It was announced this morning that Katherine Garrett-Cox is to leave Alliance Trust. She had previously been demoted to be Chief Executive of its subsidiary, Alliance Trust Investments, but now she is departing altogether in one month’s time.
Despite the eulogies in the announcement on her contribution to the Trust over the past nine years it seems unlikely that many shareholders will regret her departure. Those 9 years have not been great ones for the Trust in terms of investment performance, leading to disillusionment among their many long-standing and typically conservative private investors.
She has been accused of empire building by investing large sums to make Alliance Trust Investments (ATI) an independent investment business rather than just looking after the Trust’s portfolio. In addition she has tried to turn Alliance Trust Savings (ATS) into a savings platform to compete with the giants in that sector. Neither have yet to show they can be profitable or provide a return on the investment made.
Her somewhat flamboyant style and high pay seemed to conflict with the traditional ethos of a company based in Dundee, but at least shareholders of Alliance will be relieved of the cost of her attending such events as Davos to hobnob with the great and good in future.
As this morning’s announcement indicates, the new board of directors seems to be moving swiftly to implement changes in the Trust. Long suffering shareholders will surely welcome that at the forthcoming AGM of the company in May. But the future of ATI and ATS, and how the costs of running them is accounted for, is not yet clear.
More information on past events at Alliance Trust and the campaign to achieve some reforms is present here: http://www.sharesoc.org/alliance.html