Directorate Change

RNS Number : 6257Q

Standard Life plc

19 June 2015

 

Standard Life plc

19 June 2015

David Nish to step down on 5 August 2015

Keith Skeoch to become Chief Executive

The Board of Standard Life plc announces that David Nish is stepping down on 5 August 2015 after six years as Chief Executive and nine years as a Director of the Company and that, following a rigorous succession planning process and regulatory approval, Keith Skeoch, currently Chief Executive of Standard Life Investments, will succeed him as Chief Executive.

The execution of Standard Life's strategy has accelerated over the last year with the acquisition of Ignis Asset Management and the disposal of its Canadian companies. Over recent months David and the Standard Life Board have been discussing the development of our senior leadership and succession planning to continue the delivery of our strategy. In light of this, the Board and David have agreed that this is the right time to hand over to his successor.

Sir Gerry Grimstone, Chairman said:  "David has shown great leadership over the last six years and the outstanding progress we have made in that time has been achieved through his incredible drive and determination. He has changed the shape of Standard Life allowing us to successfully grow globally through world class investment management and distribution businesses. On behalf of the Board I would like to say thank you and pay tribute for all that he has achieved. He leaves the business in extremely good shape with a clear and successful strategy, strong operational performance and a depth of leadership talent.

"I am very pleased that Keith Skeoch is to become our new Chief Executive. He's been an integral member of Standard Life's senior team over the last 11 years. Under Keith's leadership the asset management part of our group has developed into a leading global player. He has an exceptional understanding of world markets and the opportunities they offer, and has the right talent and experience to continue to deliver our strategy and take Standard Life on the next stage of our journey."

David Nish, said: "One of the most important responsibilities of a Chief Executive is recognising both the right time to pass the baton and also to help ensure it is passed on to the right person. Now is the right time for both the group and myself. It has been an absolute privilege to lead Standard Life for the last six years and to help build our business into the strong global player it is today.

"I'd like to take this opportunity to thank every single person who has helped to make Standard Life the company it is today. The business is full of inspirational people who work hard every day to do the best that they can for our customers and clients. Our people are truly the best.

"For me it will be a time of mixed emotions as I prepare for a new future, however I know that Standard Life is in good hands. Keith is the right person to continue to deliver on our strategy and I wish him every success for the future."

Keith Skeoch said: "I am delighted to have the opportunity to lead Standard Life. Standard Life has been both transformed and simplified in recent years. This has put the fundamentals in place to build a world class business with investment management at its heart, serving savers and investors through our strong and innovative distribution channels. It's a great honour to have the responsibility for the next phase of our growth and I'm excited by the challenge.

"I'd like to thank everyone across the business who has worked so hard to make this possible and David for handing the company over in such strong shape."

Keith will continue in his role as Chief Executive of Standard Life Investments until a transition is effected.

For further information please contact:

Institutional Equity Investors
Jakub Rosochowski*	0131 245 8028 / 07515 298 608
Neil Longair*	0131 245 6466 / 07711 357 595
Media Relations
Steve Hartley*	0131 245 1365 / 07702 934 651
Barry Cameron*	0131 245 6165 / 07712 486 463
Tulchan Communications	020 7353 4200
Corporate Communications
Graeme McEwan*	0131 245 5593 / 07734 974 026
Group Secretariat
Kenneth Gilmour*	0131 245 0751

* Calls may be monitored and/or recorded to protect both you and us and help with our training. Call charges will vary.

Notes to Editors

Transformation since 1 January 2010

All 2014/2015 figures are on a 'continuing operations' basis and exclude Canada. All 2009 figures include Canada.

1.   Market cap and shareholders returns

·     Market cap - £9.3 billion (18 June 2015) vs £4.8 billion (31 December 2009)

·     Returned £3.7 billion to shareholders since 1 January 2010

·     2014 final dividend per share of 17.03p, up 39% since 2009 (12.24p)

·     Total Shareholder Return since 1 January 2010 - 191%

2.   Assets under administration up by 83%

·     Group AUA -- £311.9 billion (31 March 2015) vs £170.1 billion  (31 Dec 2009)

·     SLI AUM - £258.4 billion (31 March 2015) vs £56.9 billion (31 Dec 2009)

