Argo Group shareholder Voce Capital Management is upping its pressure against the company, accusing it of failing to address any recent concerns raised about the alleged corporate excesses under CEO Mark Watson III and the current board.

Voce has also disclosed its nominations for independent board members who it asserts will address those excesses, which it said range from an extravagant corporate art collection to pricy real estate and luxury home/corporate jet travel for Watson.

“Voce believes that Argo’s current board is directly responsible for the company’s wasteful, spendthrift culture, and that its failure to check the impulses and profligacies of the CEO reveals a complete corporate governance shipwreck,” Voce said in a March 8 statement. “The Board’s shortcomings result from its lack of independence, dearth of relevant experience and misalignment with shareholders – deep-rooted issues that can only be addressed by the addition of fresh perspectives brought by independent directors nominated by shareholders, not management.”

Voce added that since it publicly raised its concerns two weeks ago, Argo allegedly “has failed to meaningfully address a single one of the many examples of misuse of corporate assets that we painstakingly researched and chronicled.”

Argo Group issued its own statement asserting that it continues to do plenty to grow and improve the Bermuda-based specialty insurer and reinsurer for the benefit of customers and shareholders alike.

“While [Voce] continues to disseminate and publish ad hominem attacks, our directors and management team are focused on executing a compelling long-term, value-enhancing strategy,” Argo said in its remarks. “We are deliberate in our mission to deliver top-performing underwriting businesses and we continue to be keenly focused on driving efficiencies, as evidenced by the reduction of 260 basis points in our expense ratio in 2018.”

Argo added that its board is “highly capable and engaged,” with “deep industry expertise

and company-specific skillset, focused on risk management, insurance operations, financial oversight, technology, distribution and corporate governance.”

The company said its nomination process for the board helps refresh the company’s governing body regularly, helping to bring five new independent directors in the past two years.

“Each of these independent directors [already at Argo] has brought and demonstrated proven skillsets to help enhance and propel forward Argo’s strategic plan,” Argo said.

Here are Voce’s nominations of independent candidates to Argo’s board of directors:

• Bernard Bailey. He’s president of the Committee for Economic Development, a former leader of companies including Authentix and Viisage, and a board member or former board member of companies including Telos, Analogic and Egis Capital Partners.
• Charles Dangelo. He has previously held senior executive and director roles at subsidiaries of Start Companies. He began his career at CNA Insurance.
• Rear Admiral (ret) Kathleen Dussault. She served in a number of leadership roles during 34 years with the U.S. Navy, and was a senior executive at USAA.
• Carol McFate. She is a former chief investment officer for Xerox Corp., and an ex-executive from companies including XL Capital, AIG and The Prudential Insurance Company of America.
• Nicholas Walsh. He’s a director at Jardine Lloyd Thompson Group PLC, and a former director or board member at various divisions of AIG. As well, he was a director at Lloyd’s syndicate Ascot Underwriting Ltd, among other board positions.

Sources: Voce Capital Management, Argo Group International Holdings