    116,684      1,838,257     1,954,941
Ray J. Groves ...........................................      7,848        189,632       197,480
Stephen R. Hardis .......................................      2,000         13,352        15,352
Gwendolyn S. King .......................................         --          9,852         9,852
Lord Lang ...............................................      5,258          2,800         8,058
Lawrence J. Lasser ......................................         --        798,150       798,150
David A. Olsen ..........................................    428,678        213,154       641,832
Morton O. Schapiro ......................................         --          2,063         2,063
Adele Simmons ...........................................    233,214        184,750       417,964
John T. Sinnott .........................................    101,584        992,764     1,094,347
A.J.C. Smith ............................................  1,099,478      2,145,154     3,244,632
All directors and executive officers as a group,
  including the above (20 individuals) ..................  2,144,790      9,713,575    11,858,365


                                                                 AMOUNT         PERCENTAGE OF STOCK
                                                              BENEFICIALLY      OUTSTANDING AS OF
NAME                                                              OWNED          DECEMBER 31, 2002
----                                                          ------------      -------------------
Marsh & McLennan Companies Stock Investment Plan (3)
1166 Avenue of the Americas
New York, NY 10036-2774                                        28,146,683              5.3%

(1)  As  of  February  28,  2003,  no  director  or  named   executive   officer
     beneficially owned more than 1% of the outstanding stock, and all directors
     and executive officers as a group beneficially owned  approximately 2.2% of
     the outstanding stock.

(2)  Includes  shares  of  stock:  (i) that are  held in the form of  shares  of
     restricted  stock;  (ii) that are held  indirectly  for the benefit of such
     individuals or jointly,  or directly or indirectly  for certain  members of
     such individuals'  families,  with respect to which beneficial ownership in
     certain cases may be disclaimed; and (iii) that represent such individuals'
     interests in MMC's Stock  Investment  Plan.  Also  includes MMC stock units
     that are subject to issuance  in the future with  respect to the  Directors
     Stock  Compensation Plan, cash bonus deferral plans, MMC's Stock Investment
     Supplemental  Plan or  restricted  stock units in the  following  aggregate
     amounts: Mr. Bernard, 55,300 shares; Mr. Cabiallavetta,  91,673 shares; Mr.
     Coster,  147,492  shares;  Mr. Davis,  140,841 shares;  Mr. Erburu,  38,581
     shares;  Mr.  Greenberg,  148,707 shares;  Mr. Groves,  71,298 shares;  Mr.
     Hardis, 13,352 shares; Ms. King, 9,452 shares; Mr. Lasser,  434,910 shares;
     Mr.  Schapiro  2,063 shares;  Mrs.  Simmons,  27,058 shares;  Mr.  Sinnott,
     303,469 shares;  Mr. Smith,  97,026 shares; and all directors and executive
     officers as a group,  1,729,834  shares.  Additionally,  includes shares of
     stock  which may be  acquired  on or  before  April 30,  2003  through  the
     exercise of stock options as follows:  Mr.  Cabiallavetta,  405,000 shares;
     Mr. Coster,  710,000  shares;  Mr. Davis,  520,000 shares;  Mr.  Greenberg,
     1,572,500 shares; Mr. Groves,  100,000 shares; Mr. Lasser,  315,000 shares;
     Mr. Sinnott, 565,000 shares; Mr. Smith, 2,000,000 shares; and all directors
     and executive officers as a group, 6,882,500 shares.

(3)  Under the provisions of the Stock Investment Plan, voting rights are passed
     through to the employees in proportion to their  interests.  Unvoted shares
     will  generally be voted by the trustee in  proportion to the shares voted.
     Shares held in the Plan are  registered  in the name of the Plan's  trustee
     and not in the  names of the  individual  participants.  Of the  28,116,960
     shares held in the Plan at December  31,  2002,  approximately  90,250,  or
     0.3%,  were  held  for  directors  and  executive  officers  of MMC and are
     included in the  ownership  shown  above for all  directors  and  executive
     officers as a group.



     The following  tables contain  information  with respect to the CEO and the
six other most highly  compensated  executive  officers of MMC. We adjusted  the
number of shares and per share prices to reflect MMC's  two-for-one  stock split
effective June 28, 2002.


     The following table sets forth cash and other  compensation  paid or earned
for services rendered in 2002, 2001 and 2000.

                                       ANNUAL COMPENSATION                    LONG TERM COMPENSATION
                            -----------------------------------------  -----------------------------------
     NAME AND                                            OTHER ANNUAL   RESTRICTED   SECURITIES     LTIP      ALL OTHER
     PRINCIPAL                                           COMPENSATION      STOCK     UNDERLYING    PAYOUTS  COMPENSATION
     POSITION               YEAR  SALARY($)  BONUS($)(1)    ($)(2)     AWARDS ($)(3) OPTIONS (#)   ($)(4)      ($)(5)
-----------------------     ----  ---------  ----------- ------------  ------------- ----------- ---------  ------------
Jeffrey W. Greenberg ...... 2002  1,200,000                 91,798      2,171,187     450,000    2,107,832     48,003
Chairman and Chief          2001  1,200,000   2,500,000    188,642      2,339,118     400,000           --     48,902
Executive Officer           2000  1,200,000   1,500,000         --      4,101,064     400,000      350,000     48,900
Marsh & McLennan
Companies, Inc.

Lawrence J. Lasser ........ 2002  1,000,000                 57,744      1,000,093     100,000           --    350,000
President                                                                              50,000(7)
Putnam Investments, LLC     2001  1,000,000  17,000,000         --      1,000,003     100,000           --    349,000
                                                                       10,627,000(6)   50,000(7)
                            2000  1,000,000  33,000,000         --      1,000,028          --           --    243,000

John T. Sinnott ........... 2002    950,000                     --      1,586,323     120,000           --     54,150
Chairman                    2001    900,000   1,200,000    165,943      1,380,953     120,000           --     51,300
Marsh Inc.                  2000    900,000     800,000    180,894      1,250,027     100,000           --     51,300

Peter Coster .............. 2002    950,000                515,930      1,720,376     120,000           --     54,150
President                   2001    950,000     750,000    198,051      1,791,943     140,000           --     54,863
Mercer Inc.                 2000    900,000     800,000    132,921      1,227,165     120,000           --     51,975

Mathis Cabiallavetta ...... 2002    850,000                     --      1,435,046     220,000           --     48,450
Vice Chairman               2001    800,000     875,000         --      1,316,413     200,000           --     46,200
Marsh & McLennan            2000    700,000     800,000         --      1,053,505     200,000           --     27,125
Companies, Inc.

