STANDARD Life's top executives could receive a total of almost 2.8m shares, after the company's cash-based incentive scheme was converted to share-based awards, reports the Scotsman.
According to a spokesman, under the group's long-term incentive plan (LTIP), the switch from cash to shares has been carried out to make sure the scheme is in line with best practice.
"Governance bodies such as the Association of British Insurers and the National Association of Pension Funds prefer to see share-based incentive schemes rather than cash ones," he added.
Under the plan, the newly floated company's chief executive, Sandy Crombie, could receive a maximum of 952,716 shares - worth more than £2.39m at yesterday's closing share price of 251p - as long as a series of "demanding performance criteria" are met.
The group's spokesman said the targets for the scheme, which has been vetted independently and benchmarked against companies such as Legal & General, Prudential and Aviva, would generally be profitability and European embedded value-type measures.
Trevor Matthews, head of the UK life and pensions business, could pick up 393,184 shares, while John Hylands, who masterminded Standard Life's flotation, could receive 270,863 shares.
Finance director Alison Reed is on course to pick up 335,925 shares, while Keith Skeoch, head of Standard Life Investments, will receive 161,306 shares.
According to the spokesman, the shares have been converted from the cash awards made in January 2005 and January 2006 and will be paid out in 2008 and 2009 respectively - "if at all".
Gerry Grimstone, the group's deputy chairman and chairman of the remuneration committee, is quoted as saying by the paper: "The remuneration committee has set Standard Life's management demanding financial targets.
"Everybody should be delighted if we end up paying out these bonuses because it will mean there has been a dramatic improvement in the group's performance over the period of the plan.
"That is the whole reason behind incentive-based remuneration, which Standard Life had never had previously."
The Scotsman says to convert the cash incentives to shares, the company used the average share price over the first 20 days of trading, which ensured the management didn't benefit from any immediate premium when the shares started trading.
Standard Life discussed the planned conversion with institutional shareholders at the time of the IPO and, according to the spokesman, they all gave the scheme their approval at the time.
"By converting to shares, we have ensured that management interest is aligned to shareholders'," explained the spokesman.
Standard Life said the next granting of LTIP awards would be made in 2007, after the release of the company's results for the year ending 31 December 2006.
AVIVA reported a record set of half-year results, with worldwide operating profits up by more than a quarter to nearly £1.7bn amid strong sales growth across all of its businesses, reports the Times.
The paper says the group, fresh from the acquisition of US counterpart AmerUS, met its targets on international growth and reported a 43% increase in UK sales to nearly £6.9bn.
Sales in continental Europe rose by 10% to £7.2bn, with sales in the US and Asia both up as well.
Operating profits from worldwide sales of general and health insurance rose by 23% to £866m, with sales of long-term savings products up by 25% to £15.6bn.
Operating profits at the life business rose 19% to £1.02bn, with 66% of this coming from its international operations. In June, Aviva set itself a target of increasing organic growth at its overseas arms by 10% a year.
Richard Harvey, the chief executive, also reported Aviva's best ever efficiency levels in general insurance, with the combined operating ratio at 92%. The lower the percentage, the better for insurers.
"Aviva has once again delivered top and bottom line growth around the world," Harvey said. "We've grown premiums, profit and dividend and are reaping the benefits of being in the right markets at the right time.
"Especially pleasing is our increased market share in a stronger UK market and, in line with our ambitions, international life profits growth continues to outpace excellent sales," he said.
The contribution from new business rose by 17% to £459m, with Aviva claiming the profits margin here remains strong at 3.5%.
Shares in Aviva closed last night at 732p. Spread-betters at Cantor Index predicted that the shares would open higher, at between 738p and 740p.
But after the first hour of trading the shares were down 6p to 726p, a fall of 0.82%.
LIFE INSURER Friends Provident beat sales expectations yesterday with a 39% jump over the first half, to just over £3bn, reflecting strong growth in life insurance and pensions, reports the Guardian.
Underlying profits, however, fell by 9% to £247m on a European embedded value basis, which insurers use to show the value added to the business.
The paper says Friends put profit comparisons were distorted by the inclusion of £46m of one-off accounting gains last year and, stripping these out, first half profits were ahead by 9%. The group also warned of a further loss of clients at its troubled F&C asset management arm.IFAonline
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