The chief executive of Alliance Trust Investments is exiting the firm after it was “mutually agreed” she would step down.

Katherine Garrett-Cox, who was paid £1.4m last year, will leave the business on 11 March, following “significant changes” to the way it operates.

This included the role of chief executive itself and responsibilities of the chief executive will be reassigned.

A Stock Exchange announcement stated her compensation for “loss of office will be paid in line with Alliance Trust PLC's remuneration policy and the terms of Katherine's contract”.

Peter Michaelis will lead investments, while operational responsibilities will be passed to Ramsay Urquhart as managing director.

Lord Smith of Kelvin, chairman of Alliance Trust, said: "Alliance Trust is undergoing significant change to improve both its operating performance and investment returns. It has always had investment expertise at its heart and Katherine has done much, over the past nine years, to refocus the investment portfolio on its traditional strengths in global equities.

"Alliance Trust is now moving swiftly to implement the changes announced last year which are designed to enhance shareholder returns. This process is well underway and it is clear to us all that the role of Chief Executive of Alliance Trust Investments has changed significantly. I and the rest of the Board wish Katherine every success in the future."

Ms Garrett-Cox said: "I am very proud of the significant achievements that my team has delivered over the past nine years at Alliance Trust. It has been an honour to have had the opportunity to represent and protect the long-term interests of so many shareholders and to have been a guardian of the Trust's historic purpose of investing for generations.

“I leave Alliance Trust Investments with a strong team who are already delivering improved investment returns and driving down costs."

Susan Noble, chair of Alliance Trust Investments, said: "I would like to thank Katherine for her contribution since joining Alliance Trust. Katherine led the establishment of Alliance Trust Investments, which now manages some £5bn of assets, building a team of equity and fixed income specialists and overseeing the development of its market-leading Sustainable Future funds.

“She leaves with the business in its best position for many years, evidenced by improving investment performance, a healthy level of funds managed for both Alliance Trust and third parties and the increasing opportunities for Alliance Trust Savings."