Francesco De Ferrari is feeling the heat from his biggest shareholders over a second case of harassment at the Australian wealth boutique he jumped ship from Credit Suisse to run.
The Swiss banker's troubles in reviving AMP, a Sydney-based wealth manager, show no signs of letting up. Francesco De Ferrari last week abruptly lost one of his longest-standing lieutenants, and now faces renewed fallout from a 2018 case involving another top executive at AMP.
AMP's biggest shareholder, Harris Associates, said it would «engage aggressively» with De Ferrari as well as AMP's board under Chairman David Murray, according to «Australian Financial Review» (behind paywall). The U.S.-based fund is angry about De Ferrari promoting Boe Pahari to a top management role despite a sexual harassment sanction two years ago.
Pattern Of Harassment
Harris, also the largest shareholder in Credit Suisse, where De Ferrari used to oversee wealth management in Asia, appears to have marshaled AMP's second-largest investor as well. Allan Gray, which holds seven percent of AMP, met with both De Ferrari as well as Murray in recent weeks after the details of Pahari's behavior emerged in an «AFR» media report, the outlet reported.
It published details from the AMP staffer harassed by Pahari, who paid a A$500,000 ($360,000) fine as part of the sanction. Her account includes lurid details alleging that Pahari repeatedly overstepped professional boundaries in harassing her, and encouraging her to communicate covertly to avoid AMP's detection.
Lewd Photos At Work
Harris and Gray, the investors, both slammed the behavior and said it raises questions over AMP's leadership. The Aussie outlet reported that the shareholders are weighing an extraordinary shareholder meeting, to potentially eject Murray, the chairman. De Ferrari's recovery plan for AMP doesn't appear to be objectionable to the investors.
The dispute undermines De Ferrari's acumen at picking leaders in his six-person management – it comes shortly after the CEO's long-time associate, Alex Wade, left AMP amid reports he had sent lewd photos to one or more staffers as well as conducted himself poorly in other ways.
Recovery In Train
It also represents an entirely different kind of setback than what De Ferrari will have expected: he was brought in two years ago to repair AMP following a scandal over misleading customers and lying to its regulator, and to stanch an asset bleed.
As it works its way through a client remediation program set to wrap next year, AMP last week said it swung to a A$203 million profit in the first half, from a A$2.29 billion loss year ago. Last month, De Ferrari was able to wrap a A$3 billion life insurance disposal to Resolution Life, a rival.