Charles A. Davis .......... 2002    850,000                     --      1,576,952     200,000    1,794,373     34,002
Vice Chairman               2001    800,000     875,000         --      1,346,413     200,000           --     32,001
Marsh & McLennan            2000    750,000     800,000         --      1,227,561     200,000      105,000     30,000
Companies, Inc.
MMC Capital, Inc.

Ray J. Groves ............. 2002    850,000                     --        764,175     200,000           --     20,188
President and Chief         2001    333,333     250,000         --      1,012,601     200,000           --         --
Executive Officer
Marsh Inc.

(1)  Mr. Davis  deferred a portion of his bonus in respect of 2000 and 2001, and
     Mr. Lasser deferred a portion of his bonus in respect of 2000,  pursuant to
     plans under which  participants  may elect to invest their deferred amounts
     on a notional basis  indirectly in various  private equity funds managed by
     MMC subsidiaries and affiliated firms.

(2)  With regard to Messrs.  Greenberg and Coster,  represents payments to cover
     tax   liabilities   arising  from  funding   annuities  under  the  Benefit
     Equalization and  Supplemental  Retirement  Plans.  These plans are part of
     MMC's  United  States  retirement  program.  With  regard  to  Mr.  Lasser,
     represents  perquisites,  including  approximately  $35,000  for  financial
     advisory  services and $15,000 for a supplemental  healthcare plan provided
     to certain senior executives at Putnam.

(3)  At December 31, 2002, each individual in the Summary Compensation Table had
     outstanding  shares of restricted  stock and restricted  stock units of MMC
     with an aggregate value (using the closing price of common stock on the


     Consolidated  Transaction  Reporting System on December 31, 2002 of $46.21)
     as  follows:  Mr.  Greenberg,   148,300  shares  and  103,508  units  worth
     $6,852,943 and  $4,783,105,  respectively;  Mr. Lasser,  146,400 shares and
     434,910 units worth $6,765,144 and $20,097,191,  respectively; Mr. Sinnott,
     150,400  shares  and  146,790  units  worth   $6,949,984  and   $6,783,166,
     respectively; Mr. Coster, 161,000 shares and 105,994 units worth $7,439,810
     and $4,897,983,  respectively; Mr. Cabiallavetta,  10,000 shares and 78,038
     units worth $462,100 and $3,606,136, respectively; Mr. Davis, 42,600 shares
     and 84,760 units worth  $1,968,546 and  $3,916,760,  respectively;  and Mr.
     Groves,  18,334  shares  and  8,990  units  worth  $847,214  and  $415,428,

     During the applicable vesting and restricted periods,  holders of shares of
     restricted  stock receive the same  dividend  payments as those paid on the
     outstanding shares of stock and such shares generally vest on the January 1
     following the tenth anniversary of the date of grant. Holders of restricted
     stock units receive dividend  equivalent  payments that are equal in amount
     to dividends paid on shares of common stock,  and such units generally vest
     three  years  from the date of  grant.  Vesting  of  restricted  stock  and
     restricted stock units may be accelerated upon a change in control. "Change
     in  Control" of MMC means  generally  any of the  following:  any person or
     group becoming the owner of securities with 50% or more of the voting power
     of MMC;  within a two-year  period (with  certain  exceptions)  a change in
     directors  constituting a majority of the Board;  stockholder approval of a
     merger or  consolidation  of MMC resulting in MMC  stockholders  not owning
     securities  with 50% or more of the voting power of the  surviving  entity;
     and stockholder  approval of a plan of complete liquidation or an agreement
     for the sale or  disposition of all or  substantially  all of MMC's assets.
     Under the MMC Special  Severance  Pay Plan,  certain  holders of restricted
     stock  or  awards  in lieu of  restricted  stock  with at least 10 years of
     service will receive  payment in shares of stock upon  forfeiture  of their
     award if their employment with MMC or one of its  subsidiaries  terminates.
     The  amount  of such  payment  is  based  on  years  of  service,  with the
     individual  receiving up to a maximum of 90% of the value of the restricted
     shares  after  25  years of  service,  and is  subject  to  execution  of a
     non-solicitation agreement.

(4)  Under MMC  Capital's  Long Term  Incentive  Plan ("LTIP") Mr. Davis and Mr.
     Greenberg  have  received  various  awards,   including   carried  interest
     performance   payments.   The  LTIP  currently  operates  as  an  incentive
     compensation  pool that varies in amount based on the extent of  investment
     return  and  fees  from  originating,   structuring  and  managing  certain
     insurance  and  related  industry  investments  in which MMC has  direct or
     indirect  interests.  As of December 31, 2002,  the estimated  value of Mr.
     Greenberg's  and Mr. Davis'  interest in any future  payouts under the LTIP
     (including their carried interests)  aggregated  approximately $1.0 million
     and $0.8 million,  respectively,  in each case based on a liquidation value
     as of that  date and  subject  to  realization  of  estimated  returns  and
     including  awards with respect to fees received and realized  gains not yet
     distributed.  The vesting  schedules for carried interest awards made under
     the LTIP were  determined at the date of grant and will  accelerate  upon a
     change in control of MMC (as  described  in footnote 3 above),  a change in
     control of MMC  Capital  (defined to mean that MMC no longer owns more than
     50% of MMC  Capital),  or upon the  retirement,  death or disability of the
     participating executive.

     In addition,  in 1999,  Mr.  Greenberg  purchased  both general and limited
     partnership interests in the general partner of Trident II, and in 1999 and
     2000, Mr. Davis purchased both general and limited partnership interests in
     the general  partners of four private  equity funds managed by MMC Capital,
     including  Trident II. These purchases were on an after-tax,  out-of-pocket
     basis. In connection with these  partnership  interests,  Mr. Greenberg and
     Mr. Davis received  participations  in carried interests in these funds. In
     2000,  Mr.  Greenberg  and  Mr.  Davis  received   $237,267  and  $382,562,
     respectively,  in connection with their carried interests. At this time, it
     is not meaningful to project values of the carried interest participations.
     The carried  interests are subject to reduction or forfeiture in connection
     with  termination  of  employment.  However,  in the  event of a change  in
     control of MMC or MMC Capital  prior to a termination  of employment  other
     than for cause,  the carried  interests  cannot be so reduced or forfeited,
     even  with  respect  to  subsequent  investments.  From  time to time,  Mr.
     Greenberg and Mr. Davis may be excused from  participating  in a particular
     investment  in  order  to  avoid  the   appearance  of  any   inappropriate
     remuneration  or as otherwise  deemed  advisable.  See  "Transactions  with
     Management and Others;  Other  Information"  below.  Additionally,  in 1999
     and/or 2000, Messrs. Greenberg,  Lasser, Sinnott, Coster, Davis and Groves,
     either in their  capacities as employees of MMC or its  subsidiaries  or as
     directors of MMC, purchased, on an after-tax,  out-of-pocket basis, limited
     partnership  interests  in one or more  funds that  invest in or  alongside
     private  equity funds managed by MMC  subsidiaries  and  affiliated  firms.
     Neither  these  individuals  nor  their  funds  are  required  to  pay  any
     management,  carried  interest  performance  or other fees,  except in some
     cases an administrative fee, in connection with these investments.

