Old Mutual begins new chapter

The appointment of Iain Williamson as Old Mutual’s permanent CEO brings to an end a year of leadership uncertainty amid a protracted legal feud that has weighed on SA’s second-largest insurer.

The 175-year-old insurance group said it has appointed its former COO, Williamson, who was named interim CEO amid a messy legal dispute involving its former head Peter Moyo, who was axed over alleged conflict of interest relating to investment company NMT, of which Moyo is a co-founder. Old Mutual held a 20% stake.

The group won its case against Moyo earlier this year.

Speaking to Business Day about his appointment, Williamson said taking on the permanent role would bring more certainty and clarity about Old Mutual’s future position.

“We can be a little more deliberate on some of the strategic steps.

“It’s really just a question of cementing a lot of the thinking that we had in place without the uncertainty of a potential future [leadership] change,” Williamson said.

The insurance group’s legal battle with Moyo came while Old Mutual was fresh out of an extensive overhaul after it reduced its stake in Nedbank, sold its majority interest in its US asset manager and separated from its wealth management business in the UK.

Warwick Bam, head of research at Avior Capital Markets, said Williamson inherited “a company in need of some TLC [tender loving care]”, after the challenges in its leadership distracted it from executing on its strategy as it returned its primary listing to the JSE.

Old Mutual had had its primary listing in London since 1999.

“There was a grand plan when it independently listed after the unbundling from the Plc, and with that independence came a lot of responsibility and they were at the beginning of that journey.

“The disruption with the change in leadership delayed the execution of the intended strategy, and all of it comes down to operating efficiencies and utilising the scale of benefits that they have,” Bam said.

Bam said appointing a permanent CEO was an important step in the right direction, and that the market liked transparency, clarity of strategy and consistency.

While he expected the current environment of rising unemployment and contracting GDP to remain for some time as customers’ incomes became affected, it had sped up technology and digital agendas.

“The silver lining is that it has accelerated the pace of the leveraging of technology and the adoption of digital practices in our business … which I think we would’ve probably found hard to imagine six months ago.

“And one of the things we are doing is saying to ourselves, how do we keep that momentum going,” Williamson said.

The priority now is positioning the business to operate in a post-Covid world.

Bam said the effects of the Covid-19 pandemic were a particular challenge for Old Mutual, which depended on face-toface distribution at the entrylevel advised insurance market.

“They’ve got some decisions to make around how they manage that business model over the next 12 to 24 months.”