Alliance Trust chair quits at end of a convulsive year

Dundee-based Alliance Trust has announced that chair, Karin Forseke, will step down from its board on New Year’s Day.

The news comes at the end of a torrid year for the wealth manager as it attempts to overhaul its board governance structure in the wake of Spring’s shareholder insurrection.

Non-executive director Gregor Stewart will take over Ms Forseke’s role as interim chair while a replacement is found.

As part of the shift, Alastair Kerr, senior independent director, will step down from the board earlier than planned. Kerr had previously announced he would step down in May 2016, but will now leave at the start of January too.

Karl Sternberg will take the senior independent director role and will lead the search for a new chair.

Sternberg, a founding partner of Oxford Investment Partners, joined the board earlier this year following a public war of words between Alliance Trust and investor Elliott Advisors, an activist hedge fund.

Ms Forseke said: “We are making good progress implementing the changes announced in October to accelerate our long-term strategy and we expect the new governance structure to be in place in early 2016. Alongside the new non-executive only board of the Trust, excellent independent boards will be in place to oversee the development of Alliance Trust Investments and Alliance Trust Savings. As these changes are implemented, the Chair of the Trust’s role will change and as a result I believe now is the right time for me to move on.

“I feel privileged to have served this exceptional company over the past four years. The Trust’s focus on customers and commitment to sustainability in all parts of its business permeates the whole organisation and is at the heart of its strong values and culture. I also want to thank all our stakeholders for their support over the past four years and, in particular, the executive and employees of Alliance Trust who demonstrate the Trust’s values on a daily basis through their commitment and determination.”

Kerr said of his departure: “We have set out the strategy for Alliance Trust and I am confident that the new structure will allow it to flourish. I had planned to stand down in May 2016, but I feel that the new team should be responsible for identifying Karin’s successor, and standing down at this time will ensure a smooth transition.

“I would like to thank Karin for her hard work and dedication during her time as Chair. While it has been a challenging period, the Trust has generated a total shareholder return of 51%, well ahead of the MSCI All Country World Index total return of 43.4%. The Trust has undergone significant change under her leadership and is well-placed to continue to deliver returns for all its shareholders.”

Forseke’s departure comes as the board seeks to establish an independent board.

In September, Alliance Trust announced £6m of cost savings alongside a shakeup of the business.

The moves included changing the charging structure for the fund, appointing a management contract for the investment management of the trust and the creation of a new board for the investment division.

At the time Elliott Advisors said it would wait to see if the planned changes improved performance at the trust.