(5)  Amounts  shown  for  2002  consist  of  the  following:  (a)  MMC  matching
     contributions  under the Stock Investment Plan of $7,334 for Mr. Greenberg,
     $10,450  for  Mr.  Sinnott,   $10,450  for  Mr.  Coster,  $10,450  for  Mr.
     Cabiallavetta  and $3,334  for Mr.  Davis,  and under the Stock  Investment
     Supplemental  Plan of $40,669 for Mr.  Greenberg,  $43,700 for Mr. Sinnott,
     $43,700  for Mr.  Coster,  $38,000 for Mr.  Cabiallavetta,  $30,668 for Mr.
     Davis and $20,188 for Mr. Groves


     and (b) contributions by Putnam Investments of $30,000 to the Putnam Profit
     Sharing  Retirement  Plan and  $120,000  to the Putnam  Executive  Deferred
     Compensation  Plan  for  Mr.  Lasser.  Additionally,  Mr.  Lasser  received
     $200,000 from MMC for his service as a trustee of the Putnam Funds. Amounts
     shown for 2001 for Mr. Lasser reflect an additional $96,000 from the amount
     shown in last year's  proxy  statement  for his service as a trustee of the
     Putnam Funds that was earned in 2001 but not paid until 2002.

(6)  Represents  Putnam restricted stock units. At December 31, 2002, Mr. Lasser
     had  101,250  restricted  stock  units of  Putnam  Class B  Shares  with an
     estimated  aggregate  value of  $4,587,638  based on a specified  valuation
     methodology  for  determining  fair market value which at December 31, 2002
     was $45.31 per share.  All grants of Putnam  restricted stock units include
     the right to  dividend  equivalents  that are equal in amount to  dividends
     paid on the  outstanding  Class A Shares of Putnam.  The Putnam  restricted
     stock  units  vest  at a rate  of  25% a  year  beginning  with  the  first
     anniversary  of the  date of the  grant.  Upon  the  happening  of  certain
     corporate  events  affecting  Putnam  or MMC,  vesting  of shares of Putnam
     restricted stock units may be accelerated.

(7)  Mr. Lasser was granted Putnam options,  which become exercisable 25% a year
     beginning one year from the date of grant. The exercise price of the Putnam
     options  may be paid in cash or in  Class B  Shares  of  Putnam.  Upon  the
     occurrence of certain  corporate events affecting Putnam or MMC, all Putnam
     options will become fully exercisable.


     The table below  describes MMC stock options  granted during 2002 and stock
options to purchase Putnam Class B Shares granted to Mr. Lasser in 2002.

                                          INDIVIDUAL GRANTS(1)
                          ------------------------------------------------     POTENTIAL REALIZABLE VALUE
                          NUMBER OF    % OF TOTAL                              AT ASSUMED ANNUAL RATES OF
                          SECURITIES     OPTIONS                                STOCK PRICE APPRECIATION
                          UNDERLYING   GRANTED TO   EXERCISE                        FOR OPTION TERM(2)
                            OPTIONS     EMPLOYEES     PRICE     EXPIRATION   -------------------------------
NAME                        GRANTED      IN 2002     ($/SH)        DATE          5% ($)            10%($)
----                      -----------  ----------   --------    ----------   --------------   --------------
Jeffrey W. Greenberg ....   450,000        2.1        56.00      3/20/2012       15,848,145       40,162,310
Lawrence J. Lasser ......   100,000        0.5        56.00      3/20/2012        3,521,810        8,924,958
                             50,000(3)     8.7        74.57      3/20/2012        2,344,834        5,942,269
John T. Sinnott .........   120,000        0.6        56.00      3/20/2012        4,226,172       10,709,949
Peter Coster ............   120,000        0.6        56.00      3/20/2012        4,226,172       10,709,949
Mathis Cabiallavetta ....   220,000        1.0        56.00      3/20/2012        7,747,982       19,634,907
Charles A. Davis ........   200,000        1.0        56.00      3/20/2012        7,043,620       17,849,916
Ray J. Groves ...........   200,000        1.0        56.00      3/20/2012        7,043,620       17,849,916
MMC Stockholders(4) .....                                                    18,902,052,792   47,901,512,964

(1)  All MMC stock options become exercisable 25% a year beginning one year from
     the date of  grant.  The  option  exercise  price may be paid in cash or in
     shares of common  stock.  In the  event of a change in  control  of MMC (as
     described in footnote 3 to the Summary Compensation Table above), all stock
     options  will become fully  exercisable  and vested,  and any  restrictions
     contained in the terms and conditions of the option grants shall lapse.  If
     any payments made in connection with a change in control are subject to the
     excise tax imposed under the federal tax laws, MMC will increase the option
     holder's  payment as necessary  to restore  such option  holder to the same
     after-tax position had the excise tax not been imposed.

(2)  The dollar amounts are the result of  calculations at the 5% and 10% growth
     rates set by the SEC; the rates are not intended to be a forecast of future
     stock price  appreciation.  A zero  percent  stock  price  growth rate will
     result in a zero gain for all option holders.

(3)  Mr.  Lasser was granted an option to acquire  Putnam  Class B Shares  which
     become  exercisable 25% a year beginning on March 21, 2003. The fair market
     value of each Putnam Class B Share on the date of grant was $74.57.

(4)  The dollar  amounts  are  included  for  comparative  purposes  to show the
     aggregate  gain that would be achieved  by all  holders of the  outstanding
     stock of MMC at the assumed  stock price  appreciation  rates at the end of
     the  10-year  term of the MMC  options  granted  on  March  21,  2002 at an
     exercise price of $56.00.



     The following table sets forth certain information concerning stock options
exercised during 2002 and the number and value of specified  unexercised options
at December 31, 2002.

                                                   NUMBER OF SECURITIES UNDERLYING        VALUE OF UNEXERCISED
                                                       UNEXCERCISED OPTIONS AT           IN-THE-MONEY OPTIONS AT
                             SHARES       VALUE           DECEMBER 31, 2002             DECEMBER 31, 2002 (1)(2)
                           ACQUIRED ON  REALIZED   --------------------------------  --------------------------------
------                    ------------  ---------  --------------  ----------------  --------------  ----------------
Jeffrey W. Greenberg ....        --            --   1,185,000        1,025,000         21,725,678       1,217,110
Lawrence J. Lasser ......    30,000       767,238     265,000          175,000          5,203,150           8,250
                                 --            --     416,250(3)       113,750(3)         570,000              --
John T. Sinnott .........    90,000     2,980,463     455,000          285,000          7,886,191         221,010
Peter Coster ............        --            --     590,000          310,000         11,778,191         222,660
Mathis Cabiallavetta ....        --            --     225,000          495,000            506,407         183,469
Charles A. Davis ........        --            --     345,000          475,000          2,691,528         227,609
Ray J. Groves ...........        --            --      50,000          350,000                 --              --

(1)  Values are based on the fair market value on December  31, 2002,  minus the
     grant price.

