Aviva 2009 Annual Report Download - page 7

05
Aviva plc Group chief executive’s review continued
Annual Report and Accounts 2009
Q How has Aviva performed throughout
a difficult 2009?
Like all financial services companies, we have
been affected adversely, both by market
volatility and understandable customer caution.
However, the business has stood up well. This
is due, in part, to our global diversity, having
both life and general insurance operations and
also because of the decisive action we have
taken through the strategy put in place two
years ago.
Several months into 2010, we have made
great progress in transforming our UK business
under one team. We are also starting to see
positive results from the creation of our ‘one
Europe’ operating model. In North America, the
life market has been really challenged and it’s
good to see that coming back. In Asia Pacific,
despite customers being cautious, we have
continued to grow our business, particularly
in China and South Korea. Aviva Investors’
investment performance has radically improved
along with solid earnings.
Q How financially strong
is Aviva?
We’ve seen a marked improvement in our
capital position. Focusing on costs in order to
improve margins has meant that, whilst we have
seen volumes drop, we still reported a resilient
operating profit and a strong balance sheet.
We have worldwide sales of £45 billion and
£379 billion of funds under management.
We are managing our financial risks prudently
and skilfully.
Q Why did you cut your dividend
mid-year?
In light of Aviva’s lower IFRS operating
earnings, the continuing economic uncertainty
and our desire to retain flexibility, we felt it was
the right decision to make. So in spite of it
being a tough decision, we believe it was the
right one.
Q Do you remain committed to your
‘One Aviva, Twice the Value’ strategy?
We have made good progress towards our
target this year. If you compare earnings per
share of 37.8 pence in 2009 with those of
2008 (a loss of 36.8 pence), it's a great
improvement.
In the past 12 months we’ve increased the
pace of transformation and restructured our
portfolio, giving us new opportunities to
redeploy capital to support profitable growth.
Our senior management team is committed to
this target and it remains our focus in 2010.
Performance review
Corporate responsibility
Governance
Shareholder information
Financial statements IFRS
Financial statements MCEV
Other information
Q How is your business
changing?
In 2008 we initiated a programme to create
a simplified and more modern way of doing
business to improve efficiency and reflect
customers’ preference to do business online;
we’ve invested in new technology and
streamlined our processes.
This fundamental change in the way we
operate means our business is now fit for
the future, with improved capacity and
productivity. We have reduced our costs by
£500 million and Aviva has 19% fewer
employees than two years ago.
What's really pleasing is that during this
period our customer satisfaction has improved,
with nearly 70% of our businesses at or above
the local market benchmark and 50% are in
the upper quartile.
Q What are you most proud of
in 2009?
I'm most proud of our people: their dedication
and resilience over the past year has been
incredible. They've remained focused on what
we're here for – delivering prosperity and peace
of mind to our customers – and have done a
great job.
I’ve already talked about our financial
strength and the strategically significant
achievements in our business. However, none
of this could have been done without the hard
work of all of our people around the world.
Looking forward – how would you
Q sum up your priorities for 2010?
There’s no question that the economic climate
remains uncertain: 2010 is still challenging but
I’m confident we have the right team, strategy
and commitment to make it another successful
year. We will continue to deliver our strategy,
maintain our capital strength and focus on the
profitable growth of our company.
53 million customers place their business
with us. That’s a great responsibility and we
will be working harder than ever in 2010 to
continue to earn their trust and attract new
customers to Aviva.
Andrew Moss
Group chief executive