Directors’ wage bill cut as Aviva aims to rebuild investor relations

Britain’s fourth-biggest insurer by market value paid its directors a total of £4.77m in 2012, down from £7.28m the previous year, figures published yesterday in its annual report showed.

In May last year, Aviva became a high-profile target of the ‘shareholder spring’, a Europe-wide investor revolt against bumper executive pay, when half of its shareholders voted against its pay proposals for 2011.

Chief executive Andrew Moss was forced out less than a week later as criticism mounted over a poor share price performance during his tenure.

The drop in earnings for Aviva’s top managers in 2012 largely reflects the cancellation of all director bonuses.

Chairman John MacFarlane, who took day-to-day control of the insurer following Mr Moss’s departure, received no extra pay despite his increased work- load.

“Whilst we have traditionally had good shareholder support for our remuneration policies over many years, we believe in 2011 we clearly got it wrong,” remuneration committee chairman Scott Wheway wrote in the report.

“As a result, the committee has worked over the last year to make changes that will give us a better framework for the decisions we take.”

Aviva, which in July began cutting costs and selling underperforming businesses in an effort to boost profits, said earlier this month that directors would get no pay rises in 2013.

Mark Wilson, the former head of Asian insurer AIA, who took over as Aviva chief executive in January, is entitled to up to £200,000 to cover the cost of relocating to London from Hong Kong, Aviva said.

Aviva has 4,500 staff in Yorkshire, including 1,700 in Sheffield and more than 2,500 in York.