(2)  The value of unexercised in-the-money stock options at December 31, 2002 is
     presented pursuant to SEC rules and, with respect to MMC stock, is based on
     the  closing  price on the  Consolidated  Transaction  Reporting  System on
     December 31, 2002 of $46.21 and, with respect to the Putnam Class B Shares,
     is based on a specified  valuation  methodology for determining fair market
     value which at December 31, 2002 was $45.31 per share.  The actual  amount,
     if any, realized upon exercise of stock options will depend upon the market
     price of the stock relative to the exercise price per share at the time the
     stock  option  is  exercised.  There is no  assurance  that the  values  of
     unexercised  in-the-money  stock  options  reflected  in this table will be

(3)  Represents options to acquire Putnam Class B Shares.



     MMC maintains a United States retirement  program consisting of the Marsh &
McLennan Companies  Retirement Plan, a non-qualified  Benefit  Equalization Plan
and a non-qualified Supplemental Retirement Plan.

     The following  table shows the estimated  before-tax  annual  straight-life
annuity  benefit payable under these  retirement  programs to employees with the
specified Maximum Average Salary (average salary over the 60 consecutive  months
of employment that produces the highest  average) and specified years of service
upon  retirement  at age 65,  after  giving  effect to  adjustments  for  Social
Security benefits:

                                                 YEARS OF SERVICE
AVERAGE SALARY            5          10          20          30          40          45
--------------         --------    --------    --------    --------    --------   ----------
$ 800,000 ............ $ 75,870    $151,739    $303,478    $443,348    $523,348     $563,348
$ 900,000 ............ $ 85,870    $171,739    $343,478    $501,348    $591,348     $636,348
$ 1,000,000 .......... $ 95,870    $191,739    $383,478    $559,348    $659,348     $709,348
$ 1,100,000 .......... $105,870    $211,739    $423,478    $617,348    $727,348     $782,348
$ 1,200,000 .......... $115,870    $231,739    $463,478    $675,348    $795,348     $855,348
$ 1,300,000 .......... $125,870    $251,739    $503,478    $733,348    $863,348     $928,348
$ 1,400,000 .......... $135,870    $271,739    $543,478    $791,348    $931,348   $1,001,348
$ 1,500,000 .......... $145,870    $291,739    $583,478    $849,348    $999,348   $1,074,348

     The compensation of participants  used to calculate the retirement  benefit
consists of regular  salary as disclosed  in the "Salary"  column of the Summary
Compensation  Table and  excludes  bonuses and other forms of  compensation  not
regularly  received.  For the six individuals named above, other than Mr. Lasser
who participates in the Putnam Profit Sharing  Retirement Plan and related plans
and  not in  MMC's  U.S.  retirement  program,  the  2002  compensation  used to
calculate the Maximum Average Salary and the number of years of credited service
are as follows: Mr. Greenberg,  $1,200,000,  7 years; Mr. Sinnott,  $950,000, 40
years; Mr. Coster, $950,000, 41 years; Mr. Cabiallavetta, $850,000, 4 years; Mr.
Davis,  $850,000, 5 years; and Mr. Groves,  $850,000, 1 year. Mr. Lasser is also
entitled to receive a special retirement benefit in accordance with the terms of
the Lasser Agreement. See "Employment Agreement" below.


     Putnam  Investments  ("Putnam"),  a subsidiary  of MMC,  has an  employment
agreement  with Lawrence J. Lasser,  its President and Chief  Executive  Officer
(the "Lasser  Agreement") dated December 31, 1997, and amended in 2001. The term
of  the  Lasser  Agreement  expires  on  December  31,  2005.  MMC  has  certain
obligations and has guaranteed Putnam's  obligations under the Lasser Agreement.
MMC has also  agreed  to use its best  efforts  to  include  Mr.  Lasser  on the
management slate of nominees for directors when his current term expires at this
year's Annual Meeting of Stockholders.

Under the Lasser Agreement:

     o    Mr. Lasser receives an annual salary of $1,000,000 and is eligible for
          annual bonuses under MMC's Senior  Management  Incentive  Compensation

     o    Upon his retirement (or at the time he is no longer subject to certain
          limitations  imposed by the Internal  Revenue Code with respect to the
          tax  deductibility of his compensation  ("162(m)  Limitations")),  Mr.
          Lasser will receive a special  retirement benefit in consideration for
          a non-competition covenant and post-employment


          consulting arrangement. The then estimated present value equivalent of
          this benefit,  $15,000,000,  is deemed invested from December 31, 1997
          in various Putnam funds.

     Mr.  Lasser  was also  granted a deferred  special  payment  ("Putnam  Fund
Payment")  equal to the value,  as of February 15,  2001,  of 300,000 MMC shares
(150,000 shares before the June 28, 2002 two-for-one  stock split).  Such amount
is deemed invested in Putnam funds in accordance with Mr. Lasser's direction and
vests on December 31, 2005.  The Putnam Fund Payment shall be paid to Mr. Lasser
on the later of December 31, 2005 or the date upon which he is no longer subject
to 162(m) Limitations,  or, before such date, in the event of termination of his
employment  due to death,  disability,  Good Cause,  or by Putnam or MMC without
cause.  Mr.  Lasser will not receive the Putnam Fund Payment if he is terminated
for cause or terminates his own employment (other than for "Good Cause"),  prior
to December  31, 2005.  The Putnam Fund Payment will be forfeited if Mr.  Lasser
violates the non-competition covenant.

     In March of 2002, Mr. Lasser received options to acquire (i) 100,000 shares
of MMC stock and (ii) 50,000 Class B Common Shares of Putnam ("Class B Shares").
Mr.  Lasser also is  entitled to receive an award of options to acquire  100,000
shares  of MMC  stock in March of each of 2003 and 2004.  These  options  become
exercisable  25% a year  beginning  one year from grant or upon the happening of
certain corporate events.

     If Mr. Lasser's  employment is terminated by Putnam or MMC without cause or
if he terminates  his  employment  for "Good  Cause",  Mr. Lasser will receive a
payment equal to his base salary and annual bonus for the balance of the term of
the Lasser Agreement.  The Lasser Agreement provides for accelerated  vesting or
forfeiture of Putnam  restricted  stock units,  Putnam  options,  MMC restricted
stock  units  and  MMC  options  upon  certain   terminations  of  Mr.  Lasser's
employment.  Equity based  awards  granted  pursuant to the original  employment
agreement, which would have expired on December 31, 2001, are not forfeited upon
employment terminating after that date.

