Blog: Mark Wilson the surefire hit as Aviva CEO, who lost the trust

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Following yesterday's announcement by Aviva that Mark Wilson is to step down as group CEO of Aviva, Jonathan Swift reflects on why the move was not such the "shock" some painted it as.

This week I read a number of headlines/stories relating to departure of Aviva group CEO Mark Wilson with “shock” in them.

I could think of a number of words you could link with this move, but “shock” is probably not one of them.

Indeed it was probably more of a “shock” that he lasted this long – almost six years – given the length of other senior tenures in the insurance space, whether they are doing a good job or not.

Looking back when Wilson, pictured, was unveiled as the new CEO of Aviva it appeared that the insurance group has pulled off something of a coup and that he was about as sure a thing as you can get in financial services.

True, his experience has been in Asia in recent years – a market his new employer was perceived to be retrenching from – but Wilson was seen as someone with a good track record; and more importantly he was not tainted by the previous regime. It would have probably been corporate suicide if that had promoted from within at the time.

Beginning on 1 January 2013, Wilson took charge of a restructure programme that was already in place, overseeing a streamlining of the workforce and a disposal programme including the sale of the life and annuities business Aviva USA to Athene Holding for $2.6bn (£1.7bn).

He even led a significant acquisition in Friends Life, a deal Wilson claimed would “accelerate” Aviva’s turnaround and enhance its ability to deliver improved cashflow and growth.

However, despite the results improving the business has continued to fail to spark on the stock market. If you take the last five years, Prudential has risen from 1178 pence to 1683 pence and Admiral 1226 pence to 2024 pence. Aviva has risen from 427 pence to 462 pence over the same period, a similar rise to RSA (532 pence to 571 pence), an insurer that recently announced a profit warning.

What’s more there have been shareholder revolts about Wilson’s bonus package and things reached a head earlier this year when Aviva had to backtrack on its controversial plan to cancel £450m of preference shares, which attracted the interest of the regulator.

Conceding the u-turn Wilson said: “The reputation of Aviva, and the trust people have in us, is paramount. Our announcement today means that preference shareholders can rest secure in their holdings. The board and I have a duty to consider not just the financial implications of our actions. We must consider the impact to Aviva’s wider reputation. I hope our decision today goes some way to restoring that trust.”

In light of this week’s announcement, it appears he is not considered the man to build that bridge.

So what will Wilson’s be remembered for outside the above?

He might not as been as au fait with general insurance, and indeed the UK GI market when he took over, but he did raise his head over the parapet when it came to market wide issues such as personal injury and the Competition and Markets Authority’s perceived failure to deliver required reform following its two year investigation into the private motor insurance market.

Wilson was also vocal on the issue of Brexit commenting “So do we think leaving the EU is worth it? On balance, no. Because there is no insurance policy against Brexit.”

One of my favourite memories of Wilson was his interview in The Sun where he throw away the suit and tie and donned jeans to take a journalist around its Digital Garage in Hoxton.

He might have annoyed some internally by revealing its plans for Ask It Never, months before the business intended to go public; but it did underline his commitment to both combatting dual pricing and the digital agenda.

Meet someone at Aviva and it is not long before they usually repeat the refrain about it being a “320-odd year old disruptor”, a line which he might not have coined, but came to be associated with the outgoing CEO.

The Garage might be viewed by some as a vanity purchase, but in recruiting Andrew Brem as its first chief digital officer [although his recent departure to British Airways might have been a precursor of what was to come] and investing heavily in insurtech Aviva has certainly made a mark in terms of its perception, coming top of Post’s recent survey where respondents were asked to name the most digitally savvy insurers.

Given the long tail on these investments, Wilson will no longer be around to see the financial benefits and legacy of these digital moves; but I suspect like his role in the initial turnaround he oversaw, people might look more fondly on his reign in time if Aviva does hold its own independent path, rather than being swallowed up by another.

As to who the baton passes, I suspect Aviva will again look outside given the “trust” issues the board has suffered. And having lost one CEO in waiting previously in Tidjane Thiam [to Prudential] who went onto appear on Desert Island Discs, maybe they could look to someone else who has been shipwrecked on Radio 4 and will soon be out of work in Inga Beale.

And what’s more her successor at Lloyd’s, John Neal, was followed at QBE as group CEO by Patrick Regan, who was also once considered a potential heir apparent at Aviva where he was chief finance officer until 2014. Now wouldn’t that be uncanny.

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