It has taken Old Mutual more than a year to announce the appointment of a permanent CEO to lead one of SA’s biggest life insurers, especially now, during choppy Covid-19 waters.
For most of this period, Old Mutual couldn’t appoint a permanent head because it was entangled in a highly publicised battle with its former CEO, Peter Moyo, who after being fired by the insurer on 18 June 2019 hauled it to court to be reinstated.
After two court victories against Moyo that blocked him from getting back his old job and office in Old Mutual’s swanky Sandton (Johannesburg) headquarters, the company has appointed Iain Williamson as the permanent CEO.
Williamson has been holding the fort as acting CEO since Moyo was first suspended on 23 May 2019 on the grounds of “a material breakdown in the relationship of trust and confidence” relating to his private investment firm NMT Capital. Old Mutual was a long-standing 20% shareholder in NMT.
To recap: Old Mutual accused Moyo of declaring ordinary share dividends that were linked to NMT— worth R105-million – at the firm’s board meeting on 4 July 2018, which he chaired. Of the total dividends declared (R105-million), Old Mutual said Moyo wrongfully pocketed dividends worth R30-million, while the insurer wasn’t paid preference share dividends, breaching its rights as an NMT shareholder.
Williamson’s immediate appointment was announced on Friday 3 July at 2:04 pm and by the end of the business day, his profile on Old Mutual’s website was changed to reflect his new job. Williamson is an Old Mutual insider; the life insurance general manager and actuary has been with the group for nearly 30 years in various roles at the insurer’s SA and London offices.
That Williamson helped steady the ship as acting CEO when Moyo was piling up lawsuits against Old Mutual and has been with the group for more than two decades made him the front-runner in the search for a permanent CEO, said an insider at the company.
After all, Old Mutual has a tradition of promoting individuals, who are mostly actuarial or accounting sciences graduates, from within the organisation to the CEO position. Underscoring this is that Moyo was with Old Mutual for more than 10 years before he was appointed as group CEO in 2017.
It is understood that Old Mutual short-listed more than five internal and external candidates, including Williamson, for the CEO position. The candidates were interviewed by a panel that ultimately recommended Williamson’s appointment to the board of directors and the chair, Trevor Manuel. The insider said Old Mutual had to expedite the hiring process because “the optics of not having a permanent CEO would be bad especially when the company’s profitability will be impacted by Covid-19 and the lockdown”.
Like the rest of SA’s insurance industry, Old Mutual has already warned that profits could be lower by at least 20% for the six months to June 2020 due to the lockdown, which began on 27 March. Old Mutual has sold fewer insurance products because its advisers – whose work relies on interfacing with customers in person – weren’t able to visit the homes and workplaces of customers because of physical distancing requirements.
Williamson’s new Old Mutual job might be short-lived. Moyo’s legal team previously said he plans to petition the Constitutional Court to get his old job back, saying he was dismissed unfairly and without being subjected to a disciplinary hearing. He wasn’t available at the weekend to comment.
At SA’s top court, Moyo wants to challenge a Supreme Court of Appeal ruling that dismissed his appeal against an earlier High Court ruling, which said he shouldn’t be reinstated to his old job. If Moyo emerges victorious at the Constitutional Court, it might put Old Mutual in an awkward position of reinstating a CEO that it no longer wants. DM/BM
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