When Alexis George left big four banking to pick up the tainted and possibly poisoned chalice as AMP CEO from Francesco De Ferrari in early 2021, the task before her was described on the back page of the AFR as the “toughest job in Aussie business”.
But within the wealth management industry, many say the task of turning around Insignia Financial’s fortunes is just as difficult, maybe even harder. From March, that task will now fall to Scott Hartley, who will replace Renato Mota as Insignia CEO, the company confirmed to the market on Thursday.
Tipped as one of a handful of serious contenders for the role, Hartley is understood to have earned the support of activist investor John Wylie of Tanarra Capital and to have been the last external candidate in the race.
Hartley declined an interview, via an Insignia spokesperson, but in a statement to the ASX said: “I am honoured to be chosen to lead Insignia Financial and this transformational time as it builds upon its strong foundations to support Australians to achieve greater financial wellbeing… Insignia has an exciting future.”
The rosy sentiment obviously resonated with long-suffering investors – Insignia shares jumped by 3 per cent on Thursday – but while he has struck a notably positive tone upon which to commence his tenure, Hartley will be under no illusions about the challenges ahead.
In fact, he was reminded of it by former MLC and Perpetual CEO Geoff Lloyd, who was also rumoured to be a contender for the job. On Thursday, Lloyd took to LinkedIn to congratulate Hartley, adding: “Lots of wood to chop… but a great team and terrific clients”.
Hartley is at least experienced in complex turnaround attempts. He previously held the somewhat lofty and amorphous title of “Australia CEO” at AMP (effectively a deputy to George in charge of the domestic wealth management operations). While his boss was focused on the very public challenge of responding to a sexual harassment scandal and revolt by mostly female employees, Hartley was tasked with the ongoing challenge of rationalising and consolidating AMP’s ageing super and wealth products. He left AMP in May last year as part of a restructure.
It is highly relevant experience for running Insignia as it attempts to finally extract some “synergies” from the original IOOF’s monster acquisitions of MLC and ANZ Wealth and do something about the Insignia’s own mess of legacy product – although it would be fair to say AMP’s “transformation” is far from complete or assured.
Multiple industry sources, including some who have worked with and for Hartley, say he possesses several attributes that give him a shot of success. It is said that some within Insignia, especially those who came across in the MLC and ANZ deals, bristle at the dominance of the IOOF brand and culture. Hartley’s predecessor, Mota, was a proud “Odd Fellow”, having spent almost 20 years at IOOF and risen up its ranks.
By contrast, Hartley brings broad experience from across industry and retail funds. He also spent more than a decade within the MLC business, under both National Australia Bank and Lendlease ownership, giving him credibility with those who still might not be comfortable with the merger.
It is expected that Hartley will mostly remain based in Sydney, also helping to cement a new national identity for the Insignia brand as distinct from the intrinsically Victorian IOOF.
Others point to his general tenacity as a leader. Many sources described him as ambitious and driven, some went as far as to use the term “workaholic”. But while out of fashion in the contemporary discourse, that kind of work ethic will arguably be necessary.
Reading between the lines, Hartley seems to be broadly aligned to the company’s existing strategy. His references to “financial wellness” are right out of the Mota playbook. And sources said his time running Queensland fund Sunsuper (now part of Australian Retirement Trust) was marked by a passion for securing corporate and workplace super mandates, which Mota also identified as a potential growth business.
Under his watch, Sunsuper also gained fame for being friendly to external financial advisers. That reputation may come in handy as he takes the reins at the nation’s largest provider of advice.
But while Hartley will be incentivised to execute the board’s plan, turning around Insignia’s ailing share price and keeping the sprawling company whole, its very active shareholder register will be eager to extract value in whatever form they can. And this could mean a break-up of the conglomerate Mota fought so hard and spent billions to create.
One of many tough decisions facing the new Insignia CEO.