After six years at the helm of GPT Group (ASX: GPT), Michael Cameron has been named CEO of Suncorp (ASX: SUN), replacing Patrick Snowball, who is returning to the UK.
Cameron has more than 30 years of financial sector experience, including senior roles at MLC, National Australian Bank (ASX: NAB) and Commonwealth Bank (ASX: CBA). Having also been a non-executive director of Suncorp since April 2012, he’s a good fit.
Unlike many of our corporate leaders, Cameron thinks a little differently, as his recent interview in the Australian Financial Review’s BOSS magazine suggests. The money quote:
'The key to a CEO in any industry or any sector is to drive further revenues, to be frugal in the way that you manage your expenses and to be very disciplined in the way that you manage your capital’ [emphasis added]'.
Almost every CEO might say that; very few actually do it. I’ve previously argued that those running BHP (ASX: BHP), Rio Tinto (ASX: RIO), Vale (BOVESPA: VALE5) and Fortescue Metals Group (ASX: FMG) should be managing all their assets – including their iron ore mines – to maximise shareholder returns rather than engage in mindless attempts to gain market share.
Since then, CEO Andrew Forrest has revealed Fortescue won’t proceed with expanding production by up to 35m tonnes. It’s a start, but the big four iron ore miners need to not only stop increasing production but start reducing current production if they hope to reduce the supply/demand imbalance and push up the iron ore price.
As for Cameron, at GPT he’s backed up his words with deeds. Taking over during the depths of the GFC, he successfully returned the company to the high quality, conservative business it once was before it embarked on a wild-eyed, ill-fated, pre-GFC expansion.
If you’re thinking of buying in, think again though. GPT is too expensive at current prices, as are most A-REITs. The rush to yield has pushed prices in the sector way above reasonable value.
Cameron’s tenure bodes well for Suncorp shareholders. While there are no guarantees, the combination of independent thinking and deep industry knowledge should prove integral to successfully managing Suncorp’s highly competitive insurance and banking businesses.
But before he begins his stint, perhaps he could call Sam Walsh and Andrew Mackenzie to try and talk some sense into them?
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