Newly appointed AMP chief executive Alexis George says rebuilding the 172-year-old company’s reputation is crucial to its success, after successive scandals have caused customers, investors and staff to abandon the wealth giant.
AMP reported its half-year results on Thursday and declared no interim dividend would be paid following a slide statutory profits to $146 million, down from $203 million last year. It experienced $6.7 billion in outflows from AMP Capital as clients continue to pull funds from the tarnished entity.
But there were bright spots across the business, with AMP Bank’s profits jumping by 76 per cent to $88 million, mainly due to the reduction in provisions for bad loans for COVID-19, which pushed the company’s share price up by 3.89 per cent to $1.12 per share in early afternoon trade.
New AMP chief Alexis George vows to fix group’s battered reputation.Credit:
Ms George, who started in the role only last week, said there was no simple answer to explain the ongoing cash outflows but acknowledged the damage to the group’s reputation had been “serious”.
“Our customers, whether they’re institutional customers, whether they’re retail customers, have been concerned about some of the things that have happened in the past,” Ms George said. “We have to face into that, we have to address it, and move on.”
AMP has been described as the “company that kills careers”, having suffered four board purges this century, most recently following revelations of systemic misconduct during the 2018 banking royal commission and last year’s investor revolt over the poor handling of sexual harassment complaints.
The former ANZ executive said AMP had become a target for negative media attention due to its size and history and while it was impossible to rule out more scandals in the future, Ms George brushed off concerns about risks to her own reputation.
“I have worked in this industry for over 25 years and I think I’ve been able to maintain a reasonable personal reputation. Clearly that’s important to me. I’ve taken on this job because I really think we can return this brand to an iconic brand again. I wouldn’t be doing it if I didn’t believe otherwise,” she said. “To say there’s never going to be a negative thing written about us again, I think would be a little silly.”
Ms George said she had already met once with frontline staff “without anyone else in the room” to hear their concerns, as part of her ongoing commitment to lift the company’s culture. “People who are working here want to see the negativity attached to the brand stop. They’re really passionate about the company.”
The leadership reshuffle comes during a period of significant change for AMP, as it reshapes its financial advice model and prepares to de-merge and publicly list AMP Capital’s private markets business.
Ms George reaffirmed plans to retain a 20 per cent stake in the de-merged business, a decision Allan Gray managing director Simon Mawhinney criticised. “Alexis went on to say it’s not a long-term holding. Just rip off the bandaid thank you very much. If they don’t do that immediately, there will be a 20 per cent overhang. It’s not what we want.”
Ms George flagged a “strategy refresh” would be launched, adding later that investment in technology was crucial. “The first thing I want to do is elevate technology. I think that hasn’t had a seat at the big table. As we look forward, we need to be more agile, we need to use data and digital more sensibly.”
But Morningstar analyst Shaun Ler said improving AMP’s corporate culture should continue to be Ms George’s number one priority. “At the end of the day, AMP is a human capital business. You need your humans to feel comfortable working, then the rest will fall into place.”
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