Tribeca Partners senior portfolio manager Jun Bei Liu called for a major leadership shake-up to put an end to the fund outflows,arguing the recent departures of chairman David Murray and board director John Fraser weren't enough to alleviate investor concerns over the wealth manager's corporate governance.
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"At a board level,they need a complete refresh,"Ms Liu said,though conceding"it's a really tricky position. Who within the business will be able to guarantee or present a plan to the investors of how they might come back from here?"
Redemptions by super funds and other institutional clients saw AMP Capital's assets shrink to $189.8 billion in the three months to June 30. The company's wealth management arm saw total assets increase by 2 per cent to $122.1 billion,but outflows persisted due to a loss of corporate super mandates and payments to clients accessing their superannuation early in the COVID-19 crisis,AMP said in a trading update to the ASX.
After his demotion,Mr Pahari retained a key leadership role overseeing AMP Capital's expansion of unlisted assets – a part of the company that has seen $688 million growth in infrastructure debt.
Morningstar analyst Shaun Lerr said AMP was exposed to"key person risk"as investment mandates linked to individual employees were closely tied to AMP's performance. Mr Lerr said the high turnover of staff following the sexual harassment scandal had hurt the business,but it would be made worse if Mr Pahari was sacked.