Top British insurance firm's CEO steps down

[NewsCaster]

The head of Britain's second-biggest insurance group Aviva has stepped down, as shareholders continue to pressure the company to tackle overpay for top managers perceived as underperforming.

Aviva said on Tuesday that Andrew Moss, the corporation's chief executive, was leaving the company immediately after five years at the helm.

Top British companies, and some firms abroad, are facing a wave of investor activism as shareholders rebel over high boardroom pay amid underperformance in the poor economic climate and moves by the state to clamp down on corporate greed.

"Aviva plc announces that Andrew Moss, chief executive officer (CEO), will be leaving the group and will cease to be chief executive with immediate effect," the insurer said in a surprising announcement on Tuesday.

Aviva said that John McFarlane, its incoming chairman, would assume executive duties with immediate effect. He will be tasked with helping to find a new CEO.

Shareholders' respect

"My first priorities are to regain the respect of our shareholders by eliminating the discount in our share price and to find internally or externally the very best leader to be our future CEO," McFarlane said in a statement.

"I will meet all of the major investors over the coming days and weeks."

Investors hailed the boardroom shake-up as Aviva's share price went up 2.88 per cent to 311 pence in afternoon trading on London's benchmark FTSE 100 index, which was down 0.29 per cent at 5,637.65 points.

Last week saw 54 per cent of its Aviva's shareholders vote against its remuneration report.

Including abstentions, almost 59 per cent of investors refused to endorse the group's executive pay policy, in a result announced at Aviva's annual general meeting in London on Thursday.

The rejection vote was non-binding but nevertheless a major embarrassment for Aviva, Britain's second-biggest insurance company after Prudential.

Aviva's defeat came despite Moss bowing to investor pressure and waiving a pay rise that would have taken his salary above $1.61m.

Moss was last month awarded a 4.6-per cent increase on his annual salary of