Standard Life is to plough £90 million worth of unclaimed shares from its demutualisation a decade ago into ramping up its charitable activities.
But the move was partly overshadowed as some 22 per cent of shareholders in the Edinburgh-based group voted at yesterday’s annual meeting against the group’s remuneration report.
Sir Gerry Grimstone, chairman of the Edinburgh-based company, told shareholders gathered in London: “When we demutualised in 2006, unclaimed shares were put into a special trust.
“We have made, and continue to make, every effort to trace those entitled to these shares and we continue to do so almost ten years on. This trust will come to an end in July 2016 and we intend to use its proceeds to strengthen considerably our charitable activities.”
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The chairman told the AGM, the first to be held outside its Scottish home town, that, specifically, Standard Life was to launch the Standard Life Foundation, “which will focus on work that addresses closing the savings gap in our society”.
Grimstone said the issue “touches, directly and indirectly, many millions of people in the UK”, and that “gifting” the estimated £90m of unclaimed shares from the flotation to the Foundation would make it “one of the largest bodies of its type in the UK”. It will replace the former Standard Life Charitable Trust.
The announcement came as Grimstone praised Standard Life chief executive Keith Skeoch for taking a voluntary cut to his long-term incentive plan (LTIP) for 2016 from 500 per cent to 400 per cent of his basic salary of £574,000. It means Skeoch would get £2.8m under his maximum payout – about £700,000 less than before.
“This was absolutely Keith’s decision which he volunteered, but I personally applaud it as being the right thing to do in the circumstances,” Grimstone said.
Some institutional shareholders had been unhappy at the scale of some of Skeoch’s potential bonuses, even though his base salary when appointed chief executive last summer was less than enjoyed by predecessor David Nish.
The chairman added that it was important to get good people managing the business, which made an operating profit of £665m last year.
However, he said that he accepted major companies needed to be aware of the “societal” impact of boardroom remuneration.
“My personal view is that pay in financial services is too high.” Grimstone said. “I think it would be a good thing if across financial services it was less than it is.”
The chairman also told shareholders that while the life and pensions giant was “strictly apolitical” and would not advise people how to vote, its assessment was that if the UK voted to leave the EU in the June referendum it would be “potentially damaging to the UK economy and therefore to companies such as Standard Life”.