2008Annual General Meeting 2008
The Royal London Annual General Meeting 2008 was held at Glaziers Hall in London on 20 May.
As with previous years, members not attending the meeting in person could make their views known by registering a proxy vote. In addition, members were also able to vote online.
Approximately 24,500 Royal London members chose to vote.
A number of members attended the meeting in
person and took the opportunity to question the Board both formally, in the Question & Answer section of the meeting, and informally over a buffet lunch.
The proxy voting process and entry to the meeting on the day were managed by the independent scrutineers, Electoral Reform Services (ERS). To ensure that the votes of members present and the proxies were accurately reflected, ERS provided electronic voting consoles for voting at the meeting.
Results of voting at Royal London's Annual General meeting on 20 May 2008
| Resolution | For | Against | Withheld | % For |
| 1. Receive the Annual Report and Accounts 2007 | 23,799 | 439 | 349 | 98.2 |
| 2. Approve the directors remuneration report | 22,709 | 1,241 | 641 | 94.8 |
| 3. Reappoint PricewaterhouseCoopers LLP as auditors | 23,765 | 541 | 285 | 97.8 |
| 4. Approve the determination of the auditors remuneration by the directors | 22,990 | 977 | 624 | 95.9 |
| 5. Reappoint Mike Yardley as a director | 23,238 | 913 | 440 | 96.2 |
| 6. Reappoint Tom Ross as a director | 23,271 | 861 | 459 | 96.4 |
| 7. Authorise the Company and its subsidiaries to make political donations | 17,365 | 6,146 | 1,055 | 73.9 |
| 8. Approve and adopt the new Articles of Association | 22,687 | 777 | 1,129 | 96.7 |
Highlights of the 2008 Royal London AGM
Tim Melville-Ross, Chairman
Tim Melville-Ross welcomed members to the 147th Annual General Meeting of Royal London Group. He then explained the format of the meeting and the process of electronic voting.
Resolution
Tim spoke about Royal London's acquisition of certain businesses from what was previously Resolution plc. He highlighted the unique position of Royal London Group to take advantage of this opportunity. ( Further information regarding the Resolution acquisition can be viewed here)
He confirmed the whole process is now nearing its conclusion. Within the next few weeks he anticipated the completion of the Scottish Provident International transfer to Royal London. This will be followed, around the mid-year, by the transfer of the Scottish Provident protection business and other related assets. This will make Royal London one of the top 3 companies in the UK for sales of individual protection business. The final legal formalities relating to the transaction are targeted to be completed during the second half of 2008.
He explained the Board feel the two main highlights of this transaction are, firstly, the strategic fit of the new businesses into the Royal London Group and, secondly, the anticipated financial benefits.
Mutual Dividend
Tim advised that, depending on the particular circumstances in each year, the Board has decided it will seek to allocate part of the profits earned by the Group's businesses as a form of "mutual dividend". So for 2007, £39 million has been allocated to the relevant policies by way of enhancement to asset shares. This is the first outcome of work undertaken on reinforcing the benefits of mutuality. Further information about this can be read on page 4 of the Summary Financial Statement (page 29 of the Annual Report).
Mike Yardley, Group Chief Executive
Mike took the opportunity to highlight the key areas of success for Royal London Group and the businesses from 2007.
- Operating profit increased by 27% to £147 million
- New business contributed £61 million, an increase of £14 million compared with 2006
- Royal London Asset Management enjoyed another excellent year, reflected in new business more than doubling to £2.6 billion
- The Group's strong capital position has been maintained, despite stock market volatility and the "credit crunch"
- The Group was also successful in acquiring, last November, the UK's first online fund supermarket, Fundsdirect, which has developed a successful investment wrap platform, called Ascentric
Mike added that the wrap sector of the investment market has been growing rapidly in the past few years and this strategic acquisition gives Royal London an excellent opportunity to develop a presence in what is believed will be an increasingly important market sector.
He added that each of the five businesses within Royal London Group contributed to making last year a success for the Group.
Business Highlights:
- RLAM: Impressive growth on top of a successful 2006
- Scottish Life: The launch of the Pension Portfolio plan, in December 2006, helped secure a 10% increase in individual pensions new business
- Bright Grey: 12% increase in sales and an increased contribution to profit of £11 million from new business
- Scottish Life International: New business contribution to profit of £3 million
- RLAS: Implementation of a number of service improvements; ongoing use of new technology and improved processes to deliver more efficient service for the benefit of customers
Mike concluded by saying there is little doubt the difficult economic conditions will continue for the rest of the year and trading conditions will be tough. However the Resolution transaction provides significant opportunities and gives Royal London Group additional scale in the UK protection market and in offshore markets.
He concluded that although 2008 will not be an easy year for trading, the Group is well placed to continue to deliver profitable growth in the years ahead.
Stephen Shone, Group Finance Director
Stephen confirmed that everything Royal London Group does is aimed at delivering value to its members.
He highlighted the financial strength of Royal London Group noting that despite the background of increasing economic turmoil and stock market volatility, realistic free assets increased during 2007 by almost £100 million to over £1.9 billion. There are a number of benefits for members and with profits policyholders from Royal London's financial strength.
He explained that each of the businesses within Royal London Group contributed new business profits to the Group for 2007. The increase in contribution compared to 2006 was 30%.
Stephen advised that £278 million was added in bonuses to with profits policies in 2007 – an increase of more than a quarter above the figure in 2006. Over the past 8 years, Royal London has paid almost £800 million more than asset shares to with profits policyholders. As far as actual payouts are concerned, the comparison with other major with profits companies (those with funds above £10 billion) shows that Royal London continues to be one of the top performers for the benchmark 25 year term endowments.
David Williams, Chairman of Remuneration Committee
David gave a brief summary of the Royal London Remuneration Committee Report, which is set out in full on pages 40 to 43 inclusive of the Annual Report. A summary of the Committee's report is also included on pages 28 and 32 of the Summary Financial Statement.
He confirmed that the Remuneration Committee is confident that executive remuneration arrangements are in line with the market and are also geared to achieving the performance targets and strategic development objectives of the company.
Details for the 2009 AGM will be confirmed shortly.