Pru investors to rebel over executive pay

Steve Dinneen
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THREE major investors are voting against Prudential’s remuneration package, heaping more misery on the embattled firm.

Aviva Investors, Schroders and Co-operative Investments, all top 40 investors, say the awards being offered to two new executives, which have come under scrutiny lucrative “golden hello” deals, are unacceptable.

The remuneration package is still expected to pass at the annual meeting today with around 10 per cent of shareholders likely to rebel.

Finance director Nic Nicandrou received compensation of £638,000 in lost incentives from former employer Aviva and Head of the Pru’s UK business Rob Devey was handed £290,000.

The Pru hit back at the package last night, telling City A.M.: “The award of these restricted shares, made on joining last year, was to compensate these individuals for the loss of outstanding deferred share awards at their previous employers.

“This is in line with FTSE 100 best practice. Our directors remuneration policy is linked to the long term performance of the company.

“Our remuneration report received a Blue Top from the ABI and Risk Metrics gave it a ‘for’ vote.”

Meanwhile, sources close to the company would not rule out a second look at AIA, but only if the price came down markedly.

The rumour mill went into overdrive over the weekend when chief executive Tidjane Thiam appeared unwilling to close the book on the deal.

The Pru strenuously denied any second deal is in the making, issuing a strongly worded statement saying: “We remain highly committed to Asia through our current very successful business. We will not be resurrecting the AIA deal and any speculation is misguided and inaccurate.”

But a source said: “Thiam did not rule out a second bid because if the price dropped to an irresistible level then of course there would be one.

“This isn’t likely but it would be foolish for him to say there will never be a deal.”

SALARY: £550,000
SHARES: £638,000
Nic Nicandrou was awarded 110,000 shares as part of the deal to lure him from Aviva. This translates to around £638,000, to be paid over a number of years. He worked for Aviva for 11 years, most recently as finance director for Norwich Union Life. He was previously Aviva group financial control director and before that Aviva Group financial management and reporting director.

SALARY: £550,000
SHARES: £290,000
Rob Devey received 57,000 shares, or £290,000, when he joined the firm, which can be cashed immediately.

He joined Prudential from Lloyds Banking Group where he has worked since 2002 in a number of senior roles across insurance and retail banking, including as managing director of HBOS Financial Services and managing director of HBOS General Insurance.