John Shrimpton, one of the founding partners of pioneering Vietnam investment company Dragon Capital, has resigned amidst a management reorganisation.

Dominic Scriven, co-founder, has been appointed chief executive, a newly created role.

Since its establishment in 1994, Dragon Capital has been a partnership led by six executive directors, including Scriven and Shrimpton, all of whom have been together for nearly the entire 15-plus years of the firm's history.

The firm now manages $1.5 billion across a variety of closed-end funds and principal investments, and is the biggest foreign investment company in Vietnam. It is also the only one to be entrusted with a domestic asset-management licence and is well regarded for its work in corporate governance and its extensive ties at all levels of government.

Dragon Capital's various closed-end funds and segregated portfolios invest in over 50 Vietnamese companies, and each year the firm pursues a theme related to management. In 2007, for example, it was executive compensation, and last year it focused on succession planning.

Most of the investee companies are the same age as Dragon Capital and are still run by the founders. But the environment has changed, stakeholders demand more, and when Dragon Capital spoke with these companies about planning and succession, it came to realise that it was in the same boat.

Last year, in the wake of the global financial crisis and the terrible stock-market crash in Vietnam, at the behest of its board of directors, the firm began to review its strategy and management. The 15th anniversary in 2009 also prompted navel-gazing.

The firm also ended 2009 on a sour note, with the Vietnamese government threatening to revoke the licence of an affiliate company, Tiberon Minerals, acquired by Dragon Capital in 2006 to develop a mine at Nui Phao.

The management review determined the firm needs to move, as Scriven puts it, from a 20th century management structure to one that fits the 21st century.

"In 2009 the markets globally recovered, leading to a perception of normality, but a lot of investors are thinking about the lessons learned, and we are no exception," Scriven says.

"Our situation has been that for the past 15 years, the same six people have been at the front of the company for almost the entire time," he adds. "But the business has changed; we have over 100 people working here. Vietnam has become bigger and more prominent, and our investors are raising the bar."

The first decision, taken in mid-December, was to create a CEO role, which Scriven took. Other corporate roles for operations and risk management are likely to follow. Scriven says Shrimpton did not want to participate in this new management structure.

Although Scriven says the management reorganisation has been under review for a year or so, this evidently has not been communicated to all of the firm's investors. One person who invests with the firm told AsianInvestor that the news of Shrimpton's departure, which was communicated to investors at the start of this week, came as a surprise.

Shrimpton could not be contacted for this story. He is reportedly in New Zealand, where he owns property, and has not revealed any future plans to his former colleagues.

Some outsiders familiar with Dragon Capital say Shrimpton was in fact ousted over the Tiburon deal, which he reportedly led. The firm acquired Tiburon to develop the Nui Phao mine for tungsten and fluorspar in the northern province of Thai Nguyen.

The project was meant to have gone live already but has suffered delays, including an inability to get enough financing. The delays angered the Thai Nguyen regional government. The federal Ministry of Environment and Natural Resources then told Tiburon it would revoke its licence for breach of compliance, but to date it has not done so.

Dragon Capital continues to work to secure financing and address other regulatory-related issues at Nui Phao.

Scriven says, however, there is no link between the problems at Nui Phao and Shrimpton's departure, arguing that "Dragon Capital is bigger and older than any individual investment".