Corporate governance practices
This section of the website provides an overview of the corporate governance practices at Aviva plc (the Company), with a focus on the board and how it operates. This starts with a brief discourse on the corporate governance rules applied by the Company and highlights a few aspects of the board's corporate governance practices.
Corporate governance framework
The Company is subject to the UK Corporate Governance Code (the Code), which it aims to comply with fully. Details of the Company's compliance with the Code are set out in the Annual Report and Accounts and on the section of the website on Compliance with the UK Corporate Governance Code.
As a foreign company listed on the New York Stock Exchange (NYSE), the Company is required to comply with the NYSE corporate governance rules. This is to the extent that such rules apply to foreign private issuers such as Aviva plc. Details of our obligations in this regard are highlighted in the section of the website on Compliance with NYSE Corporate Governance Rules.
Management structure
The directors of the Company are responsible to shareholders for ensuring that the Company is appropriately managed and that it achieves its objectives. Matters not specifically reserved for the board and its committees under its terms of reference, or for shareholders in general meeting, are delegated to the group chief executive. In turn, the group chief executive has delegated responsibility for specific operations to the members of the executive committee.
The executive committee comprises the Company's senior management team and its members include the functional leaders and the chief executive officers of Aviva Investors and Aviva France. Other members are the chief executive officers of Aviva UK & Ireland General Insurance and Aviva UK & Ireland Life.
The committee also includes the chief executive officers of the developed markets and higher growth markets, as well as the group general counsel and company secretary. The functional leaders are the chief executive officer, chief financial officer, chief risk officer, chief operating officer, chief marketing and communications officer and the group HR & CR director. The biographical details of the executive committee members can be viewed on the group executive committee section of the website.
Composition of the board
The board is made up of the chairman, eight independent non-executive directors, the executive deputy chairman and two executive directors.
The biographical details of the directors can be viewed in the section on directors' profiles.
Aviva complies with the Code requirement that at least half of the board, excluding the chairman should be independent non-executive directors. At present, all the non-executive directors are independent.
Appointment and re-election of directors
Appointment to the board is on the recommendation of the nomination committee, following a search undertaken by an executive selection agency and a series of interviews. If an appointment is made to the board between AGMs, the director will be put forward for election by the shareholders at the next AGM following the appointment.
All directors are subject to annual re-election at the Company's AGM, in compliance with the UK Corporate Governance Code.
Remuneration policy
The Remuneration Committee considers alignment between Group strategy and the remuneration of its senior executives, including executive directors, to be critical. It believes that senior executives should be appropriately rewarded (on a market competitive basis) for the delivery of stretching goals but should receive reduced rewards when the business performs poorly.
Board induction and training
Directors participate in a comprehensive, tailored induction programme when joining the board. They are also required to commit to continue their personal development through attendance and participation on relevant courses, seminars, workshops and lectures.
The comprehensive induction programme consists of several separate sessions with senior management throughout the business over a number of months. This includes presentations and discussions with key members of senior management, visits to the Group's main operating businesses and meetings with the external auditor and the Company's corporate brokers.
Board evaluation
A rigorous evaluation of the board, its committees, the directors and the chairman is undertaken each year, to assess performance. The process is usually led by the chairman and supported by the group company secretary. At least once every three years, the evaluation process is undertaken by an independent consultancy and interviews are conducted with each board member. The effectiveness of the board committees is also evaluated annually.
Board committees
The board has established five standing committees, with clear terms of reference, to ensure oversight of important issues of policy outside the main board meetings. The committees are audit, corporate responsibility, nomination, risk and remuneration. Further details of the duties and activities of the committees, their composition and their terms of reference can be viewed on the board committees section of the website.
