Catherine Brenner

AMP today announces Catherine Brenner has resigned as Chairman and will step down from the Board. Mike Wilkins has been appointed as Executive Chairman, effective immediately.

Mr Wilkins will lead the company as Executive Chairman for an interim period while the process for selecting a Chairman, and appointment of an additional new non-executive director, is conducted. This will further strengthen governance and ensure stability while a measured process of board renewal is undertaken.  Mr Wilkins will now lead the selection process for a new Chief Executive Officer, which is in progress.

AMP also announces that Group General Counsel and Company Secretary Brian Salter will leave the company.  His outstanding deferred remuneration will be forfeited as a result of the Board exercising its discretion.

The Board has received advice from Philip Crutchfield QC, Tamieka Spencer Bruce of Counsel, and Tim Bednall of King & Wood Mallesons in relation to certain issues raised in the Royal Commission concerning the preparation of the Clayton Utz report on AMP’s fee for no service issue.  The advice follows the establishment of the Board Committee chaired by Mr Wilkins to examine the issues relating to AMP’s advice business that have been raised in the Royal Commission.

Having considered and assessed the matters, the Board is satisfied that the former Chairman Catherine Brenner, former Chief Executive Officer Craig Meller and the other directors did not act inappropriately in relation to the preparation of the Clayton Utz report.

The Board, including the former Chairman, were unaware of and disappointed about the number of drafts and the extent of the Group General Counsel’s interaction with Clayton Utz during the preparation of the report.  The Board commissioned and received the report.  It was not a matter for the Board’s approval.

The Board announces the following further actions:

• Recognising collective governance accountability for the issues raised in the Royal Commission and for their impact on the reputation of AMP, the Board is reducing fees for all AMP Limited Board Directors by 25 per cent for the remainder of the 2018 calendar year; and
• The employment and remuneration consequences for the individuals within the business responsible for the fee for no service issue will be determined on finalisation of an ongoing external employment review, which is expected to complete shortly

Catherine Brenner said: “I am honoured to have been Chairman of AMP. I am deeply disappointed by the issues at hand and am particularly concerned for the impact they have had on our customers, employees, advisers and shareholders.

“As Chairman, I am accountable for governance. I have always sought to act in the best interests of the company and have been in discussions with the Board about the most appropriate course of action, including my resignation. The Board has now accepted my resignation as Chairman as a step towards restoring the trust and confidence in AMP.”

Mike Wilkins, Executive Chairman, AMP Limited said: “The Board acknowledges Catherine’s leadership and thanks her for her professionalism, integrity and dedication to the company over the past eight years. We will now begin a process of board renewal, including fast-tracking selection of a Chairman, and a new director. This process will help ensure stability and further strengthen governance.

“AMP respects the Royal Commission process. I can assure you that the evidence and submissions presented by Counsel Assisting are being treated extremely seriously by the Board. Appropriate steps are being taken to address the issues raised, and remediating our customers is being given utmost priority. On behalf of the Board, I reiterate our sincerest apology to our customers, and know we have significant work to do to rebuild their trust.”

AMP will be making a formal submission to the Royal Commission by Friday 4 May in response to the matters raised in closing submissions by Counsel Assisting the Royal Commission.

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Craig Meller

AMP apologises unreservedly for the misconduct and failures in regulatory disclosures in the advice business.

The AMP Limited Board today announces the following actions to accelerate the necessary change within the organisation:

• The Board and the Chief Executive Officer, Craig Meller, have agreed that he will step down from his role with immediate effect.
• Mike Wilkins, a Non-Executive Director on the AMP Limited Board since September 2016 and a former CEO of IAG Limited, has been appointed as acting Chief Executive Officer until the search for the new CEO is completed.
• An immediate, comprehensive review of AMP’s regulatory reporting and governance processes will be undertaken. This work will be overseen by a retired judge or equivalent independent expert who will be appointed imminently.
• A Board Committee has been established to review the issues related to the advice business raised in the Royal Commission. The Committee is chaired by Mike Wilkins and will act with the assistance of external counsel, King & Wood Mallesons.
• The Group General Counsel, Brian Salter, has agreed to take leave while the review is undertaken. David Cullen, AMP General Counsel, Governance has been appointed as acting Group General Counsel.

AMP will be making a submission to the Royal Commission to respond to the issues raised. The submission will, among other matters, address the issue of the independence of the Clayton Utz report.

The Board will withdraw resolution four from its Notice of Meeting to the 2018 Annual General Meeting, which relates to an equity grant for the Chief Executive Officer.

The actions announced today build upon the existing program of work, instigated in 2017. The work underway includes:

• Customer remediation, with the program well progressed and 15,712 customers identified and $4.7 million fees refunded to date.
• An external review to ensure all fee for no service business practices have ceased. This review is now complete and has confirmed that the practices ceased in November 2016.
• An independent investigation into employee conduct. Based on the review’s findings, the Board will determine the employment and remuneration implications for any relevant individuals around the fee for no service matter.
• A review and complete overhaul of governance, systems and processes in the advice business.
• An enterprise-wide cultural audit conducted by an external consultant.
• An enterprise-wide review of risk governance, controls and culture also conducted by an external consultant.

AMP Chairman Catherine Brenner said: “AMP apologises unreservedly for the misconduct and failures in regulatory disclosures in our advice business. The Board is determined that we will meet these challenges head on, accelerating changes in both culture and performance at AMP.

“We have been driving much-needed change and improvement in our advice business, which has undergone significant leadership and governance renewal over the past year but we know we have much more to do to.”

Craig Meller said: “I am honoured to have been the CEO of AMP. I am personally devastated by the issues which have been raised publicly this week, particularly by the impact they have had on our customers, employees, planners and shareholders. This is not the AMP I know and these are not the actions our customers should expect from the company.

“I do not condone them or the misleading statements made to ASIC. However, as they occurred during my tenure as CEO, I believe that stepping down as CEO is an appropriate measure to begin the work that needs to be done to restore public and regulatory trust in AMP.”

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Ms  Brenner joined the AMP Limited Board in 2010 and was until recently the  Chairman of AMP Life and NMLA. She holds directorships with Boral and Coca-Cola  Amatil and was formerly a senior investment banker and corporate lawyer.

Ms  Brenner said that she was honoured to be appointed Chairman of a company which  is dedicated to delivering better outcomes for its customers and improving  returns for shareholders.

“The  board and management team remain focused on the delivery of AMP’s strategy – transforming  its core Australian business to be more customer centred, continuing its focus  on efficiency and agility and capitalising on its investment strengths and  capability to grow internationally.”

Ms  Brenner also said that the board remains committed to expanding the skills and  capability of its membership.

“We  have a highly skilled board but expect to make additional appointments to  further strengthen our collective background, perspective and experience  against the strategy.”

Outgoing  Chairman John Palmer said the board had given its strong and unanimous support  for Catherine’s appointment.

The  AMP Limited Board also thanked John Palmer for acting as interim Chairman.  Mr Palmer had postponed his retirement from  the board to oversee the appointment and transition to a new Chair.

“John  retires today with our best wishes and gratitude for his contribution of more  than 10 years on the boards of AMP and its subsidiaries,” said Ms Brenner.

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