AMP issues grovelling apology
AMP did not tell the public about misconduct in its financial advice business because doing so may have affected the regulator's investigations, the company's executive chairman has told shareholders.
Speaking at AMP's AGM in Melbourne, interim executive chairman Mike Wilkins began by apologising for the scandal. "We let you down," he said.
Mr Wilkins said he had been "repeatedly" asked why scandalous conduct, including the charging of fees for no service, was not revealed by AMP before it was exposed at the banking royal commission in April.
Mr Wilkins said disclosing any facts could have prejudiced an ongoing ASIC investigation.
He described the conduct as "a small number of individuals" not following policy and the situation being compounded by "communications that misrepresented the issue" to regulators.
"The behaviour was absolutely unacceptable," he said, but added that the board took "decisive action" on learning about the breaches.
AMP may have a strike recorded against it as it faces shareholders for the first time since the revelations of misconduct were made at the banking royal commission. The wealth management giant is fronting investors following the departure of its chairman, and chief executive over the scandals.
Three board members are also leaving, two before the AGM, and another by the end of the year. One director, Andrew Harmos, will seek re-election despite opposition from the Australian Shareholders Association.
ASA spokesman Ian Graves said the board would not support Mr Harmos. Mr Harmos joined the AMP board in June last year but has been on the boards of subsidiaries, AMP Life and the National Mutual Life Association of Australasia since 2013.
"Admittedly those subsidiaries are not in the advice area but we feel sure that if we are going to get a full board renewal ... there is collective governance accountability," Mr Graves said.
Mr Graves predicted there was likely to be a strike recorded against AMP's remuneration report. "From what I understand there are a number of people annoyed enough about it and we think there is a likelihood of a strike - if not there will be a significant number of votes against it," he said.
AMP will have a strike recorded against it if more than 25 per cent of investors vote against the report. Despite being non-binding, another strike at next year's meeting would force a vote on whether to spill the board.
Meanwhile, AMP says it will vigorously defend two class actions bought against it after shedding more than $2 billion in market value since it began giving testimony at the royal commission.