Liontrust directors quit over chair’s 12-year tenure

Two non-executive directors have quit Liontrust over a row about the chair’s 12-year tenure on the board, just days after another dispute in the asset management industry over corporate governance.

The FTSE 250 fund group announced on Friday that Emma Howard Boyd and Quintin Price had stepped down immediately, without giving a reason for their departure.

However, people familiar with the situation said they decided to leave after warning that the chair’s length of service on the board flouted corporate governance rules.

The boardroom spat is the latest corporate governance clash in the fund management sector. Earlier this month, the Financial Times revealed that a non-executive chair of the £13.4bn Scottish Mortgage Investment Trust sounded the alarm over corporate governance, leading to a board reshuffle which will see the departure of chair Fiona McBain at the next annual general meeting.

Liontrust’s non-executive chair Alastair Barbour took on the role nearly four years ago. However, he has been on the board since April 2011, taking his tenure to 12 years. The UK’s corporate governance code recommends that chairs stay on the board for no longer than nine years, which starts when the chair first joins the board.

Barbour was re-elected as chair by the vast majority of shareholders last September. The decision to keep Barbour in the role comes after Liontrust made two acquisitions in quick succession and as the board underwent changes. One person close to the situation said it was important to keep Barbour as chair for continuity during this period.

The sudden departure of Howard Boyd and Price has prompted questions from investors. One institutional investor said it was “highly unusual” and “a red flag” that two governance-focused board members left at the same time with immediate effect. Liontrust, Howard Boyd and Price declined to comment.

Howard Boyd, who is a former chair of the Environment Agency, joined Liontrust’s board just over a year ago, last January. Price, who has long worked in the asset management industry, served on the board for less than two years.

Liontrust has also come under the spotlight recently over pay, after facing an investor revolt last year at the company’s general meeting over chief executive John Ions’ salary increase.

Under Ions, who took on the role in 2010, Liontrust has expanded the business through acquisitions. It bought Neptune Investment Management, the fund boutique founded by Robin Geffen, in 2019 for £40mn. Last year, it completed the acquisition of Majedie Asset Management for £120mn.

Liontrust, like other midsized asset managers, has come under pressure from turbulent markets, investor nervousness and pressure from low-cost tracker funds. Shares have dropped by more than a fifth over the past year.