     If any payments under the Lasser  Agreement  attributable to (i) the Putnam
options to acquire 175,000 Class B shares granted on December 31, 1997, (ii) the
150,000 Putnam  restricted  stock units vesting on December 31, 2001,  (iii) the
MMC options, (iv) MMC restricted stock units, or (v) the Putnam Fund Payment are
subject to the excise tax imposed under the federal tax laws,  MMC will increase
the payment to Mr.  Lasser as  necessary  to restore  him to the same  after-tax
position had the excise tax not been imposed.

"Good Cause" is defined generally to include:

     o    an uncured  breach by Putnam or MMC of a  material  term of the Lasser

     o    a relocation of Putnam's  executive  offices or a reassignment  of Mr.
          Lasser to a location outside of the Boston area;

     o    the failure to pay Mr. Lasser a minimum  annual bonus equal to the sum
          of (i) two times  the bonus  amount  corresponding  to a  pre-assigned
          partnership   interest  of  5%  under  Putnam's   Partners   Incentive
          Compensation  Plan with a specified base  partnership  percentage plus
          (ii) an amount  corresponding  to one unit  under  Putnam's  Operating
          Heads Incentive Compensation Plan;

     o    failure to grant the additional equity-based awards described above;

     o    a change in control of MMC (as described in footnote 3 to the "Summary
          Compensation Table" below); or

     o    a change in control of Putnam (defined to mean that MMC no longer owns
          more than 50% of Putnam).


                          COMPENSATION COMMITTEE REPORT


     MMC  is a  professional  services  firm  with  businesses  having  distinct
economic characteristics,  marketplaces and operating conditions. The leadership
position attained over time by MMC's operating  subsidiaries in their respective
businesses in terms of services provided,  market share, revenue,  profitability
and rate of growth has been earned largely  through the selection,  training and
development  of top  caliber  executive,  managerial  and  professional  talent.
Ongoing  investment  in the  firm's  executive  talent  has  produced  favorable
long-term returns to MMC stockholders.  Therefore, it is critical to the ongoing
success  of MMC that  its  executives  continue  to be  among  the  most  highly
qualified  and capable  professionals  available  in their  respective  business
segments to lead the organization's businesses and to create stockholder value.

     The Compensation Committee of the Board of Directors,  all of whose members
are  independent  non-executive  directors,  is  charged  by MMC's  Compensation
Committee charter with reviewing and approving MMC's  compensation  philosophies
and overseeing the  development  and  implementation  of  compensation  programs
intended  to  attract,   retain  and  motivate  highly  capable  and  productive
employees.  To that end,  MMC's  executive  compensation  program is designed to
reinforce business strategies,  reflect marketplace practices and dynamics,  and
provide cost and tax effective  incentives  and rewards.  The committee  reviews
program  elements  regularly to consider and implement any changes  necessary to
achieve these ongoing  objectives.  MMC's  philosophy  regarding  incentives and
rewards is  implemented  through  compensation  policies  and plans  intended to
enhance  financial  performance  in  a  highly  competitive  marketplace,  which
includes  competition  from  privately-held  firms  offering  attractive  equity
ownership   opportunities.   In  terms  of  compensation   data,  the  committee
periodically  reviews  the  levels of  executive  compensation  from a number of
survey  sources  and,  as  appropriate,  through  projects  undertaken  with the
assistance  of  outside  professional  consultants,  with a  focus  on pay  data
available relating to professional  talent among MMC's businesses.  In addition,
the committee  periodically  evaluates chief executive  officer  compensation by
comparing it to data developed from a selected group of major  corporations  (16
in 2002) in diversified financial,  banking and insurance sectors. This grouping
is broader than the peer grouping in the Stock Performance Graph set forth below
in order to  obtain a  meaningful  representation  of  competitive  compensation
practices and levels for senior executive positions in comparable  companies and
industry segments.

     The Chief  Executive  Officer  of MMC  heads a group of  senior  management
officers,  most of whom are executives of MMC's  operating  subsidiaries.  These
senior  officers  participate  in  various  compensation  plans  and are paid in
accordance with award  guidelines and performance  criteria that reflect overall
MMC  and  individual  operating  unit  performance.  The  plans,  which  include
short-term and long-term elements, are intended to be retrospective,  reflecting
prior  individual  and  organizational  performance,  as  well  as  prospective,
providing motivation and rewards for achieving future success. Such compensation
is designed to reflect the combined annual and long-term performance of MMC, the
operating  subsidiary and the employee.  Moreover,  individual  contributions by
these executives are assessed in the context of a top management team that views
itself as a professional partnership.

     Members of the senior management group of Putnam Investments participate in
a different compensation program, which is based on competitive practices in the
investment management industry.  In terms of annual incentives,  these employees
are  eligible  for  bonuses  that  are  determined  based  on the  absolute  and
incremental  profit of  Putnam.  With  regard  to  long-term  incentives,  these
employees are eligible to receive periodic awards of Putnam restricted stock and
stock  options  with  respect  to Class B  shares  of  Putnam;  they may also be
considered for grants of MMC restricted  stock and/or options from time to time.
Since  employees  of Putnam  participate  in a  separate  compensation  program,
statistics  provided in the  following  sections of this report  relating to the
compensation of MMC's senior management group exclude Putnam employees.



     With regard to short-term compensation, salaries are reviewed annually, and
increases   are  approved  by  the  Committee  on  a   discretionary   basis  in
consideration  of  current  individual  and  organizational  performance,  role,
affordability and marketplace factors.  Organizational performance refers to the
business  unit's  success  in  achieving  business   objectives  and  addressing
conditions  affecting  long-term  growth and profits.  For  participants  in the
senior  management  compensation  program,  salaries  are  compared  to the  top
quartile of the relevant  marketplace,  with aggregate annual cash  compensation
adjusted  to reflect  MMC's  performance.  Salaries  accounted  for 33% of total
compensation  (excluding  stock  options)  in 2002 for MMC's  senior  management

     The size of the incentive award pool for senior  management cash bonuses is
based on earnings and reflects MMC's net operating income growth.  However,  the
Committee may approve a payout of less than the full bonus pool. In this regard,
a specific  target level is not  established for the award pool, nor, absent any
contractual   obligations,   are  minimum  award  levels  guaranteed  for  bonus
recipients. With respect to individual award determinations, such assessments by
the  Committee  are  largely  judgmental,  not  formulaic,  weighing  the  Chief
Executive  Officer's   recommendation  and  evaluation  as  to  the  executive's
managerial and professional role within the organization,  relative contribution
(compared  with the internal peer group) to the firm's  operations  and earnings
growth, and marketplace  compensation levels. For MMC's senior management group,
individual  bonuses  constituted  37% of  total  compensation  (excluding  stock
options) for 2002.


