AMP Ltd (ASX: AMP) shares have been swimming against high tides for a while. The water got a bit rougher today as AMP shares fell by 6%.
AMP share price
New CEO faces big waves
As I highlighted in my previous article, AMP Capital has taken steps to bring in new CEO, Shawn Johnson.
This is a crucial first step to win back client trust because it signals that AMP’s board are looking towards new management to repair and restore reputational damage.
Johnson will likely need to draw upon his Navy experience to get through the rough waters ahead.
The first challenge for Johnson is finding replacements for key senior executives. And this is not an easy task as a lot of these departures played pivotal roles in building an outstanding track record over the years.
To add insult to injury, six asset management staff jumped across to Plenary Group.
My take on AMP
As the great Oracle of Omaha, Warren Buffet said, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that you’ll do things differently.”
Given the reputational damage caused by AMP’s financial planning and insurance arms, I can understand why it demerged AMP Private Markets.
However, the name and brand still exists and it will take a long time to restore its reputation.
In such circumstances, a lot has to go right in order for AMP to not only retain its existing clients but also attract new clients.
If AMP Capital struggles to attract talent, this could lead to poor investment performance, making it extra hard to grow.
I prefer to find businesses that are reliant on fewer things to go right to achieve outperformance.
If you’re on the hunt for ASX growth shares, I’d recommend signing up for a free Rask account to gain access to our stock reports.
