Britam #ticker:BRIT rejected the push to hire an insider to replace Benson Wairegi as managing director following a decision that reflected the wishes of its dominant foreign shareholders.
The financial services company said the decision to appoint Zimbabwean Tavaziva Madzinga to replace the company’s long serving managing director was driven by shifts of its ownership structure.
Britam was expected to tap an insider from the finance division to replace Mr Wairegi, who retired in January after serving the firms for 40 years.
The changes in the executive suite came in a period when series of share dealings saw local owners of the firms including tycoons– Jimnah Mbaru and Peter Munga—cede control to foreigners like Swiss Re, AfricInvest and International Finance Corporation (IFC).
“As you know Britam Group has a rich and diverse shareholding base and the Board had to arrive at a decision that as much as possible balances the interests of the different shareholders,” Britam said in response to a shareholder who asked why the board did not hire an insider.
The response is contained in a transcript made public by the firm after its virtual annual general meeting (AGM).
Local shareholders owned 58.9 percent of Britam when it listed in 2011, but that has been reduced to 42.8 percent as at June. But the foreign owners now account for 43.9 percent of the top 10 shareholders, who ideally control the board, from 23.9 percent in 2011.
Mr Madzinga, an actuarial scientist, previously served as chief executive of Old Mutual’s operation in Kenya.
The Zimbabwean is credited with successfully developing, driving and executing Old Mutual’s strategy in Southern and East Africa as well as helping to transform Swiss Re’s insurance and savings business in the UK and Ireland. Since he came on board, the new boss has undertaken a massive restructuring that has seen the company shed an estimated 138 jobs at a cost of up to Sh700 million.
A consultant hired by the company said there are too many managers and reporting layers which saw the firm eliminate nine top executive positions or nearly half of its management team.
The new CEO made changes at the Nairobi bourse-listed firm introducing a leaner team of 11 managers from the previous 19.Britam Holdings however still posted a record net loss of Sh9.1 billion in the year ended December 2020 from a net profit of Sh3.5 billion a year earlier when its asset management division underperformed.
