Group strategy

Dear Shareholder,

Following the appointment of Andrew Moss as chief executive in July 2007, and the new Executive team, we have refreshed our strategy, building on past achievements, under the banner of “one Aviva, twice the value”.

In doing so, we have clarified the five strategic priorities we will pursue at a Group wide level (shown on the right), to maximise the value we can generate for all our stakeholders.

Equally, we have distilled what this means specifically in each of our new 'Regions' formed in 2007: UK, Europe, North America and Asia Pacific, as well as our asset management business. These priorities are described in further detail in subsequent sections.

We have communicated our financial targets to the market. Internally, we have invested considerable effort in energising the organisation and its employees to deliver the results.

We have made significant progress against our strategic objectives in 2007, amid a challenging external environment, and look forward to accelerating from our strong starting position into 2008 and beyond.

Anupam Sahay
Group strategy & development director

To achieve our vision, we are focused on delivering against our five key strategic priorities. These are set out below:

Manage composite portfolio:

We are fully committed to maintaining the composite nature of the group. We firmly believe in the benefits of life insurance, general insurance and asset management as complementary parts of an overall business model that balances cashflow, returns and long-term value creation, and delivers prosperity and peace of mind to customers.

Build global asset management:

We have significant asset management functions across the Group. These businesses have historically been managed separately, and we are now bringing them together in a global asset management business – Aviva Investors – that will foster investment performance and creation of solutions, with an increased focus on winning external clients.

Allocate capital rigorously:

Capital management will continue to be a key focus for Aviva going forward. Capital is treated as a scarce resource, and is allocated to provide the highest sustainable returns for shareholders. We continuously seek improvements in capital structure and efficiency.

Increase customer reach:

We sell our products in 27 countries in the way that our customers choose to buy them. We will continue looking for the right distribution in the right markets. We also get closer to our customers through better understanding their needs, which helps us to generate profitable sales, by providing products and services that customers want at a fair price.

Boost productivity:

We constantly look for ways to boost our productivity, in order to increase our competitiveness, improve our services and deliver higher value to our customers. This will enable Aviva to deliver further sustainable growth.

We made good progress in 2007 against priorities set out in last year’s Annual Report. Some of our achievements are detailed below, under our strategic priorities, and some covered in the regional sections, where we also describe our regional growth/profitability targets. We have also set out below the measures that we use to assess our success in achieving our group strategic priorities and what we plan to do in 2008.