3.   Transformation to a leading global investment savings provider

·     Sale of Standard Life Bank to Barclays in January 2010 for £226 million

·     Sale of Standard Life Healthcare to Discovery in July 2010 for £138 million

·     Acquisition of Newton Private Clients in September 2013 for £83.5 million

·     Acquisition of Ignis Asset Management in July 2014 for £390 million

·     Sale of Standard Life Canada to Manulife in January 2015 for £2.2 billion, of which £1.75 billion returned to shareholders

4.   Business highlights

·     In 2014, 69% of Standard Life Investments' third party net inflows (excluding Ignis) from outside the UK

·     Strategic partnerships with Manulife, John Hancock, Sumitomo Mitsui, HDFC, TEDA and Phoenix

·     Strong investment performance - Standard Life Investments' third party AUM above benchmark: 73% (1 year), 94% (3 years), 89% (5 years)

·     Over 600,000 additional employees saving through auto enrolment

·     Number of advisers using our UK Wrap platform increased to 1,340 (2009: 583)

·     UK SIPP AUA of £26.2 billion with over £11 billion of assets in our market-leading Drawdown proposition.

·     Standard Life signed a three year partnership with Andy Murray in 2014

·     Standard Life Investments is the worldwide sponsor of the Ryder Cup (2014 and 2016)

5.   Sustainability

·     Introduced the Living Wage in 2012 and became accredited in May 2014

·     Youth unemployment champion through various initiatives, including the Edinburgh Guarantee scheme - in 2009, 0.5% of Standard Life's workforce was under the age of 25, now under 25s account for over 5% of its UK workforce

·     Work with people facing barriers to employment through programmes with Remploy, The Prince's Trust, Tomorrow's People and the Armed Forces

·     In 2014, Standard Life became one of the 12 Social Mobility Champions in the UK, committing to giving opportunities to everyone regardless of age, race or disability

6.   Current Shareholdings (at 18 June 2015)

David Nish	2,399,228 shares
Keith Skeoch	2,024,890 shares

7.   Remuneration

David Nish's remuneration

David's 12 month notice period commences on 1 July 2015. Following our 2015 half year results there will be a seven week handover period and following this David will be on garden leave until 31 March 2016, at which point his employment terminates.

During garden leave David will continue to receive his base salary of £835,000 per annum, his allowances and all benefits in line with the terms of his Executive Service Agreement (ESA).

During this time restrictions are in place on his ability to take up further employment and he will be available for consultation. 

From 1 April 2016 to 30 June 2016 David will be entitled to payment in lieu of notice paid in instalments and subject to mitigation.

Bonus

Reflecting the period of garden leave, which prohibits David from taking alternative employment, he will remain eligible for consideration for payment of a group annual bonus payment for the period of garden leave in line with our normal practice. 

·     The 2015 group annual bonus will be calculated over the period 1 January 2015 to 31 December 2015

·     The 2016 group annual bonus will be pro-rated to cover the period from 1 January 2016 to 31 March 2016 

The 2013 and 2014 deferred bonus awards will vest on termination on 31 March 2016 in line with plan rules.  

Long-term Incentive Plans (LTIPs)

The unvested LTIP grants will continue to vest and these will be pro-rated up to the end of the period of garden leave. These will vest in line with the plan rules on the normal vesting dates and are subject to the company's performance measures:

·     The 2013 LTIP award will vest as normal on 25 March 2016

·     The 2014 Executive LTIP award will be pro-rated (period 1 January 2014 to 31 March 2016) and will vest on 20 May 2019 after the two year holding period

·     The 2015 Executive LTIP award will be pro-rated (period 1 January 2015 to 31 March 2016) and will vest on 27 March 2020 after the two year holding period

David will be required to hold 300% of the value of his base salary in the form of Standard Life plc shares for a period of one year from his termination date. 

Keith Skeoch's remuneration

As part of Standard Life's transition to a global long-term investment savings provider, Keith's remuneration package has been restructured, subject to consultation with our largest institutional investors, to align it more with the asset management industry.  

Salary

With effect from 5 August 2015, Keith will receive base salary of £700,000 as Group Chief Executive. His current base salary as CEO of Standard Life Investments is £500,000.

Bonus

Keith's maximum opportunity under the group annual bonus plan will be 175% of salary, which is the current maximum level for David and the maximum permitted under the remuneration policy.  He will no longer receive a bonus under Standard Life Investments' personal and company bonus plans.

