The AMP Limited (ASX: AMP) share price dipped 4.17 % on Monday as questions arose over its defence of a top executive accused of serious sexual harassment.
Boe Pahari faced the allegations from a female subordinate in 2017. But he was promoted to the position of AMP Capital chief executive officer after the company found his offence was “low level”.
AMP had also defended the promotion, saying a financial penalty was sufficient and that Pahari had expressed remorse.
But Nine this week published explosive details of the allegations against Pahari, which seemed to contradict the company’s insistence that the harassment was on the lower end of the scale.
The details of the allegations included Pahari sending the employee on an unnecessary trip to London, saying she made him look like a “limp dick” when she refused his offer to buy her clothing, extending the hotel stay against her wishes and requesting they message each other on Whatsapp to avoid detection.
The $500,000 fine imposed on Pahari was reportedly the same amount AMP settled for with the employee, who departed the company.
Investors have called for AMP to stand down Pahari.
The Australian Council of Superannuation Investors (ACSI) is a lobby group that represents 38 asset owners and institutional investors, who collectively own 10% of every ASX200 company.
ACSI chief executive Louise Davidson told Nine that she couldn’t see how Pahari’s position is tenable.
“It concerns me particularly that the company has tried to downplay the seriousness of the [alleged] sexual harassment.”
The Motley Fool has contacted AMP and ACSI for comment.
ACSI reportedly has discussed the issue with AMP since the case first went public earlier this year.
But Davidson said the response from the company has been inadequate.
“It’s not clear to me what the next steps are aside from just sitting tight and hoping it goes away.”
And it seems many other investors feel the same way, selling off AMP’s shares en masse on Monday. The AMP share price closed at $1.50 yesterday, falling from $5.43 in March 2018. It has continued to slide today, falling another 1.54% to $1.47 at the time of writing.
Pahari’s behaviour wasn’t the only harassment scandal the finance giant has dealt with in recent times.
AMP Australia chief executive Alex Wade resigned earlier this month after serving less than a year in the position. He faced accusations he sent photos of a sexual nature.
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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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