     It is the Committee's  strongly held belief that the continuing  success of
MMC is  dependent  on the  effectiveness  of  programs  intended  to retain  and
motivate its  executives.  Accordingly,  long-term  compensation  is designed to
recognize the individual's  potential  future  contributions to the organization
and to link the  executive's  financial  interests with those of stockholders by
fostering  stock  ownership.   Such  equity  ownership   opportunities  for  MMC
executives are made available  through plans that provide for restricted  stock,
restricted  stock  unit and  stock  option  grants.  Moreover,  in order to help
promote  retention  of key  talent  through  stock  ownership  that is at  risk,
ownership rights to restricted  stock,  restricted stock units and stock options
are acquired  over time.  In addition,  under  voluntary  deferral  programs,  a
supplemental  equity  award  with  vesting  requirements  may be  granted  as an
incentive for long-term stock ownership.

     Within this framework,  absent a contractual  obligation,  the size of each
executive's  equity grants reflects the  recommendations  of the chief executive
officer with grants  authorized at the sole  discretion of the  Committee.  Such
determinations   include   consideration  of  MMC's  future  profit  performance
expectations and the individual's  organizational  role, current performance and
potential to contribute  to the long-term  success of MMC, as well as review and
consideration of the competitive  practices on which award guidelines are based.
These  considerations,  and not prior stock-based  awards or MMC stock ownership
targets, determine the mix and size of stock grants to individuals.

     Most  members of MMC's  senior  management  group are  eligible  to receive
annual  discretionary  restricted  stock grants on the basis described above. In
2002, the awards for this senior  management  group accounted for 19% (including
supplemental equity awards as described above) of total compensation  (excluding
stock options).

     A select number of participants  from the senior  management group are also
eligible for an annual  discretionary grant of restricted stock units, which are
deferred  stock-based awards. The awards reflect MMC's earnings and growth, with
individual grants based on the subjective  factors outlined above including each
executive's organizational role and performance.  Historically,  the grant value
of  individual  awards  has  ranged  from  approximately  50%  to  150%  of  the
executive's cash bonus.  Units earned are  distributable in shares and generally
vest after  completion  of three  years of service  from the date of grant.  The
restricted stock units granted in 2002 to MMC's senior  management group made up
11% of total compensation (excluding stock options) for the year.

     Stock options are another equity element of senior management compensation.
Members of the


senior  management  group are eligible for option grants on an annual basis. The
size of an individual  grant reflects the factors  discussed  earlier  including
organizational role, performance and marketplace practices. Present holdings may
be  considered  as well  but no  reference  is made to  unexercised  options  or
appreciation thereon.


     As noted above, MMC's executive compensation program is designed to be cost
and tax effective. The Committee's policy is to take actions deemed to be in the
best  interests  of  MMC  and  its  stockholders,   recognizing,  however,  that
compensation  payments may not in all  instances  qualify for tax  deductibility
because of the  restrictions set forth in Section 162(m) of the Internal Revenue


     Both the  quantitative  and  qualitative  criteria  described  earlier  are
applied in assessing the performance  and  determining  the  compensation of the
Chairman and Chief Executive  Officer of MMC, Jeffrey W. Greenberg.  Current and
long-term  financial  performance of MMC,  information which is available to all
MMC   stockholders,   are  major   factors  in  arriving  at  the   compensation
determinations made by the Committee relative to Mr. Greenberg. Consideration is
also  given to his  leadership  and  influence  on the  long-term  strength  and
performance of MMC.

     The  annual  base  salary for Mr.  Greenberg  during  2002 was  $1,200,000,
unchanged  since  January 1, 2000.  With  regard to cash  bonus,  Mr.  Greenberg
participates  in the same MMC annual  incentive plan as MMC's senior  management
group. His 2002 cash bonus award under the plan was $3,000,000.

     In connection with long-term compensation, Mr. Greenberg was granted 15,000
shares  of  restricted  stock  in 2002  under  terms  previously  described.  In
addition,  Mr. Greenberg was granted 24,008 restricted stock units in connection
with his 2001 cash bonus and received 1,500 restricted stock units for deferring
receipt  of  vesting  shares of  restricted  stock.  The  combined  value of his
restricted stock and restricted  stock unit grants was $2,171,187.  In addition,
Mr. Greenberg was granted 450,000 stock options during 2002.

     Mr.  Greenberg  also  participates  in the MMC Capital Long Term  Incentive
Plan,  which is  structured  to reflect  compensation  practices  in the private
equity investment industry.  Pursuant to the terms of the plan, he received cash
payments  totaling  $2,107,832  in 2002.  In  addition,  in 1999  Mr.  Greenberg
received a carried  interest  in  Trident  II as a result of owning  partnership
interests in the general partner of Trident II.

     Based  on the  previously  referenced  review  of chief  executive  officer
compensation  for 2001  (latest  data  available),  Mr.  Greenberg's  2002  cash
compensation  was positioned at  approximately  the 70th  percentile of the 2001
market survey group,  and his long-term  compensation  (including  any long-term
incentive  plan  payouts  but  excluding  stock  options)  was at about the 65th
percentile of the 2001 survey market.  The 450,000 stock options  granted to Mr.
Greenberg  during  2002  approximated  the 55th  percentile  of the 2001  survey
market.  Total  compensation  for Mr.  Greenberg  in 2002,  which  includes  all
elements of pay from the Summary  Compensation Table except stock option grants,
was at about the 65th percentile of the 2001 survey market.

                          OF THE MMC BOARD OF DIRECTORS

Lewis W. Bernard           Robert F. Erburu            The Rt. Hon. Lord Lang of
                                                               Monkton, DL



     The following  graph compares MMC's  cumulative  total  stockholder  return
(rounded to the nearest  whole  dollar) on its stock,  the Standard & Poor's 500
Stock Index and a  company-constructed  composite industry index,  consisting of
Aon Corporation, Arthur J. Gallagher & Co., Franklin Resources, Inc. and T. Rowe
Price Group,  Inc.,  over the  five-year  period from  December 31, 1997 through
December 31, 2002.


                               MMC    S&P 500    Index
                               -----   -------  ---------
                     1997      100      100       100
                     1998      121      129        89
                     1999      202      156       102
                     2000      252      141       129
                     2001      236      125       133
                     2002      208       97       103

     Assumes  $100  invested  at the  closing  price on  December  31, 1997 with
dividends reinvested on the date of payment without commissions. This table does
not forecast future performance of MMC common stock.



