What does your /etc/xdg/compiz/compiz-manager file contain?  If it looks like 
this:
"""
# Ubuntu specifc compiz-manager configuration file
# goes into /etc/xdg/compiz/compiz-manager
# works with git://anongit.compiz-fusion.org/fusion/misc/compiz-manager
COMPIZ_BIN_PATH="/usr/bin/" 
PLUGIN_PATH="/usr/lib/compiz/" 
COMPIZ_NAME="compiz.real"
"""
what does running "echo $XDG_CONFIG_DIRS" print?

** Changed in: compiz (Ubuntu)
       Status: Confirmed => Incomplete

-- 
compiz fails to start
https://bugs.launchpad.net/bugs/222002
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