Aviva AGM: Shareholders revolt!

Aviva @ 305.6p, -5.7p (-1.83%)

Hugely interesting to see the results of the Aviva showdown on executive pay at yesterday's AGM.

Actually quite encouraging to see an activist voting shareholder majority of 54% win the day when in the majority of these cases you hear (and support) the grumblings but then find it to have dissipated faced by a questionable solidarity amongst company management and major shareholders.

The vote appears to be the first won against a company's remuneration plans in 3 years (Glaxo), and follows swiftly on the back of the Barclay's vote which itself had a thought provoking 31.5% objecting to the company's executive pay plans particularly Bob Diamond's controversial double taxation package.

Its a shame that these votes are not executive and therefore only indicate dissatisfaction to the boards involved so it remains to be seen what level of changes/outcomes will be realised.

It does seem strange to me that these "stewards" of the company (an oft forgotten accountability) appear to have no restraint on the amount of compensation and remuneration that they can negotiate despite company under performance.

I also have my own views on this constant merry-go-round of nomadic, and seemingly mercenary talent.

Operations such as this must have established development programs but its questionable whether this is just a tick in the box or an active part of a company's strategy to develop best practice and strong cultural values. 

Certainly if the intention is genuine then this raises questions about the available mentor ship, values, and culture that filters down from "hired guns" that appear to put their own financial priorities above the company's declared values.

There is a balance required between all elements, and stakeholders, that seems missing these days. I also cringe at the oft quoted justification "thats what the industry scale is these days" for talent.

It seems to me that industry scale is only ever going in one direction given the unspoken cartel like approach to setting.

If an internal development program is effective then let the "so called talent" go and chase their priority whilst the company promotes from within and protects the culture of the company, and the trust, motivation, and loyalty of all employees.

Funnily enough financial security is only on the second level of Maslow's hierarchy of needs (just about the most common theoretical model taught in Management studies). 

This level of remuneration is much greater than just financial security but, somehow in this era, the 5 stage pyramid has been shaken up like a snow globe and an obscene financial gain has been pushed right to the top (albeit with the sub plot of self actualisation).