Long-term Incentive Plans

Keith currently has a potential LTIP of 400%. Our remuneration policy, approved by shareholders at this year's AGM, now allows payments of up to 500%.  The Remuneration Committee is proposing an increase in Keith's potential LTIP to 500% under the Executive LTIP and will now consult with our major institutional shareholders. This rebalances the package towards long-term remuneration. 

The Remuneration Committee has also increased the shareholding requirement for Keith from 300% to 500% of the value of base salary during employment and for a period of one year following his departure from the group.

The base salary increase and change to the group annual bonus arrangements will come into effect on 5 August 2015 and will be pro-rated accordingly in 2015. The change to the Executive LTIP will come into effect in 2016 and no further grant will be made in respect of 2015. 

Full disclosure of these remuneration arrangements will be provided in our Directors' Remuneration Report in our Annual Report and Accounts 2015.

8.   About Standard Life

Standard Life is a long-term investment savings business dedicated to helping build a more prosperous world. This has been important to them since they were established in Edinburgh in 1825.

Since then, they've been growing globally. Today, the Standard Life group employs around 6,500 people internationally - through businesses in the UK, Europe, North America, Asia and Australia.

Around 4.5 million customers worldwide trust them with their financial future - and they're responsible for the administration of £312 billion of their assets. They support a further 20 million customers through its Chinese and Indian joint venture businesses. The Standard Life Investments brand also offers truly global asset management expertise with strong investment capabilities.

Standard Life plc is listed on the London Stock Exchange with around 1.3 million individual shareholders across over 50 countries. And they're one of the top 500 companies worldwide, by revenue, as listed in the 2014 Fortune Global 500.

Wherever they operate in the world, they're motivated by a sense of responsibility. It's what helps them to be a sustainable business. They're proud to be listed as a leader for corporate sustainability in their industry in the Dow Jones Sustainability Indices (DJSI World and DJSI Europe).

(Figures at 31 March 2015)

9.   Biographies

David Nish

David was appointed Chief Executive on 1 January 2010 after joining Standard Life on 1 November 2006 as Group Finance Director.

David is the Deputy Chairman of the Association of British Insurers. He is a member of the Financial Services Advisory Board in Scotland and a member of the Advisory Council of TheCityUK.

He sits on the Board of HDFC Life in India, one of the country's largest private insurers. He is a Non-Executive Director of the UK Green Investment Bank and is a member of the Chairman's Advisory Committee of Scottish Rugby Union.

From 1999 to 2005 David was Finance Director at Scottish Power plc, and subsequently, he was Executive Director, Infrastructure Division, Scottish Power plc. Previously he was a partner with Price Waterhouse.

From 2005 to 2011, David sat on the Board of Northern Foods plc as non-executive director and chairman of the audit committee. From 2001 to 2002 he served as non-executive director of Thus plc: and from 2002 to 2008 was a non-executive director of the Royal Scottish National Orchestra. In 2000 and 2009 he was awarded the Scottish Business Awards Finance Director of the Year and from 2004 to 2005 he served on the Government Employers Pension Task Force.

David graduated from Glasgow University in 1981 with an accounting degree (B.Acc).

He is a member of the Institute of Chartered Accountants of Scotland.

Keith Skeoch

Keith was appointed Chief Executive of Standard Life Investments in 2004 after joining as Chief Investment Officer in 1999. He has been on the Board of Standard Life plc since 2006.

From 1980 to 1999, Keith was with James Capel (HSBC Securities from 1996) where his previous roles included; 1998 Managing Director of International Equities, 1993 Director of Economics and Strategy, 1984 Chief Economist and in 1980 International Economist. Keith started his career in 1979 at the Government Economic Service.

Keith has held a number of key industry appointments and responsibilities. He is a board member of the Financial Reporting Council and the Investment Association.

Keith has been awarded honorary doctorates from the University of Sussex and Teesside University. These awards are in recognition of his contribution to the financial services industry over many years, most notably in the wake of the global financial crisis where he worked with government and trade bodies in establishing best practice in stewardship and governance.

Keith is a Fellow of the Society of Business Economists, which was given for service to the Economics profession. In November 2013, he was named European Personality of the Year by Funds Europe.

 

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