Aviva investors have rejected the British insurer's executive pay plan even after the company pledged to consult more widely in future.
Investors owning 823,375,824 shares voted against the remuneration report, more than the 688,459,007 in favour, preliminary proxy votes filed at the company's annual general meeting in London today show. The vote isn't binding. Investors owning 152,219,680 shares abstained, the figures show.
"We could and should have done more to engage with shareholders," Scott Wheway, chairman of the insurer's compensation committee, said before the vote. "Aviva won't be taking the same approach to recruitment awards again," and will "actively consult" with shareholders, he said.
Aviva chief executive Andrew Moss, 54, is under pressure from investors to improve returns after the stock dropped 58 per cent since he took over as chief executive in July 2007, making it the worst-performing member of the FTSE ASX Life Insurance Index over that period. While UK competitor Prudential grew in Asia, Aviva focused its resources on Europe just as the sovereign debt crisis gathered pace in 2009.
Moss last week waived a salary increase of 5 per cent to £1 million for 2012 after some shareholders said the company's performance last year didn't warrant the rise.
Investors also requested a pay review of new executives following the firm's decision to award UK head Trevor Matthews £470,000 in cash and £2 million in shares after joining from Friends Life last year.
A new pay plan will make sure "even if operational targets are hit we don't have the dislocation with the
share price described this morning," said Wheway. "I would like to apologize to any shareholder that feels their views have not been adequately represented in the decisions we have made," said Wheway.
Bloomberg
