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Business News

RSA still on the hunt for a new chief executive

Royal & SunAlliance will today admit it has not yet found a new chief executive to lead the stricken insurer at a crucial time, when the City is waiting to see whether it can persuade investors it has a viable future as an independent company.

RSA will say it has no update on the chief executive role as it unveils its much-awaited strategy for dealing with its severe lack of capital and hefty liabilities from asbestosis claims.

The group has been searching for a new chief executive to replace Bob Mendelsohn, who stood down from the top job in early September, following increasing protests from shareholders about the company's performance.

Since Mr Mendelsohn departed, RSA is understood to have contacted at least two external candidates for the chief executive position who have turned it down.

Bob Gunn, the insurer's respected chief operating officer who stepped in as the temporary chief executive, is thought not to want the job permanently.

RSA has said it is still looking for a chief executive, a process which can take months for a major company. But observers say the insurer is finding it difficult to identify someone who is both capable of doing the job and willing to take it on.

Names which were in the frame for the job included Patrick Snowball, head of Norwich Union Insurance, and Mark Wood, head of the UK arm of Prudential. Both have made it clear they do not want the job. Ian Chippendale, executive chairman of Direct Line, and Steve Clarke, that company's finance director until July, have also been mentioned.

RSA has already sold off businesses worth nearly £800m to boost its capital. It has said it wants to make more disposals but will not be able to produce hard evidence of that plan today. It is likely to identify businesses it wants to hive off, but has not yet agreed the deals. These may include RSA's under-performing Canadian business and its Danish insurance arm, Codan.

RSA may also reduce or sell off its UK motor insurance business, which has not produced a decent return for shareholders for years.