James Moore: McGrath shouldered too much blame in AIA row

Outlook So it's cheerio to Harvey McGrath. It is a mark of the way Prudential has conducted itself that he is probably not the worst occupant of the top seat in the life insurer's boardroom during the past few decades. The Ulsterman's tenure as chairman has hardly been a happy one, however.

Mr McGrath made his name in the hedge-fund industry, turning Man Group into the world's biggest quoted hedge-fund manager. But while life insurance and hedge funds may fall under the banner of financial services they couldn't be more different.

At Man, Mr McGrath oversaw numerous deals as chief executive and then chairman, which were largely waved through with little comment.

But even shareholders at one of the more anonymous members of the FTSE 100 tend to expect more than the "you'll just have to trust us, this deal is great" approach that he and his colleagues adopted when they asked them to stump up billions for the purchase of asian insurer AIA from the US government.

It therefore came as little surprise that the deal blew up in their faces. But Mr McGrath has carried the can rather than his chief executive Tidjane Thiam. This isn't entirely fair. Mr McGrath hardly played a blinder, but nor did Mr Thiam. And it was the latter who stoked their opposition's fires by trying to take a second job at a French bank while the bid was in progress (although Mr McGrath might have intervened).

Ulstermen are not renowned for their willingness to back down from a fight, but the writing was on the wall after nearly a quarter of shareholders failed to back him at the last AGM. That might not sound like a lot, but chairmen are accustomed to getting the sort of support that Kim Jong-un could expect were he to hold a vote on his prospective leadership of North Korea.

It is worth noting, however, that Mr McGrath has quietly reshaped Prudential's board, adding a number of heavy hitters as those who voted in favour of the disastrous AIA adventure have departed.

Mr McGrath has acted as something of a lightning rod for Mr Thiam over the past couple of years, despite the fact that the latter was equally culpable for the AIA failure. Helped by some good work put in by his predecessor Mark Tucker (now ironically running AIA) Mr Thiam has kept shareholders happy by turning in some good results. But there won't be any easy shelter for him the next time a storm hits his company. Nor should there be.