Growing shareholder revolt over AMP’s management of a now high-profile sexual harassment incident threatens to lead to an extraordinary meeting being called to seek board scalps.
The events of the next week or so will determine how the situation transpires, and whether investors take that course of action and call the meeting. Momentum is gathering.
Many want the formal investigation into the complaint about Boe Pahari released as quickly as possible, but others want him gone amid the fallout of his promotion and sordid and now public details of some of the 2017 complaint by Julia Szlakowski.
“It’s critical this gets dealt with. It’s been poorly managed,” one investor said.
Adding fuel to the fire is that AMP chief executive Francesco De Ferrari’s key recruit after taking the top job, Alex Wade, left this month for poor conduct including sending inappropriate photos to a female employee.
De Ferrari now has made fixing the wealth group’s culture his top priority, but change and lasting reform in this area takes years.
It’s an area AMP has grappled with for years, even though at times it has taken measures to lift the culture bar internally.
This column understands AMP Capital brought in Sydney-based firm Serendis several years ago to attempt to improve culture and leadership within the division. The firm’s website says it “transforms leadership practices for success in an increasingly complex world”.
Serendis — which also cites Perpetual, HSBC, ANZ and the Australian Securities & Investments Commission as customers on its website — has a team of 14 staff and puts itself at the crossroads of strategy, culture and human behaviour.
The program obviously didn’t have the desired impact and now AMP is looking to bring in other external experts to help.
A good starting point for the management and David Murray-led board of AMP, and any ASX-listed company, in understanding these topics is the National Inquiry into Sexual Harassment in Australian Workplaces. It was published in March. The report is research and data-based and delves into the subject with case studies that provide examples of how change can occur.
Perhaps not unsurprising, its most recent survey conducted in 2018 showed that sexual harassment in Australian workplaces is “widespread and pervasive”. Women and men are the subjects of this harassment and change won’t come easy.
The behaviour is a drag on productivity, can lead to higher staff turnover and in AMP’s case it has a clear financial cost by now dominating the time of management and the board.
Sex Discrimination Commissioner at the Australian Human Rights Commission Kate Jenkins says she is often asked by ASX directors how they should manage issues in the area, often in a reactive way.
She won’t comment on AMP directly but says there are a handful of tips she would give as a quick starting point for those wanting to take practical steps towards prevention of sexual harassment in the workplace.
Given the issues are systemic, Jenkins advocates an industry-wide strategy and approach to tackling it. That means industry bodies need to get more involved.
Companies also need to make sexual harassment part of their safety framework so that it becomes more than just dealing with complaints when they arise.
Jenkins says human resources and legal departments typically take an approach that is about “protecting the reputation of the company” and avoiding litigation, and companies need to rethink this.
Embedding sexual harassment in large companies would also involve more education, and improving support and complaint reporting options.
As a monitoring measure, boards could request more reporting on the numbers of non-disclosure agreements entered into by the company. That would mean they were more aware of any cultural issues developing at a broad level and ask pertinent questions of executives.
Jenkins wants chief executives and senior executives to look beyond having a policy and reacting to sexual harassment in a purely compliance-driven way.
“There’s lots of policies and ticking a box, that sense of compliance in a tick-a-box way,” she says. “I really didn’t see any direct correlation between a good policy… and the experience of the actual worker.”
Part of the solution is gender diversity, an area that AMP needs to improve on given just one of De Ferrari’s direct reports is a woman. That’s Helen Livesey, head of people and corporate affairs.
“Promoting gender equality is one of the protective factors, both to reduce sexual harassment but also for people to feel more confident to raise concerns,” Jenkins says.
This column advocates gender diversity on merit. The composition of the population and the number of highly capable women in financial services — across listed and private entities — proves there are candidates out there.
AMP’s leadership has to be more reflective of the population if it is serious about change, diversity and inclusion.
More Coverage
Scandals, takeovers, Swiftenomics: 2024 was a year to remember
The good, the bad and the ugly – 2024 was an eventful year for investors. We look back on the stories which made headlines and broke hearts.
There’s a lot to be optimistic about in 2025: Citi Australia
Mark Woodruff, the local boss of US banking giant Citi, says market conditions are turning positive for the coming year.