Aviva 2013 Annual Report Download - page 105

Strategic report Governance IFRS Financial statements Other information
Aviva plc
Annual report and accounts 2013
103
Directors’ remuneration report continued
Share options (audited information)
Details of the EDs who were in office for any part of the 2013 financial year and hold or held options over ordinary shares of the
Company pursuant to the Company’s share based incentive plans are set out in table 23 below.
Savings-related share options refer to options granted under the HMRC approved Aviva 2007 SAYE Scheme. Options are
normally exercisable during the six-month period following the end of the relevant (3, 5 or 7 year) savings contract.
Executive share options (approved) refer to options granted under the HMRC approved schedule to the Aviva Executive Share
Option Plan 2005. Options were exercisable on 30 March 2013 to the extent that the LTIP awards granted in 2010 had vested.
No options were exercised and have now lapsed.
Table 23: EDs’ options over Aviva shares
At 1 January
2013
Number
Options
granted
during year
Number
Options
exercised
during year
Number
Options
lapsing
during year
Number
At 31
December
2013
Number
Exercise Price
Pence Exercise Period1
Patrick Regan
Savings-related options 2010 2,903 — — — 2,903 310.0 Dec 13
–
May 14
Executive share options (approved) 2010 7,772 — — 7,772 — 386.0 Mar 13
Notes
1 Any unexercised options will lapse at the end of the exercise period.
The closing middle-market price of an ordinary share of the Company on 31 December 2013 was 449.7 pence, and the closing
middle-market price of an ordinary share of the Company during the year ranged from 294.1 pence to 449.7 pence. During the
year, no share options were exercised by directors (2012: nil options exercised).
EDs did not pay for the award of any share options and options are not subject to performance conditions (the savings related
options being granted under an all-employee share scheme and the executive share options being linked to awards under the LTIP
which are subject to performance conditions).
Dilution
Awards granted under the Aviva all employee share plans are met by the funding of two employee trusts administered by external
trustees that acquire shares in the market. The current practice is that new issue shares will generally only be issued where it is not
practicable to use the trust. However, the funding policy is kept under review by the committee and the Board. Details of the
shares currently held in the employee trusts are set out in note 33.
During 2013, loans totalling £31.9 million were made to the external trustees to ensure sufficient shares were available to meet
the Company’s on-going liabilities.
The Company monitors the number of shares issued under the Aviva employee share plans and their impact on dilution limits.
The Company’s usage of shares compared to the relevant dilution limits set by the Association of British Insurers in respect of all
share plans (10% in any rolling ten-year period) and executive share plans (5% in any rolling ten-year period) was 1.45% and
0.82% respectively on 31 December 2013.
Governance
Regulatory remuneration code
The Financial Conduct Authority’s (FCA) remuneration code applies to Aviva Investors and two small ‘firms’ (as defined by the FCA)
within the UK & Ireland Life business. These businesses for 2013 were subject to the remuneration code under the Capital
Requirements Directive III. From 1 January 2014 a number of these firms are now subject to Capital Requirements Directive IV and
the subsequent revised remuneration code. Remuneration code requirements include an annual disclosure. For Aviva Investors this
can be found at www.avivainvestors.co.uk/about_us/our_corporate_governance/index.htm and for the UK & Ireland Life firms at
www.aviva.com/media/news/item/fsa-remuneration-code-disclosure-17178.
Aviva’s reward principles and arrangements are designed to incentivise and reward employees for achieving stated business
goals in a manner that is consistent with the Company’s approach to sound and effective risk management.