     From time to time,  in the ordinary  course of business  and on  commercial
terms,  MMC and its  subsidiaries may provide services to, or in connection with
transactions  involving,  investment funds and their portfolio companies managed
or advised by MMC Capital,  in which various executive officers and directors of
MMC have direct or indirect interests. Such services include:

     o    acting as an insurance or reinsurance broker;

     o    consulting;

     o    transaction advisory services; or

     o    investment management.

     A portion of the fees  received  by MMC  Capital or its  subsidiaries  from
portfolio  companies for transaction,  management or other advisory  services is
dedicated   to  the  LTIP  pool   described   in   footnote   4  to   "Executive
Compensation-Summary Compensation Table".

     The aggregate amount received for all such services rendered in 2002 by MMC
and its subsidiaries was  approximately $76 million.  This amount  predominantly
consists of insurance brokerage and related payments made by portfolio companies
to MMC subsidiaries  relating to insurance and reinsurance  placements with such
insurers in the normal course of business.

     In June 2002, Trident II purchased 43.3% of The ARC Group, LLC ("ARC") from
Marsh  &  McLennan  Risk  Capital  Holdings,   Ltd.  ("MMRCH"),  a  wholly-owned
subsidiary of MMC. Trident II paid $23.6 million for this interest, resulting in
a gain of  approximately  $9.0 million for MMC. The purchase price is subject to
reduction by up to $1.2 million under certain limited  circumstances,  depending
on the total proceeds  ultimately  realized by Trident II. The  transaction  was
approved by the  Executive  Committee of the Board of Directors of MMC, with Mr.
Greenberg  recusing  himself.  In passing on the adequacy of the purchase price,
the Committee considered a report by MMC's Planning & Analysis Group and a March
2002 purchase by Trident II of a 27% interest in ARC at the same  valuation from
Arch Capital Group Ltd., a publicly  traded  company in which each of Trident II
and MMC has a minority interest.  All members of the Executive Committee who are
investors in Trident II and Mr. Davis have excused themselves from participating
in Trident II's investment in ARC.

     Under the MMC Capital,  Inc. LTIP, Messrs.  Greenberg and Davis and certain
other employees of MMC Capital  participate in the profit generated from certain
investments  made by MMRCH,  such as the ARC investment.  Messrs.  Greenberg and
Davis each would have  received a payment of  approximately  $210,000  under the
terms  of the LTIP in  connection  with  MMRCH's  sale of its  interest  in ARC.
However,  in view of the potential conflict of interest,  Messrs.  Greenberg and
Davis have waived  receipt of these LTIP  payments  unless and until  Trident II
recovers  its  purchase  price on the ARC  investment,  in which  event  Messrs.
Greenberg  and Davis  would be  entitled  to  receive  the LTIP  payments,  with
interest  accrued on amounts paid at a rate of 4.74% per annum  through the date
of payment.


     Section  16(a)  of the  Securities  Exchange  Act of  1934  requires  MMC's
directors and executive  officers,  and persons who own more than ten percent of
the common  stock of MMC,  to file with the SEC and the New York Stock  Exchange
initial  reports of  beneficial  ownership  and reports of changes in beneficial
ownership of MMC stock.  Such  persons are also  required by SEC  regulation  to
furnish  MMC  with  copies  of all  Section  16(a)  forms  they  file.  To MMC's
knowledge,  based solely on a review of the copies of such reports  furnished to
MMC and written representations that no other reports were required, during 2002
all Section  16(a)  filing  requirements  applicable  to such  individuals  were
complied with except for one report covering one  transaction  filed late by Mr.



                         PROPOSED AMENDMENT TO RESTATED
                          CERTIFICATE OF INCORPORATION

     The  Board of  Directors  has  approved  an  amendment  to  MMC's  Restated
Certificate of  Incorporation  to increase the aggregate number of shares of MMC
common  stock  which MMC is  authorized  to issue,  from eight  hundred  million
(800,000,000)  to  one  billion  six  hundred  million  (1,600,000,000).   MMC's
authorized  preferred  stock  of six  million  (6,000,000)  shares  will  remain
unchanged.  The Board determined that this amendment was advisable following the
2-for-1 stock split of MMC's common stock on June 28, 2002. The complete text of
the proposed amendment,  which would amend the first paragraph of article FOURTH
of the  Restated  Certificate  of  Incorporation,  is  attached  to  this  Proxy
Statement as Exhibit A.

     As of December 31, 2002, MMC had 535,589,137  shares of common stock issued
and outstanding and approximately 93,294,427 shares committed to be issued under
MMC's various employee  benefit and compensation  plans. The remaining number of
authorized  shares of common  stock  available  for  issuance  is  approximately
171,116,436.  The additional 800 million shares proposed to be authorized  would
be issuable from time to time for various  corporate  purposes,  including stock
splits, stock dividends,  employee benefit and compensation plans,  acquisitions
and public or private sale for cash as a means of raising capital.  MMC does not
at this time have any understanding,  arrangement or agreement pursuant to which
any of the additional shares to be authorized would be issued.

     If approved by the  stockholders,  the  proposed  increase in the number of
authorized  shares  of  common  stock  could  have the  effect of making it more
difficult for another party to gain control of MMC on an unfriendly basis, since
MMC could issue such additional  shares to a third party.  MMC knows of no party
with  intentions  of gaining  control  of MMC and MMC has no  present  plans for
selling shares in connection with such a situation.

     MMC believes that approval by MMC  stockholders  of the proposed  amendment
will  provide  the Board of  Directors  with  flexibility  and will  enhance its
ability to respond to  various  corporate  opportunities  which may arise in the
future  without  the delay of  seeking  shareholder  approval.  The  Board  will
continue to seek  stockholder  approval  for  transactions  which  require  such
approval under our by-laws, Delaware law and/or the rules of any stock exchanges
on which our shares are listed at the time of the transaction.

     The amendment to the Restated  Certificate of Incorporation  does not alter
the rights and  privileges of MMC's  outstanding  shares of common stock,  which
include a stockholder rights plan, or the manner in which the Board of Directors
may authorize the issuance of  additional  shares of common or preferred  stock.
Holders of MMC common stock have no preemptive  rights and current  stockholders
would not have any preferential  right to purchase any of the additional  common

     Under  Delaware law, the favorable vote of the holders of a majority of the
outstanding  shares of MMC common stock will be required to adopt this  proposed
amendment.  Unless  otherwise  directed in the proxy,  the persons  named in the
proxy  will  vote  FOR the  proposal  to amend  MMC's  Restated  Certificate  of
Incorporation increasing the number of authorized shares of common stock.




