James Moore: Aviva might want to demonstrate this tremendous value shareholders pay for
This sets a terrible example to the firms in which Aviva’s fund management arm invests
Outlook Faced with the very real possibility of a Barclays-style blow up at its AGM on Thursday, Aviva's chief executive Andrew Moss has taken the prudent course and declined an inflation-busting pay rise of nearly 5 per cent. Perhaps he, at least, sees the problem: notwithstanding the continuing questions about strategy (critics claim it doesn't have one) the shares have fallen off a cliff over the last couple of months.
Unfortunately this fact seems to have passed Scott Wheway, the chairman of Aviva's remuneration committee. Ditto his colleagues, who released a statement in which there was much hand wringing yesterday.
Mr Wheway seemed genuinely surprised that shareholders are unhappy with the company offering up big pay rises to executives and even bigger golden hellos to those executives' pals when they have been losing millions.
But then this is a company with form. When Mr Moss joined he came up with the idea of an ambitious campaign aimed at doubling earnings per share, called One Aviva, Twice the Value. Which really ought to be what he is paid his salary for.
Not in the view of Aviva's remuneration committee, though. It could have monitored executives' achievements against the plan's targets and used that to inform its decisions on the existing bonus schemes. But it didn't. Instead it created a brand new additional bonus scheme linked to the plan.
This sort of thing sets a terrible example to the companies in which Aviva's fund management arm invests. After all, what's good for the goose...
But there's more. Those "stretching targets" that remco's like to bang on about? One analyst has said Aviva's are now below the level of last year's results. Perhaps it is time for a fresh campaign: One Aviva, Half the Value, with a special extra bonus scheme of its own.
Despite all this, Mr Wheway is still insisting that the pay rise is justified and in shareholders' long-term interests. As if Mr Moss were a stellar talent who might be on the radar of a rival with a golden hello of its own.
Thanks to the committee's spectacular misjudgment of the mood of the people whose interests it is supposed to represent, Mr Moss is going to have to prove this is the case rather quickly. Otherwise it won't just be the remuneration committee which will be fielding calls from unhappy shareholders.
- 1 Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
- 2 A politically correct lefty goes to see Top Gear live – you'll probably believe what happened next
- 3 Young Preston fan has play-off hero Jermaine Beckford's shirt stolen from him at Wembley - which then appears for sale on Gumtree
- 4 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 5 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
Woman accidentally shoots herself in the head while posing for a selfie
How China's richest man Li Hejun lost $15bn in an hour - and made a fortune
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Snoop Dogg on why he doesn't regret displaying misogyny towards women
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
A nation of inequality: How the UK is failing to feed its most vulnerable people
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...