Pru drafting in directors to allay critics

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The Independent Online

Prudential is hoping to appease City criticism of its board with the appointment of two high-profile non-executive directors.

The UK's biggest life insurer is close to securing the services of the former regulator Sir Howard Davies, sources said yesterday, and is also in discussions with Paul Manduca, a former leading City fund manager.

Sir Howard, who is a director of the London School of Economics, spent six years running the Financial Services Authority (FSA) after its launch in 1997 and is also a former deputy governor of the Bank of England and former director general of the CBI.

Mr Manduca is being lined up as a replacement for James Ross, Pru's incumbent senior non-executive director. Mr Ross, who is 72 and has served six years on the board already, is widely expected to retire next year. Mr Manduca enjoyed a long career in the City, culminating in a stint as head of the European operation of Deutsche Asset Management. He also serves as senior independent director at the supermarket group Wm Morrison, but is due to step down in March.

The appointments are an attempt by Pru to address shareholders' concerns about the stewardship of the company. Tidjane Thiam, the chief executive, and Harvey McGrath, the chairman are seen as having been fortunate to survive a disastrous abortive bid for AIA, the Asian arm of the US insurer AIG.

Since the deal collapsed in June, Pru has released strong tradingfigures that have bolstered the duo's position. But the company's shares have performed worse than its rivals' and investors have continued to question the strength of its senior management.

Both Sir Howard and Mr Manduca, whose appointments would have to be cleared by the FSA, would be seen as significantly strengthening Pru's board, which has faced criticism for its failure to hold Mr Thiam and Mr McGrath to account.

Pru already has one vacancy on its board following the departure of Sir Win Bischoff a year ago to chair Lloyds Banking Group. However, other appointments to the board may yet be announced, with at least two other non-executive directors having already spent lengthy terms in office.

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