City revolt hits more top chiefs
THE SHAREHOLDER Spring yesterday claimed its highest-profile victim yet as Aviva chief executive Andrew Moss quit the insurance giant following investor protests.
His resignation came on the same day that William Hill boss Ralph Topping avoided losing a vote on his remuneration package by the narrowest of margins.
Moss, who had led the firm since July 2007, plans to quit at the end of this month following an investor rebellion over the size of his pay packet and the firm’s poor performance.
Shareholders were infuriated that the firm had considered any rise in executive pay, given that Aviva’s shares are down more than 35 per cent since March last year and have lagged behind the rest of the sector.
At last week’s annual general meeting Moss offered to waive a £45,000 pay rise which would have nudged his basic salary up over £1m, but it was too little, too late and a huge 59 per cent of shareholders refused to back the remuneration plans.
“He has finally fallen on his sword after increasing pressure in recent weeks from shareholders and the media over pay and share price performance,” said Espirito Santo analyst Joy Ferneyhough.
Former Australia and New Zealand Banking Group chief executive John McFarlane, who was due to take over as non-executive chairman in July, will take on Moss’s duties until a replacement is found.
Moss will pick up a pay-off worth £1.75m as he departs the firm. In addition to a year’s salary of £960,000, the hastily-arranged package includes £300,000 in lieu of a bonus, £45,000 for legal fees, £209,000 in pension contributions and around £240,000 of shares from a previous year’s bonus.
Meanwhile bookmaker William Hill only just avoided an embarrassing defeat at yesterday’s AGM over the decision to award chief executive Ralph Topping £1.2m to stay with the firm.
A substantial 49.9 per cent of proxy votes were against the pay package but 50.1 per cent were in favour, with the matter being settled by a show of hands from shareholders in the room.
Last night William Hill chairman Gareth Davis told City A.M. that he was unapologetic about the size of Topping’s bonus: “This is not a reward for failure – this is a reward for tremendous success.”
Explaining that the retention package was necessary, he added: “I was concerned that we guarantee Ralph’s tenure for another few years to give me the space to put in place an effective and professional succession plan. Surely that has got to be in shareholder interest.”
But shareholders, already frustrated by the AGM results, are unlikely to be so understanding.