We are now into the final days before the AMP AGM and it is pretty clear the meeting will be a fizzer in terms of achieving anything but there will be much hostility towards the board and management.
Robert Gottliebsen carried an excellent two part piece in The Australian about the GIO debacle, further entrenching that paper's position as a serious threat to The Australian Financial Review.
However, Pamela Williams hit back with an excellent double-hit on AMP in the Monday edition of The AFR. The combined effect of these two big newspaper hits were pretty damaging overall to the AMP.
The Williams piece in The AFR looked like a bit of a hatchet job on new CEO Paul Batchelor and appears to have enjoyed the full co-operation of ousted chairman Ian Burgess and a couple of other directors looking to set the record straight.
It seems Burgess has finally realised that The Sydney Morning Herald's Liz Knight is no longer the right person for him to be pedaling his lines through.
Gotty explains how the AMP could have found out all about the GIO's reinsurance disasters if it had just done a little bit of sensible research. Owen Roach, the insurance guru who knew all about GIO's risk-profile, could have told AMP all about it but they cancelled a key meeting the night before it was due to take place.
And Williams imparts the key fact that Batchelor refused to publicly support Burgess when asked. She says this was the key trigger that led to his resignation and presumably this came straight from Burgess.
New AMP chairman Stan Wallis is painted by Williams as someone who did not take a stand on anything when it came to the clinches. The pressure will be on him and Batchelor on Thursday and they both came out of the article not looking as good as when they went in.
Pressure From Small Shareholders
As usual, AMP is getting far more pressure from the press than its shareholders - large and small.
The instos will all wave through the incumbents despite the fact several of them are flawed with conflicts of interests, skeletons in the closets, too many directorships and factional associations. Check out the piece explaining how we recommend you should vote as a reminder of all this.
In regard to small shareholder pressure, a gentleman from Woollahra called Shann Turnbull and the Australian Shareholders' Association have been having a flurry of exchanges with AMP company secretary Christine McLoughlin and, to a lesser extent, chairman Stan Wallis.
This is all to be encouraged but will all count for nothing in the end.
The Sun-Herald in Sydney carried a story on the meeting and media interest is likely to rise leading into Thursday.
This is what the Sun-Herald journalist Gillian Bullock wrote:
Vigilantes Gunning For AMP
Published May 14, 2000
By Gillian Bullock
Angry shareholders will be baying for blood at AMP's annual meeting on Thursday, despite having already claimed the scalp of former chairman Ian Burgess.
Facing the barrage of criticism in Melbourne over its record will be acting chairman Stan Wallis and new chief executive Paul Batchelor.
Two new proposed directors will be challenged.
The outcry will be led by Australian Shareholders Association (ASA) Victorian chairman Stan Mather and self-styled corporate terminator Jack Tilburn.
Also making a stand will be journalist Stephen Mayne who has put his name forward for election to the board.
The ASA's key concerns are AMP's ability to generate future profits and dividends, the GIO debacle, the need for more transparent reporting, questions over whether NAB made takeover overtures and Mr Batchelor's options package.
Mr Mather said: "I hope it will be a watershed meeting. AMP has gone through a very difficult period and I expect the changed management and board have taken on board the problems that have surfaced."
Mr Mayne, who rates his chance of success at 1 per cent, has his eyes set firmly on corporate accountability for AMP both as a listed company and as an institution investing in other listed companies.
"I was originally standing to try to bring further pressure to bear on Burgess and the board," Mr Mayne said. "Then they resigned. But having jumped through the hoops of AMP's hard nomination rules of needing 2,000 shares and being nominated by 25 shareholders, I decided to still stand.
"I believe institutions should become more active themselves at annual meetings and should improve the level of public debate and drive corporate responsibility.
"Jerry Ellis, for example, was appointed to the Pacifica board (last week). Why didn't the institutions vote against it? Ellis was responsible for $4 billion of losses at BHP Minerals. They (the institutions) just waved him through. What message is that for other directors?"
Mr Mayne said the resignation of half the AMP board went a long way to satisfying his concerns about the directors although he was troubled by Ian Renard being up for re-election, given his board seat on the State Bank of Victoria at the time of the Tricontinental fiasco and then again with AMP and GIO.
Mr Tilburn is angry at the appointment of Lord Killearn to the AMP board, saying he has 13 other directorships.
"AMP held 12 board meetings for calendar 1999 and I estimate 10 board meetings a year for the other 13 companies, giving an excruciatingly grand total of 142 board meetings and there are only 50 weeks by five days (250 days) available for this enormously overworked director," he said.
Ends
Bring Your Soap Box And Join The Queue
It is not often you get all three shareholders activists - Crikey, the voluble Jack Tilburn and someone from the ASA - at a meeting but it is likely to happen with AMP on Thursday.
Given that so many people will want to speak, Crikey will keep his contributions brief. Sadly, Jack will probably rant on for his usual 15 minutes of fame.
Stan Wallis is expected to run a pretty tight meeting and will protect individual directors from being dragged into specific exchanges about their election and their specific GIO culpability. However, we will all get about three minutes to talk about our good points and what we could do for the AMP.
Instos Don't Research Before Voting
Despite publishing a truckload of material on this website and the fact the notice of meeting went to all 1.2 million shareholders, I have still not heard from a single institution seeking any information about the nomination.
Obviously, I will come a long last and be very happy to get more than 20 per cent of the vote.
Former BHP chairman Jerry Ellis was elected to the Pacifica board last week with 99 per cent approval even after he was responsible for much of the $5 billion lost in the BHP Minerals division over the past three years.
Given that pathetic precedent, clearly none of AMP's institutional shareholders are going to give two hoots about the track record of Melbourne lawyer Ian Renard, the only one of the six candidates Crikey is recommending shareholders vote against.
In fact, AMP is Pacifica's second largest shareholder. Can you imagine if they had stood up at the Pacifica AGM and opposed the Jerry Ellis resolution. The reality is that Pacifica chairman Rus Fynemore, an old BHP mate of Jerry's, would never have tried this old boys appointment on if the possibility of some AMP action had been in the air.
Under Crikey's platform for an AMP board seat, AMP would have been at the Pacifica AGM arguing in the public arena about the perception problems associated with Jerry's appointment. Instead, the AMP and all the other institutions have effectively told the market and the broader community that it is acceptable to blow up $5 billion. Jerry's appointment sends exactly the same message as what Ian Burgess hanging around as AMP chairman after the GIO and George Trumbull payout debacles did. It says mediocrity is okay and you will not be held accountable for past failures.
Now that AMP has righted this wrong, they should go further and become far more active in the public arena when it comes to creating a culture of corporate accountability and shareholder pressure. Crikey will certainly keep doing that, but wouldn't it be nice having the authority of the good AMP name backing us up.
If you are a shareholder and have not voted yet, fax in the proxy form by 10am Tuesday morning to 1300 301 721.
In the mean time, get even angrier because AMP shares are back down to about $14.50. It is amazing to think that the NAB was offering $21 a share last November and did not even get chance to engage the AMP. Paul Batchelor was a key part of this strategy and should be quizzed about it at length on Thursday.
See you at the meeting in Melbourne on Thursday,
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