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Experience of corporate debacles suggests it is not in shareholders'interests to force wholesale resignations of senior management and the board. So if shareholders force Pahari out the door,De Ferrari is probably safe.
The board commissioned the QC’s report and was therefore fully apprised of the allegations and Pahari’s admissions to what AMP describes as lower level breaches of conduct codes. But the decision to keep him has painted the board and De Ferarri into a corner.
How can AMP ask Pahari to resign now when,having had all the facts two years ago,it allowed him to remain with the company and ultimately promoted him? If the board asks him to resign now this would be a costly exercise and small shareholders,in particular,would be incensed about paying out an executive whose behaviour is allegedly questionable.
It would be a very bad look.
Thus AMP directors have tied their fate to that of Pahari.
On Wednesday AMP promised to make the eight-page report into the allegations public but only after Allan Gray had exerted persistent pressure. And given AMP can’t selectively disclose to one shareholder it has been forced to make the report’s findings public.
To date the version of events provided has been through the AMP sanitation sieve. The company’s rendition says in effect"nothing to see here".
On Sunday a frustrated Szlakowski provided the media with her version of events. Fair to say of her allegations"plenty to see here".
According to media reports over the past week,Murray told shareholders that around half of Szlakowski’s allegations were substantiated.
The bigger question is why AMP is not sufficiently enlightened to employ a zero tolerance policy on harassment of any kind. Its reasons for imposing a financial punishment on Pahari rather than calling for his resignation appear to be more financial.
When the report’s findings are ultimately released AMP directors had better be wearing their flak jackets.
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