New AMP boss Francesco De Ferrari didn’t mince his words when he fronted an auditorium packed with angry shareholders in Sydney last week.
Taking over the lectern from chairman David Murray, Mr De Ferrari introduced himself and his credentials, which include launching his own companies as an entrepreneur before a 17-year career at Credit Suisse, most recently running the private banking business in Asia. Many of AMP’s new executives, including wealth boss Alex Wade, were poached from the Swiss investment bank.
“I was approached with this fantastic opportunity to come and lead AMP, a truly iconic company that was going through a significant crisis,” Mr De Ferrari said.
“I often get asked why I would leave such a comfortable job to take on what some of the press have described as one of the greatest corporate challenges in Australian history,” he said. “I was really attracted by what we do in this company matters for our customers.”
After running through a slide deck that showed AMP has over 3.5 million customers and helped over $125,000 Australians retire last year, the CEO cut to the chase.
“Not all the numbers are positive. For shareholders, 2018 has been truly a terrible year. You would have seen our share price lose half of its value, compared to the average ASX 200 financial services company that lost 10 per cent. Clearly not an acceptable performance for our shareholders. So what are we doing about it?
“Since becoming CEO, my priority has been to work with David (Murray, AMP chairman) and the board to transform AMP,” he said.
“In terms of executive change, we have restructured and streamlined the leadership team. We have brought new talent to the leadership team. We have also started to focus on improving our offering to our customers.”
AMP has a major transformation journey on its hands. Wealth management isn’t the only division the group is looking to rebuild, despite the significant negative attention it received during the Hayne royal commission.
But Mr De Ferrari sees a big opportunity in wealth management, despite all the bad press and perhaps to the contrary of some of AMP’s major bank competitors.
“I find it interesting as a newcomer to the market that, given the changes from the royal commission, a lot of the large players have decided to exit the industry, leaving a significant unmet demand,” he said. “We firmly believe that AMP has a key role to play.”
AMP Capital, the group’s asset management arm, and AMP Bank will also be under the microscope as the new CEO looks to completely revamp an Australian institution that needs to move on from what he repeatedly labelled a “crisis”.
Mr De Ferrari said any large transformation of a company that has “been through such a crisis” needs to be anchored in its true sense of purpose.
“AMP’s sense of purpose goes back 170 years. Many of the older buildings in which we operate still feature the Amicus statue, with the Goddess of Plenty standing above a family. It also bears a Latin inscription, which translated in English means ‘a certain friend in uncertain times’.”
For the new chief executive, these edifices are symbolic of AMP’s original purpose of financial dependability. The company now has a long road of recovery ahead as it tries to instil these values across the organisation and win back the support of shareholders.