Senin, 30 April 2012

'Fat-cat' pay backlash hits insurance giant Aviva

'Fat-cat' pay backlash hits insurance giant Aviva

By James Salmon

PUBLISHED: 16:27 EST, 30 April 2012 | UPDATED: 16:27 EST, 30 April 2012

The backlash against fat-cat pay has spread to insurance giant Aviva.

Chief executive Andrew Moss yesterday buckled under growing pressure and waived a 4.8 per cent pay rise which would have pushed his salary above £1million.

The conciliatory gesture, which still leaves him with a package worth up to £5.2million, comes ahead of a crucial vote on Aviva’s remuneration report at its annual meeting in London’s Barbican arts centre on Thursday.

Waiving goodbye: Aviva boss Andrew Moss bowed to pressure yesterday and gave up a 4.8 per cent rise

Waiving goodbye: Aviva boss Andrew Moss bowed to pressure yesterday and gave up a 4.8 per cent rise

In a humiliating blow, Aviva has been slapped with an ‘amber top’ warning â€" the financial industry’s equivalent of a yellow card â€" from its own lobby group, the Association of British Insurers.

A similar warning over executive pay was also meted out to Barclays earlier this month, but it is particularly embarrassing for Moss, who sits on the ABI board.

Shareholders are incensed about the bumper pay and perks enjoyed by Aviva’s top brass, despite shares losing more than a fifth of their value last year.

The insurer also had to book a £1.1billion loss on long-term investments in troubled eurozone countries last year, which almost pushed it into the red.

Insiders predict that Aviva faces a major protest vote, with around a third failing to back its remuneration report.

Moss’s pay is not the only potential flash-point at Thursday’s showdown, where Aviva is also likely to announce job cuts as part of a sweeping restructure.

Trevor Matthews, parachuted in as UK chief executive in December before being switched to a different role as part of a management reshuffle, received pay and perks of up to £4.2million last year.

This includes a £2.5million ‘golden hello’ to compensate him for awards forfeited when he left his previous role as vice chairman of Friends Life. It is understood Matthews’ awards have been flagged as a major concern by the ABI and investor group Pirc, which has called on shareholders to vote against Aviva’s executive pay report.

The insurer has now agreed to review the payment of ‘golden hello’ bonuses.

Insurance companies have largely avoided the glare of publicity over pay, which has thus far focused on the banks. But over the weekend mutual Royal London set itself on collision course with its members, slipping out details of a £4million ‘golden goodbye’ payment to former boss Mike Yardley.

US shareholders have been reacting even more violently to excessive pay.

Citigroup saw the pay and perks of its senior staff, including £9million for boss Vikram Pandit, rejected by more than half of votes at its annual meeting.

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