Old tricks at Mutual

2009-09-26 12:47

LABOUR department director-general Jimmy Manyi is planning to grill London-listed life insurer Old Mutual Plc over the restructuring of Kuseni Dlamini’s job.

Dlamini is the first black executive to head the group’s South African operations since its inception 164 years ago.

Manyi has been forced to show his hand after eyebrows were raised about the alteration of Dlamini’s ­reporting lines.

Dlamini, who took over as managing director of Old Mutual South Africa (OMSA) early this month, reports to Paul Hanratty, Old Mutual Plc’s new head of the long-term savings division, instead of reporting to Julian Roberts, the chief executive of Old Mutual Plc.

When Hanratty headhunted Dlamini from Anglo American, he was the supremo at OMSA and ­reported directly to Roberts.

Manyi said: “I am very disappointed with what appears to be a second-guessing of a seasoned black executive like Kuseni. Kuseni has more responsibilities than Paul used to have. Kuseni should be reporting directly to the chief executive (Roberts) of Old Mutual Plc.

“We will ask for an urgent meeting with Old Mutual Plc to seek clarity.”

A prominent member of the Black Management Forum said he viewed the change in Dlamini’s reporting lines as Hanratty’s way of running OMSA from his London office.

“Who was Paul reporting to ­before Kuseni was appointed? If the answer is Julian Roberts why have they changed the reporting lines now?” said the BMF member, who asked to remain ­anonymous.

“If they had appointed a white person to the job the reporting lines would have remained the same.”

Besides running the South African business, Dlamini is also responsible for handling the emerging market portfolio, which encompasses the rest of Africa, Latin America, and Asia. This portfolio was previously never part Hanratty’s job when he was the managing director of OMSA.

Esme Arendse, the spokesperson for OMSA, said there was nothing sinister about changing Dlamini’s reporting lines as they were in line with Old Mutual’s new strategic ­approach.

“One of the key conclusions of the group’s strategic review, as ­announced in March, was to bring all the group’s long-term savings businesses into a single operating structure to unlock value through closer collaboration,” she said.

“Therefore Skandia, OMSA, and US Life were grouped together into a single long-term savings division under the leadership of Paul Hanratty, who was appointed chief executive for long-term savings.”

This means Dlamini and Jonas Jonsson, the chief executive of Skandia European Retail; Bob Head, the chief executive of Skandia Wealth Management; Bertil Hult, the chief executive of Skandia Nordic and Christopher Chapman, the chief executive of Old Mutual US Life will all report to Hanratty.

In his first few days as OMSA boss the showdown with Manyi will not be Dlamini’s only concern. He still has to retain top executives who may be considering leaving the company after missing out to him.

The appointment of chief executives is usually followed by a departure of some executives who may have fancied the job.

When Maria Ramos moved from Transnet to become chief executive of Absa earlier this year Peter Mageza, the chief operating officer, left and Jacques Schindehutte, the finance ­director, has indicated that he will leave at the end of February.

At Nedbank internal candidate Mike Brown has already seen his former retail banking colleague Rob Shuter depart for Vodacom. Shuter left after losing out on the Nedbank top job.

At Old Mutual Thabo Dloti, the chief executive of Old Mutual Investment Group, and Ralph Mupita, the head of Old Mutual Unit Trusts, were both interviewed for the top job. They are among the executives rumoured to be also planning their departures.

An OMSA employee who declined to be identified said black executives were unlikely to get the position in the first place and that Mike Harper, the managing director of Retail Affluent and Corporate, was the only one who had a realistic chance of clinching the job.

“We all expected that Mike Harper was going to get the job because he is an excellent manager and the business that he runs contributes more than 60% to OMSA profits. But I think the colour of his skin counted against him,” the employee said.

The employee said Dlamini’s appointment initially came as a surprise but was understandable.

“If you look at his overall leadership skills and experience, he is a better candidate for the job than the black internal candidates who wanted the position. Dlamini has experience in dealing with trade ­unions and the government.”

Arendse said Dlamini enjoys the support of his entire executive management team.

“In the South African context, they are particularly proud that the company has appointed Dlamini,” she said.

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