     The  Audit  Committee  has  recommended,  and the  Board of  Directors  has
approved, the selection of Deloitte & Touche LLP as independent auditors for the
2003 fiscal year,  subject to stockholder  ratification.  Deloitte & Touche will
audit our  consolidated  financial  statements for fiscal 2003 and perform other
services.  Deloitte & Touche  acted as MMC's  independent  auditors for the year
ended December 31, 2002. A Deloitte & Touche  representative  will be present at
the meeting, and will have an opportunity to make a statement and to answer your

     The  affirmative  vote of a majority of the shares of MMC stock  present or
represented  and  entitled  to vote at the  meeting  is  required  to ratify the
appointment of Deloitte & Touche LLP.  Unless  otherwise  directed in the proxy,
the  persons  named in the proxy will vote FOR the  ratification  of  Deloitte &
Touche LLP. The Board recommends you vote FOR this proposal.


   The Audit  Committee has adopted  preapproval  policies and  procedures  with
respect to the engagement by MMC or its subsidiaries of Deloitte & Touche LLP to
render audit and  non-audit  services.  For the fiscal years ended  December 31,
2001 and 2002,  fees for services  provided by Deloitte & Touche LLP, the member
firms of  Deloitte  Touche  Tohmatsu  and their  respective  affiliates  were as

                   FEES                                   2002           2001
----------------------------------------------         ----------     ----------

AUDIT FEES for the audit of MMC's annual
financial statements and reviews of the
financial statements included in MMC's
quarterly reports on Form 10-Q, and including
services in connection with statutory and
regulatory filings or engagements .................... $8,796,000     $8,396,000

AUDIT-RELATED FEES, including fees for audits
of employee benefit plans, computer and
control related audit services, agreed-upon
procedures, merger and acquisition assistance
and accounting research services ..................... $2,727,000     $2,138,000

TAX FEES for tax consulting and compliance
services not related to the audit .................... $2,055,000     $1,102,000

IMPLEMENTATION FEES related to Marsh Inc.
financial system implementation services
contracted for in 2001 which were concluded
in 2002 .............................................. $2,600,000     $2,875,000

ALL OTHER FEES including administrative
services related to regulatory compliance and
other non-audit services. In 2001 also
includes non-financial information system
services and in 2002 also includes market
research services .................................... $3,122,000     $4,949,000


                             AUDIT COMMITTEE REPORT

     The  primary  function  of the Audit  Committee  is to assist  the Board of
Directors in its oversight of MMC's financial  reporting process.  The Committee
operates  pursuant  to a  charter  approved  by the  MMC  Board.  Management  is
responsible  for MMC's  financial  statements  and  overall  reporting  process,
including  the  system  of  internal  controls.  The  independent  auditors  are
responsible  for  conducting  annual  audits  and  quarterly  reviews  of  MMC's
financial  statements  and  expressing  an opinion as to the  conformity  of the
annual financial statements with generally accepted accounting principles.

     In the  performance of its oversight  function,  the Committee has reviewed
and  discussed  the audited  financial  statements  as of and for the year ended
December 31, 2002 with  management and the independent  auditors.  The Committee
has also  discussed  with the  independent  auditors the matters  required to be
discussed by Statement on Auditing  Standards No. 61,  COMMUNICATION  WITH AUDIT
COMMITTEES.  Finally, the Committee has received the written disclosures and the
letter from the independent  auditors  required by Independence  Standards Board
whether the provision of information  technology consulting services relating to
financial  information  systems design and  implementation  and other  non-audit
services  by  the  independent  auditors  to  the  Company  is  compatible  with
maintaining the auditor's  independence  and has discussed with the auditors the
auditors' independence.

     It is not the duty or  responsibility  of the Committee to conduct auditing
or   accounting   reviews  or   procedures.   In  performing   their   oversight
responsibility,  members of the Committee rely without independent  verification
on  the  information  provided  to  them  and  on the  representations  made  by
management and the independent accountants.  Accordingly,  the Audit Committee's
oversight does not provide an independent basis to determine that management has
maintained   appropriate   accounting  and  financial  reporting  principles  or
appropriate  internal controls and procedures designed to assure compliance with
accounting standards and applicable laws and regulations. Furthermore, the Audit
Committee's considerations and discussions do not assure that the audit of MMC's
financial  statements has been carried out in accordance with generally accepted
auditing standards or that the financial  statements are presented in accordance
with generally accepted accounting principles.

     Based upon the review and discussions described in this report, and subject
to the limitations on the role and responsibilities of the Committee referred to
above and in the  charter,  the  Committee  recommended  to the  Board  that the
audited  financial  statements  referred to above be  included  in MMC's  Annual
Report on Form 10-K for the year ended  December  31,  2002 to be filed with the
Securities and Exchange Commission.

                        SUBMITTED BY THE AUDIT COMMITTEE
                          OF THE MMC BOARD OF DIRECTORS

           Oscar Fanjul                            David A. Olsen
         Stephen R. Hardis                       Morton O. Schapiro
         Gwendolyn S. King                          Adele Simmons



     Stockholders  who wish to present a  proposal  and have it  considered  for
inclusion in MMC's proxy  materials for the 2004 Annual Meeting of  Stockholders
of MMC must submit such  proposal in writing to MMC in care of the  Secretary of
MMC on or before November 29, 2003.

     Stockholders who wish to present a proposal at the 2004 Annual Meeting that
has not been  included in MMC's  proxy  materials  must submit such  proposal in
writing to MMC in care of the  Secretary of MMC. Any such  proposal  received by
the Secretary of MMC on or after February 16, 2004 shall be considered  untimely
under the provisions of MMC's by-laws governing the presentation of proposals by
stockholders.  In  addition,  the  by-laws of MMC contain  further  requirements
relating to the timing and content of the notice which stockholders must provide
to the  Secretary  for any  nomination  or matter to be properly  presented at a
stockholders meeting.

     Such proposals should be addressed to:

     Marsh & McLennan Companies, Inc.
     1166 Avenue of the Americas
     New York, New York 10036-2774
     Attn: Mr. Gregory Van Gundy,
           Corporate Secretary

By order of the Board of Directors,

/s/ Gregory Van Gundy

Gregory Van Gundy



                       OF MARSH & MCLENNAN COMPANIES, INC.


     Article FOURTH of the Restated  Certificate of Incorporation is proposed to
be amended by  revising  the first  paragraph  of Article  FOURTH to read in its
entirety as follows:

     FOURTH:  The total number of shares of stock which the  Corporation has the
authority to issue is  1,606,000,000  of which 6,000,000 are shares of Preferred
Stock with a par value of one dollar per share  (hereinafter  sometimes referred
to as "Preferred  Stock"),  and  1,600,000,000 are shares of Common Stock with a
par value of one dollar per share (hereinafter  sometimes referred to as "Common


Marsh & McLennan Companies, Inc.
1166 Avenue of the Americas
New York, NY 10036-2774