London calling AMP NZ chief after local shake-up

By Richard Braddell

WELLINGTON - Before AMP's New Zealand chief executive, Rodney Cook, came to New Zealand three years ago, he was told by the group's managing director, George Trumbull, that if he did well he would be sent somewhere else. If he didn't, he would be sent somewhere else as well.

Mr Cook had no problem with Mr Trumbull's instructions. They were clear and they were consistent with policy in which AMP outlines clear career path expectations for its top 200 executives.

In the event, Mr Cook will soon leave for AMP's most far flung outpost - London - to take charge of AMP UK. The position will give Mr Cook influence, but not direct control, over more than half of the group's assets.

Since the chief managers of Pearl, Henderson Asset Management, London Life, National Provident and half-owned Virgin Direct report directly to Mr Trumbull, Mr Cook will have to exercise diplomacy in carrying out his task of encouraging the business units to take advantage of synergies such as the present move to concentrate all British asset management in fund manager Henderson.

Mr Cook will also have a weather eye for acquisitions on top of those that have already transformed AMP into one of Britain's top five life and funds management groups.

His three years in New Zealand suggest he has the credentials. Having been through a demutualisation, he will bring experience to the demutualisation of National Provident Institution which later this year will add œ13.5 billion ($40.5 billion) to AMP's British assets.

In Mr Cook's three years in New Zealand he has rebuilt AMP from the bottom up with rejuvenated product lines which can now be bought by customers from any of a number of distribution channels over the phone. This week, for example, AMP began selling general insurance over the Internet.

One of the major shifts in AMP's thinking was to allow independent brokers to sell AMP products while the group's own tied agency force has been retrained as financial advisers. AMP was so concerned at the standard of industry training that it set up its own NZQA recognised training scheme that has been completed by 85 per cent of advisers.

But in the public eye, one of the most noticeable developments, aside from demutualisation, has been the opening of the direct bank, Ergo, which now has $2 billion in lending on its books. Ergo will be relaunched in the middle of the year as the New Zealand branch of AMP Banking.

Underpinning everything has been a rejuvenation of the public's perception of what Mr Cook refers to as Mother Amicus, the statue that for 140 years was a feature of AMP's branding.

When he took over, customer surveys were telling AMP that it was regarded as big, strong and secure, descriptors that Mr Cook could happily live with. Less palatable were perceptions that AMP was a stodgy, slow moving insurance company.

Mr Cook is pleased that in the same surveys people are now recognising that AMP is changing and is successful. And success breeds success.

However, another prong in AMP's strategy differs considerably from some of its financial sector rivals who are centralising more activities at head office in Australia.

Mr Cook is quite happy that AMP's centre of gravity has remained in New Zealand. The New Zealand fund management has been expanded, advertising is developed in New Zealand and information technology is run from here rather than Australia.

AMP New Zealand may be a part of the Australasian group, but with 400,000 customers AMP is big enough to manage the fixed costs that will force some of its smaller rivals out of the market.

"The guts is that New Zealand is a great place to pilot new things for the benefit of the group," Mr Cook says.

If there is one thing that has not gone to Mr Cook's satisfaction during his time in New Zealand, it is superannuation. A member of the Task Force 2000, he will remain so once in Europe, making his contribution by fax, e-mail and phone.

"The thing that excites me about the task force is that each of the [task force] groups that have gone before us have been asking, can the country fiscally afford NZ Super as we know it? We are using a blank piece of paper and asking how can we provide for our aging population," Mr Cook says.

As such, the task force is also looking at provision of future health and retirement needs, an approach that Mr Cook hopes will produce outcomes that sail past the rocks on which the superannuation referendum foundered.

To do so, Mr Cook says New Zealand will have to come up with a solution that ensures that those reaching retirement who have no time to plan for themselves will get the benefits they had planned on while the younger people who accept that they will have to take care of themselves get a clear message.