On Monday, Australian wealth manager AMP Ltd stated, its chairman had resigned and the CEO of its funds management unit will be demoted, following concerns about alleged inappropriate conduct by the latter.
In June 2020, AMP’s board, chaired by David Murray, had appointed Boe Pahari to head its AMP Capital despite an internal investigation regarding comments passed by Pahari on a female colleague in 2017, which breached the company’s code of conduct.
“Although the Board’s decision on the appointment was unanimous, my decision to leave reflects my role and accountability as Chairman of the Board and the need to protect continuity of management, the strategy and, to the extent possible, the Board,” said Murray in a statement to the exchange.
Murray’s exit marks one of corporate Australia’s highest profile casualties with complaints revolving around gender-based misconduct upending workplaces around the world.
Murray was the CEO of the Commonwealth Bank of Australia, Australia’s biggest lender, for 13 years; he held several senior government advisory positions before being called in to stabilize AMP following a 2018 scandal.
AMP had “always treated the complaint against Mr Pahari seriously” and despite the strong support for AMP’s strategy, “some shareholders did not consider Mr Pahari’s promotion to AMP Capital CEO to be appropriate”.
Debra Hazelton, a non-executive director, will now replace Murray; Pahari will step down as AMP Capital’s CEO and resume work at his previous level, said the company.
“I genuinely regret that my comments made a colleague feel uncomfortable. It was never my intention, but I accept that they had an impact and I apologized and accepted the consequences,” said Pahari.
“AMP’s actions on this matter have now been decisive,” said Simon Mawhinney, a fund manager at Allan Gray regarding Pahari’s promotion being inappropriate.
According to Louise Davidson, CEO of the Australian Council of Superannuation Investors, AMP’s initial response to wider concerns around Pahari’s appointment and the conduct claims was “inadequate.”
She went on to add, “today’s announcements signal change in the organization.”