Aviva's 'visionary' chief in surprise decision to quit

Richard Harvey, the chief executive of the insurance giant Aviva, surprised the City by announcing his resignation yesterday, claiming he wants to pursue new challenges in the charity and business arenas while he still possesses the "energy and desire to make a difference".

Mr Harvey, who is only 56, is to step down from his post in July after almost a decade in the top job. Andrew Moss, Aviva's finance director, will take over as the chief executive, while Philip Scott, the group's executive director, who is currently responsible for the business's international operations and for its fund management arm, will step up to replace Mr Moss.

Although Mr Harvey's resignation was not anticipated by either investors or analysts, Aviva's chairman Lord Sharman of Redlynch said he had always been aware of his intention to step down before he reached 60.

"When I became Aviva's chairman, Richard signalled to me that he may not want to stay until the normal retirement age of 60," he said. "This is characteristic of his openness, integrity, capacity for thinking well-ahead and innate desire to do what is right. I respect his wish to apply his many and varied talents to other ventures, all of which will undoubtedly benefit from his visionary insight and strong leadership.

"Richard Harvey is a class act by anyone's standards. His professionalism, skill, and foresight have made a lasting, positive contribution not only to Aviva but to the international insurance industry."

Mr Harvey said the timing of his decision had been driven by a desire to leave when Aviva, which runs under the Norwich Union brand in the UK, was in good health. "Obviously we have picked this time because the company is in good shape, trading steadily, and we are not expecting any revolution," he said. "This is not to say we won't respond appropriately to anything that happens in the external market."

Although shares in the company fell 8p to 822.5p, analysts were broadly supportive of the decision to replace Mr Harvey with the company's finance director. Mr Moss joined Aviva in May 2004, since when he has helped guide the company through the acquisitions of both RAC and the American insurer AmerUS.

The group failed to buy its largest quoted UK rival, Prudential, last spring. Before joining Aviva, Mr Moss, who is a qualified chartered accountant, was a director at the Lloyd's of London insurance market.

Speaking yesterday, the chief executive-elect said he had no plans to change the company's strategy once he takes over. "I will be reviewing some issues, talking to people both internally and externally about the possible directions that I can take, but I fundamentally believe we are on the right track," he said.

In a note published yesterday morning, analysts at Merrill Lynch praised the decision to appoint Mr Moss: "Andrew Moss has shown himself as a highly disciplined and robust CFO since joining in 2004. We think his appointment indicates a continuation of strong capital management and financial discipline, which are key to our positive view of Aviva."

However, David Dodds, an analyst at SVM Asset Management, suggested Mr Moss would still need to prove himself in the top job, following his involvement in the failed bid for Prudential last year, which shook some investors' confidence in the group's management.

Mr Harvey joined the group in 1992 as head of its New Zealand operations, before returning to work for the company in the UK in 1993. He was Norwich Union's finance director when the group demutualised and floated in 1997 and was appointed as the chief executive in 1998. Two years later, he oversaw the company's merger with CGU and its subsequent rebranding under the Aviva name.

Harvey's record

1992 Richard Harvey joins as chief executive of Norwich Union's New Zealand business

1993 Returns to UK to work in NU's finance department

1995 Appointed group finance director

1997 Plays leading role in taking NU through its demutualisation and flotation

1998 Appointed chief executive of NU

2000 Leads the company through its merger with CGU

2003 Appointed chairman of the Association of British Insurers

2005 Sets up the acquisition of RAC, the car rescue business

March 2006 Fails in an attempt to buy Prudential

July 2006 Raises US presence with purchase of AmerUS

2007 Stands down