The Shareholders Association says Fletcher Building's board should consider breaking up the company into more manageable parts to better manage the risks the business is facing.
The market was expecting Fletcher chief executive Ross Taylor to step down from his post this week, with the company in a trading halt ahead of its first-half financial result, to be released on 14 February.
The company also said in a statement the result was expected to fall materially short of what market analysts were forecasting, while Taylor was considering his position at the company.
"It was possible that, given the matters to be considered at the board meeting, the CEO of FBU [Fletcher Building] will consider his position with FBU with this to be announced when his decision is made," it said.
It followed a company announcement last week of another $180 million to complete or fix legacy projects, with questions remaining about the extent of the company's exposure to a multi-million-dollar leaky-pipe problem in Western Australia.
Shareholder Association chief executive Oliver Mander said the ongoing provision of costs to cover legacy problems pointed to an underlying problem with the company's leadership, under Taylor.
"I can imagine he's had a pretty tough road over the last few years. He did declare the provisions upfront, but what he has failed to do is to keep Fletcher Building within the limits of those provisions, and that's led to the constant provisioning year after year," Mander said.
"If that is becoming a systemic issue, it actually really does call into question just how real that underlying performance improvement actually is."
Mander said the board should consider a restructure of its composition, regardless of whether Taylor stayed or went.
There were a number of open questions about whether the company would be better off it was broken up into more manageable parts, he said.
"That's actually a conversation that we've had before with the board in terms of whether a structural breakup of Fletcher Building would create more value for shareholders. In the context of what has occurred with the latest provision, certainly that is something that may again be of interest to shareholders."
The ongoing costs and unknown risks had devalued the company, Mander said, adding that he would not be surprised if Fletcher became a takeover target.
"Certainly, it would not surprise me if that occurred, but obviously I'm extremely unaware of any speculation regarding that," he said.
"But from a risk perspective though, that should be a concern to any anyone looking to do that."
He said Fletcher's last traded share price of $4.16 reflected the risks facing Fletcher.