Former Cbus boss David Atkin calls for AMP review of culture

Cbus has been critical of AMP’s leadership over its handling of the situation that has led to several staff exits.

David Atkin, chief executive of construction industry superannuation fund Cbus. Picture: David Geraghty / The Australian.

The former chief executive of the $55bn construction industry super fund, Cbus, David Atkin, has called on the AMP to have a “critical review” of its culture to understand the problems behind the sexual harassment claims that have triggered high level exits this week.

“They need to have a complete, critical review of the organisation to really understand why they have got to this point and what they need to do to address it,” Mr Atkin, who stepped down last week as the long-running chief executive of the fund, said in an interview with The Australian.

“Just dealing with two or three individuals doesn’t necessarily resolve the issues which have caused it.

“You have to look at the underlying drivers and it comes back to having a cultural review of the organisation.”

“This is still required for them to work their way through this.”

An AMP shareholder, Cbus has been critical of AMP’s leadership over its handling of the situation which saw the promotion of Boe Pahari to head up AMP Capital in July this year despite a complaint lodged against him in 2017 and a penalty against him for his actions in relation to a former subordinate.

This week saw the departure of AMP chairman David Murray and John Fraser from the AMP board while Mr Pahari was demoted from his role as AMP Capital chief to his former role within the organisation.

Mr Atkin denied that the criticism by Cbus and other industry funds including Debby Blakey, the chief executive of the $52bn industry super fund HESTA, was part of a campaign by industry funds to attack AMP, as a rival retail superannuation organisation.

Labor Senator Deborah O’Neill also added to the pressure on AMP this week with a speech in federal parliament reading the account of another former AMP employee who said she had also been sexually harassed while working at the company.

Concerning for investors

Ms Blakey, whose fund is also an investor in AMP, also repeated her criticisms of AMP in an interview with ABC Radio on Thursday.

She said it was concerning for investors at the length of time it had taken for AMP to take the steps it had.

“We will continue to meet with AMP to understand the steps that they are going to take to address what we think is very, very broad cultural change which is needed.

She said HESTA, whose membership was more than 80 per cent female, had “long held a view that a company’s approach to gender equality will lead to better decision making and better culture.”

“AMP has clearly demonstrated that these risks are very material financial risks and impact a company’s performance,” she said.

Mr Atkin echoed her comments in his interview with the Australian, saying that the “AMP case study” showed “the impact sexual harassment can have on the culture of an organisation and being able to function effectively.”

“These things are a cancer in an organisation, when everyone knows that it somebody crosses the line and does the wrong thing, it gets tucked under the carpet.”

12 years as chief executive

Mr Atkin was speaking on his departure after 12 years as chief executive of the construction industry super fund which has grown from $12bn in assets when he took over in 2008 to $55bn in assets today.

The fund has also seen its membership grow from 500,000 when he took over to 750,000 today – despite the loss of smaller accounts which is occurring, particularly in the industry fund sector, with the closure of many smaller super fund accounts.

Mr Atkin said the COVID-19 pandemic would put further pressure for mergers of super funds.

He said the construction industry had been able to operate during the pandemic but its future was uncertain given a fall off in forward orders.

He predicted that the next few years would see a big increase in fund mergers as funds realised the benefits of scale in terms of needed investment in technology to cater for members and the ability to reduce fees by bringing investment decisions in house.

Cbus is currently doing due diligence over a potential merger with the much smaller Media Super, the industry fund for the media industry which has seen significant job losses in recent years.