AMP shareholders have voted in favour of the wealth manager’s remuneration report, but the leadership team says further uncertainty awaits as the company embarks on a multi-year journey to lift earnings and rebuild its share price.
More than 89 per cent of shareholders at Thursday’s annual general meeting in Sydney supported the report, which was overhauled along with the company’s board after 61 per cent of shareholders voted against executive pay last year.
But investors also expressed their concern that the company’s share price had continued to slide – and cash outflows increased – despite the company’s efforts to repair its reputation and financial position after the financial services royal commission.
Both chairman David Murray and chief executive Francesco Di Ferrari said the firm had taken on board the lessons of the inquiry and last year’s overwhelming protest vote, and asked investors for patience.
“We can be optimistic about the future… but we also need to be very realistic about the issues, and what we need to do to get out of it,” Mr Di Ferrari said.
“This transformation of AMP is going to be a multi-year journey and will not happen overnight… It will require investment to restructure and reposition the business.”
AMP shares crashed and the firm slashed its dividend as it paid to fix its costly mistakes and misconduct, but Mr Murray said the overhauled leadership was focused on improving accountability and improving governance.
Mr Murray, who was was re-elected to the board with 87.31 per cent approval, said the complex sale and separation of the firm’s life insurance business was a major variable going forward.
“After the sale of our life insurance business, the board will be in a position to reassess AMP’s future capital buffers and structure,” he said.
Mr Murray also said the looming federal election and wider economic instability were clouding the path ahead, while additional regulatory changes are expected from the royal commission and customer remediation continues.
Significant reputational damage is another hurdle the business must clear, he said.
“I think the CEO quite rightly pointed out that this is not a quick process, because of the range of factors that we are dealing with… and we can only type them in the correct sequence,” Mr Murray said.
AMP shares fell again on Thursday after it said it had experienced net cash outflows of $1.8 billion in the first quarter.
The 170-year-old company had been facing the possibility of a second strike on executive pay, which would trigger a vote on a board spill, but averted the crisis by scrapping short-term cash bonuses and cutting directors’ fees.
Shareholders also approved the appointment of directors John Fraser, John O’Sullivan and Andrea Slattery to the AMP board at Thursday’s meeting.
AMP also announced the appointment of chief financial officer John Patrick Moorhead ahead of the AGM.
The current CFO and chief operating officer of AMP Capital will replace Gordon Lefevre from June 1, the company said in an announcement on Thursday morning.