Shareholders must foot bill for tough times: FSU

Shareholders’ unwillingness to “take a hit” in tough economic times is almost solely responsible for a wave of offshoring plaguing the wealth management space, the Financial Services Union (FSU) believes.  

In the wake of Australian job cuts due to offshoring at AMP, FSU national secretary, Leon Carter, blamed the perpetual push for increased equity on investment for what he called an “offshoring epidemic”.  

“What we’re saying is offshoring is a choice,” he said.  

“The problem for us is that whilst (AMP) might have a reasonable argument from their perspective about why job losses have to occur, it’s the same line we hear right across our industry.” 

“What you’re saying is not that you don’t need the work done anymore, what you are saying is that you’d rather pay someone overseas rather than an Australian to do that work.” 

Carter said the drive for shareholder returns, in an industry that is always going to be profitable, is ultimately costing the Australian workforce.  

“I think people are fed up to the back teeth with this notion that the companies that essentially make money off the Australian community continue to wring their hands and get rid of jobs, all in the name of maximizing shareholder return,” he said.  

Commenting on AMP, Carter said beyond the 46 job losses due to offshoring announced earlier this month, the union has little further detail on what the final tally will be.  

He said while the company has followed the right processes, the union fundamentally opposes its reasoning for offshoring.  

“We are not manufacturing or cars that have to shut down ships or close doors to save themselves, AMP, regardless of how tight the economy is or how tight their bottom line would be, it continues to be an iconic and highly profitable organisation. 

“It seems to us that the only group in our community that doesn’t seem to be able to understand that the times are tough or take a hit are shareholders.” 

Carter said offshoring was rife across wealth management, with QBE, Suncorp and each of the Big Four, with the exception of the Commonwealth Bank, looking at incorporating it into their growth plans.