The rebuke comes amid ongoing frustration from long-term AMP shareholders,after the company spent the past few years trying to turn itself around following a fall from grace at the 2018 royal commission into financial misconduct.
AMP’s share price has fallen about 75 per cent in the past five years,as the company has sold businesses in life insurance and asset management to focus on wealth management and banking.
In an annual meeting lasting more than three-and-half hours,Hazelton acknowledged the pain of long-suffering AMP investors. She said she was “extremely disappointed” that the share price had dropped 16 per cent after February’s profit results,notwithstanding a better share price performance in 2022.
Despite AMP’s challenges,she highlighted efforts to simplify the business and flagged action to curb costs,saying a “structural shift is required to right-size AMP’s cost base”. Hazelton also stressed the company had been forced to confront enormous changes due the 2018 royal commission.
‘That royal commission totally upended AMP’s business model ... It had an enormous effect on AMP,almost existential.’
Debra Hazelton,AMP chair
The 2018 inquiry exposed deep-seated problems in the wealth management and superannuation industries,and helped kill off the “vertical integration” model whereby financial businesses sold and recommended products “manufactured” by the same institution.
“What I’d like to say is that royal commission totally upended AMP’s business model. It meant that the vertical integration business model was totally upended. It had an enormous effect on AMP,almost existential,” Hazelton said in response to a shareholder question.