AMP chair Catherine Brenner resigns after scandals uncovered by banking commission
The chair of financial services giant AMP, Catherine Brenner, has resigned from her $660,00-a-year role, the latest casualty from the unfolding scandals uncovered by the banking royal commission.
Australia’s largest wealth manager will also strip directors of 25% of their fees for the rest of the year. AMP’s general counsel, Brian Salter, is also leaving, and the company has warned there will be “employment and remuneration” consequences for others involved in the fees-for-noservice scam.
Malcolm Turnbull said he thought Brenner had made the right call, and said more generally that directors must be accountable for wrongdoing.
“They have got to take responsibility for what has gone on and make the appropriate steps,” Turnbull said. “In some cases that has involved people stepping down or retiring or resigning.”
The board held a crisis meeting on Sunday amid speculation that Brenner was to be asked to stand down.
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The fees-for-no-service scandal has already claimed AMP chief executive Craig Meller’s job and wiped $2.2bn off the company’s market value during the commission’s two-week financial advice hearing.
On Friday counsel assisting the royal commission, Rowena Orr QC, outlined a series of possible misconduct findings against AMP for misleading the Australian Securities and Investments Commission, including breaches of the Corporations Act that carry criminal penalties.
“Through AMP’s dealings with Asic regarding the extent and nature of its fee for no service conduct, AMP adopted an attitude toward the regulator that was not forthright or honest, and demonstrated a deliberate attempt to mislead,” Orr said.
In a statement released on Monday by AMP, Brenner said: “I am honoured to have been chairman of AMP. I am deeply disappointed by the issues at hand and am particularly concerned for the impact they have had on our customers, employees, advisers and shareholders.
“As chairman, I am accountable for governance. I have always sought
to act in the best interests of the company and have been in discussions with the board about the most appropriate course of action, including my resignation. The board has now accepted my resignation as chairman as a step towards restoring the trust and confidence in AMP.”
On Monday Malcolm Turnbull acknowledged Brenner’s resignation, saying board directors had to be accountable for any wrongdoing.
“They have got to take responsibility for what has gone on and take the appropriate steps,” the prime minister said. “In some cases that has involved people stepping down or retiring or resigning.”
AMP endured a torrid two days at the royal commission. The inquiry heard the corporate watchdog was misled 20 times in two years by AMP over the extent of the fees-for-noservice scandal.
It also attempted to have an independent report into the feefor-no-service scandal rewritten by law firm Clayton Utz. The report was redrafted 25 times with changes from the company before being given to the Australian Securities and Investments Commission. Salter was among those who marked up or suggested changes to the report.
The royal commission heard the effect of his changes appeared to minimise the knowledge and involvement of AMP’s most senior executives. At one point, AMP attempted to delete mentions of Meller, the now outgoing executive.
“The board, including the former chairman, were unaware of and disappointed about the number of drafts and the extent of the group general counsel’s interaction with Clayton Utz during the preparation of the report,” AMP said on Monday.
“The board commissioned and received the report. It was not a matter for the board’s approval.”
Earlier this month, AMP’s head of financial advice, Anthony Regan,
chief admitted he had lost count of the number of times the business misled the corporate regulator.
Regan conceded there were cultural issues that needed to be addressed, and agreed the company had put its profitability ahead of its regulatory obligations.
“I think there are reasons to be concerned. I think they show a culture that’s not as robust as it should be,” Regan said.