QBE CEO John Neal has been forced to step down from the job amid a shareholder revolt over a series of profit downgrades and a scandal over a relationship with a company secretary.
The global insurance giant announced Neal will step down on January 1 after five turbulent years in charge to be replaced by CFO Pat Regan.
Neal inherited a highly complex $16 billion business following decades of questionable acquisitions up to 2007 and he was forced to slash the value of many of the more than 100 businesses QBE acquired during its aggressive growth strategy.
He delivered eight profit downgrades in his tenure, and the latest was in June of this year and since then QBE shares have plummeted almost 25 per cent.
Earlier this year, Neal had his short-term bonus cut by $550,000 after he failed to notify the board of a personal relationship with another employee. He was punished for not informing the board in a timely manner of the relationship.
"John (Neal) has led the business through a significant transformation and a challenging period in the insurance industry globally and has been working closely with the board to ensure a smooth transition for his succession," says QBE chairman Marty Becker.
In a statement to the ASX, QBE says it has been carrying out a detailed succession plan for the past two years and has reviewed internal and external candidates for the role of CEO to replace John Neal.
Pat Regan joined QBE in 2014 as group chief financial officer and was appointed to the role of CEO, Australian and New Zealand operations in August 2016. Prior to that he was CFO at Aviva in London.
Regan's base salary will be $2 million with a 233 per cent incentive award on top of that which can rise to 350 per cent in the event of "outperformance". This means he can earn up to $9 million with 20 per cent in cash and 80 per cent in shares.
Business News Australia
Get our daily business news
Sign up to our free email news updates.