A RESTRUCTURE of QBE Insurance's local operations has triggered the exit of a top executive long regarded as a key candidate to take charge of the global insurance giant from its present boss, Frank O'Halloran.
QBE last night issued a statement that said Vince McLenaghan had left the company to pursue other interests, but was not specific.
The exit of Mr McLenaghan puts the succession issue back on the agenda for QBE, where Frank O'Halloran has ruled for 13 years.
Mr O'Halloran has not detailed retirement plans but Mr McLenaghan and a second executive, Steven Burns, the head of the company's European arm, had both been seen as the front-runners to take charge.
However, more recently QBE's global head of underwriting, John Neal, has emerged as a market favourite to assume the top spot. Most QBE watchers expect an insider to eventually take over from Mr O'Halloran, given the complexity of QBE's operations, which now span 49 countries.
A 27-year veteran of QBE, Mr McLenaghan had been shuffled around to key positions in its global empire for much of the past decade to gain crucial experience. At one stage Mr McLenaghan served as QBE's chief operating officer, running the day-to-day business of the insurance giant.
Most recently, he headed up QBE's combined Australian and Asian unit, which had operations in 18 countries, more than 5600 staff and insurance income of about $4.7 billion.
However, the region has since lost its prominence, with much of the growth for the company occurring in the US, where QBE had rapidly increased its exposure to the market through a string of large acquisitions.
A restructure announced late last year also suggested Mr McLenaghan's rise inside the firm was not regarded as a certainty after a global shake-up resulted in several key executives no longer reporting to him.
Last night QBE detailed plans split its Australia Asia-Pacific business into two, citing the rapid growth of its operations in the region.
Under the change, QBE will have an Australian operation and an Asia-Pacific operation headed by separate chief executives. Colin Fagen will emerge as the chief executive of the Australian business, and Michael Goodwin will remain in his role of Asia-Pacific chief executive.
The split of the business was designed to maximise opportunities and improve decision making over QBE's operations that straddle the two regions, it said in a statement.
"The changes to the management structure of our Australia Asia-Pacific operations reflect the natural progression of these successful businesses to a more independent future," Mr O'Halloran said last night.
In April QBE's chairman, Belinda Hutchinson, batted off questions about Mr O'Halloran's retirement plans at the group's annual meeting.
"He looks hale and hearty to me and he doesn't look as though he is going anywhere," she told shareholders at the time.
Frequently Asked Questions about this Article…
Why did a key QBE executive, Vince McLenaghan, leave the company?
According to QBE's statement in the article, Vince McLenaghan left to "pursue other interests." The departure followed a restructure of QBE's local operations; the company did not provide further specifics about his exit.
Who is Vince McLenaghan and what roles did he hold at QBE?
Vince McLenaghan was a 27-year QBE veteran who served in several senior roles, including chief operating officer. Most recently he led QBE's combined Australian and Asian unit, which operated in 18 countries, employed more than 5,600 staff and generated about $4.7 billion of insurance income.
What did QBE's restructure of its Australia and Asia-Pacific operations involve?
QBE announced it would split its Australia Asia‑Pacific business into two separate operations—an Australian business and an Asia‑Pacific business—each led by its own chief executive. The company said the split was designed to maximise opportunities and improve decision making across the two regions.
Who will lead QBE's Australian and Asia‑Pacific businesses after the split?
The article says Colin Fagen will become chief executive of QBE's Australian business, while Michael Goodwin will remain in his role as chief executive of the Asia‑Pacific business.
How does Vince McLenaghan's departure affect QBE's succession plans for the group CEO role?
The article notes McLenaghan's exit puts the succession issue back on the agenda. Frank O'Halloran has been group CEO for 13 years; McLenaghan and Steven Burns had been seen as front‑runners previously, while John Neal (global head of underwriting) has more recently emerged as a market favourite to succeed him.
How large is QBE's global footprint and where is the company's growth coming from?
Per the article, QBE operates across 49 countries. It also notes that much of the company's recent growth has come in the United States, where QBE increased its exposure through a series of large acquisitions.
What reason did QBE give for splitting the Australia and Asia‑Pacific operations?
QBE said the split was intended to "maximise opportunities and improve decision making" for operations that straddle the two regions. Frank O'Halloran described the change as reflecting the natural progression of those businesses to a more independent future.
What did QBE's chairman say about CEO Frank O'Halloran's retirement plans?
At the group's annual meeting in April, QBE chairman Belinda Hutchinson dismissed questions about O'Halloran's retirement plans, saying he "looks hale and hearty" and "doesn't look as though he is going anywhere."
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