Market not judging Alexander Forbes

The exodus of Alexander Forbes executive management in the past few months is unsettling but the market is unlikely to judge the company harshly, say analysts.

Instead, performance of the pension fund administrator’s stocks will be more dependent on how well new CEO Dawie de Villiers is able to implement his turnaround plan. “The current situation is unsettling for the business, and it will require hard work and a consistent message to stabilise the organisation that’s highly reliant on its people,” said Karl Gevers, head of research at Benguela Global Managers.

SA’s largest pension fund administrator has lost several members of its executive team, starting with CEO Andrew Darfoor, fired by the board in September, followed by the resignation of CFO Naidene Ford-Hoon.

The latest blow came two weeks ago when Leon Greyling, CEO of Alexander Forbes Investments, group chief risk officer Vishnu Naicker and Christian Schaub, who served as the chief human resources officer, quit.

The company did not announce their resignations at the time and says details thereof are confidential.

“Transparency is essential for investors and corporates to build trust and confidence in management’s ability to govern and execute strategic priorities.

“Unfortunately, the Alexander Forbes board has been ineffective at managing perceptions and investors will remain sceptical of board decisions for months to come,” said Warwick Bam, head of research at Avior Capital Markets.

Analysts said the departures of executives, especially those appointed during Darfoor’s term, were, however, not surprising given the change in CEO.

“There would also be an element of the new CEO wanting to build a team he trusts,” said Gevers.

Bam said Darfoor was influential in the appointment of foreign nationals in key executive positions.