Kingspan’s founder, Eugene Murtagh’s fortune has gone up nearly a billion dollars in a year, but investors are moving away from the Grenfell Tower insulation supplier.
Forbes published its annual list of billionaires earlier this week with Kingspan founder and Chairman, Eugene Murtagh is on the list with a $2.4 billion fortune, up from $1.4 billion in 2020. He owns 16% of the shares in Kingspan, which he founded in Ireland in 1965.
Kingspan is the manufacturer of insulation materials used on Grenfell Tower. Kingspan executives appeared in front of the Grenfell Tower Inquiry through November and December 2020 and gave further evidence at the end of March 2021.
WHEB, a financial investor specialising in sustainable investing, published the minutes of its Investment Advisory Committee and revealed why it no longer invests in Kingspan.
“Our overriding concern is that there was, in our view, a culture within the UK operations that saw regulation as an impediment to doing business. There is clear evidence that senior leaders sought to manipulate tests to provide positive results. There is also evidence of management seeking to bully and threaten employees and put pressure on external consultants and clients who raised concerns.
“This core issue of culture remains, in our view, largely unaddressed by the company. Compounding this concern was the decision by the company to appoint the CEO’s brother to the Board. This appointment was announced with the annual results in late February. In our view, this was a missed opportunity to make board appointments which present the clearest possible signal of independent governance.”
Concluding its analysis, WHEB said that the cultural problems in Kingspan were “tacitly endorsed by group management” and that they did not believe that proposed remedies would go far enough to deal with these concerns.
As a result, WHEB sold all its financial interests in Kingspan by 26 February 2021, 0.11% of Kingspan’s outstanding equity.
WHEB is not the first investing firm to respond to the evidence provided at the Inquiry. In January, The Irish Times reported that Liontrust Asset Management had also cut its investment in Kingspan by about 400,000 shares.
The Mail on Sunday published its survey of ethical investment firms on 23 January and found many still held Kingspan shares but were reconsidering their positions. “Until late last year, the £2 billion Baillie Gifford Positive Change fund had Kingspan as a top ten holding, with 3.9 per cent of its assets in the company. But last month, it reduced this stake.”
The Grenfell Inquiry reconvenes on 19 April.