GENEVA – The chairman of the Zurich Insurance Group abruptly resigned Thursday over the apparent suicide of its chief financial officer, claiming he wants to avoid damaging the company’s reputation.
Josef Ackermann, who is Swiss and a former CEO of Deutsche Bank, Germany’s largest, said in a company statement that he was resigning because he believed the undisclosed accusations levelled against him by the family of deceased CFO Pierre Wauthier could hurt Zurich, a major insurance provider that employs about 60,000 people in more than 170 countries.
A day after Wauthier’s death, Swiss police said Tuesday that he appeared to have taken his own life. He was found dead in his home in the wealthy lakefront community of Zug, just outside Zurich.
Ackermann said the family believes he bears some responsibility for the death.
“The unexpected death of Pierre Wauthier has deeply shocked me,” Ackermann was quoted as saying in the company statement. “I have reasons to believe that the family is of the opinion that I should take my share of responsibility, as unfounded as any allegations might be.”
“As a consequence, I see the possibility of a continued successful board leadership to the benefit of Zurich called into question,” he continued. “To avoid any damage to Zurich’s reputation, I have decided to resign from all my board functions with immediate effect.”
The death of Wauthier comes just five weeks after Switzerland’s leading telecommunications company Swisscom said its 49-year-old chief executive Carsten Schloter took his own life.
Wauthier, who was 53 and a citizen of both the U.K and France, joined Zurich 17 years ago and was appointed CFO in 2011. Before that he had worked at JP Morgan’s investment bank and the French foreign ministry.
Ackermann, who left Deutsche Bank only last year to return to Switzerland, and Wauthier presided over the finances of a company during a challenging time. Two weeks before Wauthier’s death the company said it was struggling to meet its targets: It posted an 18 per cent drop in quarterly profits. And in the past year, some top managers have left the company.
The board’s vice chairman, Tom de Swaan, is taking over as acting chairman of Zurich,
Ackermann headed Zurich for little more than a year. He had spent more than a decade at Deutsche Bank, where he headed the investment banking division before becoming its CEO in 2002. His 10-year tenure in the top job was marked by ambitious profit goals and an increased focus on international investment banking, and he led the bank through the global financial crisis.
The bank wasn’t directly bailed out by the government but Deutsche Bank was a recipient of the U.S. government’s massive bailout of failed insurer AIG. His tenure also included legal troubles, some of which still plague his successors.
Ackermann was put on trial on charges of breach of trust in connection with large bonus payments made to executives at telecommunication firm Mannesmann, where he served on the board. Mannesman’s CEO, board chair and other officials got 57 million euros ($76 million) in bonuses after they accepted a hostile takeover by Britain’s Vodafone in 2000.
The size of the bonuses drew negative public comment in Germany, where large executive pay packages and “golden parachute” exit bonuses are less common than in Britain or the U.S. He and his defenders argued that big bonuses represented incentives for actions that also benefited shareholders.
However, Ackermann was additionally regarded to have made a public relations gaffe by flashing the V for victory sign before his first court appearance. He was acquitted in 2004 and but retried after prosecutors appealed. The second trial was halted in 2006 after he agreed to make 3.2 million euros in public and charitable payments.
Since Ackermann left Deutsche Bank in May 2012, the company has had to set aside increasing amounts of money to pay for lawsuits and investigations, some dating to the Ackermann era. Those include alleged manipulation of interest rate benchmarks and lawsuits over mortgage backed securities the bank underwrote, or issued, in the U.S. Deutsche Bank said it has found no evidence that current or former top managers engaged in wrongdoing in the interest rate scandal.