AMP Limited (ASX: AMP) has faced a barrage of criticism over the last few weeks and months due to the revelations from the Royal Commission.
The wealth company has decided to appoint David Murray as its new Chairman. Mr Murray's name may be familiar to many readers as he has had an illustrious career in the finance sector.
He served as the Chief Executive Officer of Commonwealth Bank of Australia (ASX: CBA) from between 1992 to 2005. He was the CEO during the time when Commonwealth Bank changed from a partly privatised government bank to the bank we know today.
Mr Murray was also appointed as the first Chairman of the Australian Future Fund between 2006 and 2012.
Readers may recognise the Murray name from the Murray Inquiry into the Financial System from a few years ago.
According to AMP, Mr Murray will lead the redevelopment of governance processes at the company, including Board renewal and an additional Non-Executive Director.
Mr Murray commented saying "AMP employs almost 6,000 people many of whom are Australians serving its customers across wealth management, superannuation, financial advice, life insurance, asset management and banking. It is a significant financial institution and needs to play a role within the Australian financial system which supports the building of trust and confidence in that system in the community. I look forward to working with the Board and executive management to support AMP's people in achieving that outcome."
"As part of this, I am committed to meaningful board renewal but recognise the process must be measured so as to maintain the stability of AMP in the immediate future. Restoring trust and confidence is not easy and does not happen overnight, but I am confident this can be achieved.
Is AMP a buy?
Hold your horses on that thought. But, I think it would take a man of Mr Murray's calibre and integrity to turn AMP around. AMP has been based in Australia which is having the longest economic boom in history, yet it has not managed to achieve growth for shareholders. Australia's superannuation system is one of the best retirement systems in the world, yet AMP was not able to sustainably work with its clients to get the best outcome for both parties according to what we've heard from the Royal Commission.
However, if David Murray can turn into a well-liked financial business such as Challenger Ltd (ASX: CGF) then it could yet turn into a happy ending for shareholders of the beleaguered financial company.
