Aviva 2007 Annual Report Download - page 19
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Please find page 19 of the 2007 Aviva annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Aviva plc
Annual Report and
Accounts 2007
15
Business
review
ROE
Target
0
2
4
2004 2005 2006 2007
16
14
12
10
8
6
ROE %
Return on equity shareholders’ funds
0
5
10
2004 2005 2006 2007
35
30
25
20
15
0
0.5
1.0
3.5
3.0
2.5
2.0
1.5
Dividend (pence)
Dividend cover (x)
Proposed ordinary dividend per share
and dividend cover
Dividend
Cover
Return on equity shareholders’ funds†
We aim to deliver an after-tax operating return on opening equity shareholders’
funds, including life profits on a European Embedded Value (EEV basis),
equivalent to 12.5%.
Our post-tax operating return on equity shareholders’ funds was
11.3% (2006: 13.1%). The reduction against 2006 reflects higher opening
shareholders’ funds, which have increased by £2.6 billion. The return is below
our target of 12.5% due to the impact of the adverse weather in the United
Kingdom which has suppressed the return on our general insurance operations.
Proposed ordinary dividend per share
and dividend cover**
Our intention is to increase the total dividend on a basis judged prudent using
a dividend cover in the 1.5 to 2.0 times range as a guide, while retaining
capital to support future business growth.
Our board has recommended a final dividend of 21.10 pence per share
(2006: 19.18 pence), bringing the total dividend for the year to 33.00 pence
(2006: 30.00 pence). This is a 10% increase (2006: 10%). Dividend cover is
1.60 times (2006: restated 2.26 times), within our target range.
0
10
2005 2006 2007
40
50
60
70
20
30
Aviva climate survey results 2007
Engagement
Leadership
% satisfied
Employee engagement and leadership
Our global employee climate survey continues to provide measures of
employee engagement and leadership. For Aviva, employee engagement
represents the degree to which people believe in this being a great place
to work and are contributing to help meet our collective goals and ambitions.
The survey results are used each year to determine and implement actions
with the aim of achieving continuous improvement. The climate survey
measures employees’ perceptions of leadership, verifying alignment with our
strategic direction and immediate business plans. Our aim is to improve both
measures over time and meet or exceed a global financial services benchmark.
During 2007, we showed progress on both our engagement and
leadership scores which is reflective of the work undertaken to focus and
embed the people strategy. While we have shown progress against external
benchmarks, we recognise that we need to continue to improve as we are
slightly lower than the global financial services norm on both measures.
Customer satisfaction
All Business Units measure and track progress in customer advocacy, and, where feasible, benchmark performance
against local competitors.
In 2007, over three quarters of our business units exceeded their 2007 target levels of customer performance
and stretching targets have been set for 2008 to drive continuous improvement.
We are committed to greater harmonisation of customer measures across the group and a common ‘dashboard’
of ten key customer KPIs was introduced at the end of 2007 for the UK businesses, and will be rolled out internationally
in 2008.
** Dividend cover is measured on operating earnings after tax on an IFRS basis, expressed as a multiple of the ordinary dividend in respect of the financial year.
† Return on equity shareholders’ funds is calculated using after-tax return based on operating profit, including long-term savings profit on a European
Embedded Value (EEV) basis before adjusting items, and opening equity capital.