Updated from 10:07 a.m. EDT

Marsh & McLennan

(MMC) - Get Report

will provide insurance customers with a "full accounting" of its revenue streams under reforms outlined by the embattled financial services company Tuesday.

The measure is part of a deal cut by Marsh to avoid criminal prosecution by New York Attorney General Eliot Spitzer. The company ousted CEO Jeffrey Greenberg Monday night in another concession to Spitzer, who had effectively sought his dismissal.

Michael Cherkasky, a former prosecutor and corporate detective who once was Spitzer's boss at the Manhattan district attorney's office, was named the company's new chief executive.

Marsh's stock rose $2.26, or 8.5%, to $28.68, after losing nearly 50% of its value in the two weeks since the insurance scandal broke. Also moving sharply higher were shares of



, the nation's second-largest insurance broker, up $2.35, or 11%, to $22.

The most significant action announced by Marsh is a decision to provide brokerage clients with a "full accounting of all revenue earned" on insurance deals brokered by its flagship Marsh Inc. unit. The step is meant to address charges the company fleeced corporate clients by hiding from the big fees the firm received from insurers on every deal it brokered.

The company also reiterated its decision to stop accepting contingent commissions from insurers, a type of payment that Spitzer has likened to a kickback.

Marsh also is establishing an internal compliance department to monitor its operations. The compliance unit will be aimed at ferreting out illicit schemes such as the alleged bid-rigging and price-fixing Spitzer found at Marsh. Spitzer contends Marsh persuaded insurance employees to go along with the price-fixing scheme in order to boost premiums, a tactic that cheated Marsh's clients but generated fatter contingent commissions for the brokerage.

The company said all the moves are intended to make Marsh's billing operations as "transparent'' as possible to its customers.

"We are on the road to getting this behind us,'' Cherkasky said at a press conference. "It's a serious issue, which we regret. And while it has been a damaging blow to us, we will recover.''

He rejected some critic characterizations of Marsh as company that is rotten to the core.

"I don't think this company is terrible,'' said Cherkasky. "I don't think it ever was.''

The move to stop accepting contingent commissions could have big ramifications for the firm. Last year, such fees generated $845 million in revenue, or 11% of the firm's total.

Marsh could make up for some of that lost revenue by charging its corporate clients more. But it appears the firm will not charge insurers a straight commission on any deals it negotiates, meaning Marsh is looking at a sizeable revenue gap going forward.

Cherkasky, however, said it was too soon to say just how much of a financial impact the reforms would have on Marsh's business.

''We haven't done a dollar-for-dollar analysis of how we will replace our revenues,'' said Cherkasky. "But the ultimate source of our revenues, when we are working for a client, will be from our client.''

In a related move, Marsh announced it was delaying the release of its third-quarter earnings to Nov. 9.

Although increased transparency appears to be the new mantra at Marsh, Cherkasky balked at discussing a number of subjects.

After defending Marsh and saying instances of price-fixing were "discreet and narrow,'' Cherkaksy offered no opinion on whether Greenberg had been made a "scapegoat'' to save the company. He also declined to comment on whether it was appropriate for Spitzer or any prosecutor to demand the ouster of a CEO as the starting point for negations.

Cherkasky also said he couldn't say whether Marsh would divulge the terms of settlement it negotiated in 2001 with a private law firm that sued to challenge the legality of the contingent fee deals at the heart of the Spitzer complaint.

Cherkasky's press conference was the latest effort at damage control at Marsh, which has been scrambling to salvage its business and reputation since Spitzer's office unveiled his lawsuit against the firm. For now, the moves appear to be working.

Late Monday, Spitzer issued a statement praising the move to oust Greenberg and promote Cherkasky, who had been a top executive at Kroll, the corporate investigative firm Marsh acquired earlier this year. The New York prosecutor also applauded the company's reforms.

"We are persuaded that the goals that would have been advanced by a criminal prosecution of the corporation -- punishment, restitution, general deterrence and industry reform -- will be better accomplished by criminal prosecution of individuals, adoption by the company of dramatically new business procedures, installation of new leadership, a full explanation of prior wrongdoing and a pledge of restitution to those harmed," Spitzer said.

Some on Wall Street, however, say it's too soon for Marsh to declare victory.

"My initial reaction is it is probably a step in the right direction," said David Sheusi, a J.P. Morgan analyst, commenting on Greenberg's departure. "But I think people are trying to understand the economics of the business model" in light of the changes the company is making.

Sheusi, who has an underweight rating on Marsh's stock, said it's too soon to say how the company's earnings model will compare going forward. Similarly, Smith Barney maintained a sell rating on the stock, leaving its price target at $27.

Among other things, the skepticism reflects Wall Street concerns that a full settlement is a long way off. A person familiar with the investigation said it is unlikely Spitzer would be prepared to settle so early in the process. In the mutual fund investigation, Spitzer's office often announced settlements with mutual fund companies many months after the charges were first filed.

Meanwhile, Aon may be the next to face Spitzer's wrath. People familiar with the investigation say Spitzer's office is taking a particularly close look at Aon's business practices.

Late Friday, Aon said it too would stop accepting contingent commissions. Aon joins Marsh and Willis Group, the third biggest broker, to forgo a huge source of revenue.

Aon and Marsh both report third-quarter earnings this week and are expected to discuss the investigation during postearnings conference calls.

St. Paul Travelers


said Monday it had also received a subpoena from Spitzer's office "requesting documents and seeking information relating to the conduct of business between insurance brokers" and itself.