AGM alert: Aviva, GSK, BAE Systems

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Amanda Blanc’s success as Aviva (LSE:AV.) boss is set to be rewarded with a lucrative new pay deal after the insurer updated its remuneration policy a year earlier than planned.

The proposed changes to bonus and long-term incentive opportunities will increase her total target remuneration by about 26%, with the potential to receive up to £11 million in the event of further outperformance and £14.2 million with 50% share price growth.

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Aviva, which is upping its incentives for the first time in over a decade, said it was in the interests of all stakeholders that remuneration for executive directors is competitive.

The remuneration committee points out that Aviva has delivered a total shareholder return of 253% since Blanc’s appointment in July 2020 and that its market capitalisation has increased from approximately £11 billion to about £20 billion.

Aviva shareholders will be asked to vote on the new remuneration policy at the company’s AGM in York on 6 May.

GSK (LSE:GSK), which holds its meeting on the same date, has highlighted a three-year plan that moves the pay package of new CEO Luke Miels closer to its market rivals.

GSK

When: 2.30pm, Wednesday 6 May

Where: London Marriott Hotel Grosvenor Square, Grosvenor Square, London, W1K 6JP.

How to participate: Shareholders can join the AGM either electronically or in person. Proxy voting instructions should be returned no later than 2.30pm, Friday 1 May. Questions submitted by then will be answered during the Q&A session. More AGM details can be found here.

Who’s in the chair? Jonathan Symonds was appointed to the board as chair in September 2019. His previous roles have included as chief financial officer of AstraZeneca and Novartis.

How did the company do in 2025? Sales of £32.7 billion rose 4% on a year earlier, or by 7% at constant exchange rates. Core operating profit of £9.87 billion improved 11% at constant currency, driven by specialty medicines and vaccines growth. Core earnings per share lifted 12% to 172p. A fourth interim dividend of 18p a share is due to be paid on 9 April, increasing the total for the year by 8.2% to 66p a share.

How have shares performed? Up 35% to 1,824.5p (2,107p on Wednesday).

How much was the former boss paid? Emma Walmsley got a total of £15.68 million in her final year as chief executive, up from £10.6 million in 2024 and the highest sum since she took on the role in March 2017. This included cash and deferred shares worth £3.5 million after the annual bonus scheme paid 82% of the maximum opportunity. The 82% vesting of long-term incentives contributed £10 million to the overall figure, including £3.08 million due to share price appreciation over the period.

What about her leaving arrangements? Walmsley stepped down as CEO on 31 December, but will support her successor in a transition period up until 30 September. She will continue to receive her salary until that date and be eligible for a time pro-rated bonus at the ‘on-target’ level of 150% of salary. She will remain subject to the 7.25 times salary share ownership requirement for two years after her departure. GSK will continue to provide or reimburse the costs of private medical support for Walmsley and her family for up to three years from the end of her employment. This ceases if she commences a new role with equivalent provision.

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How much is the new boss paid? Former chief commercial officer Luke Miels receives a base salary of £1.375 million, representing a 4.1% decrease on the amount paid to his predecessor.  He will broadly receive the same terms as Walmsley, which are up to three times salary for the maximum bonus and a long-term incentive plan grant of shares equivalent to 7.25 times salary. His total on-target compensation is £8.4 million.

How does GSK pay compare? Walmsley’s on target remuneration opportunity for 2025 of £8.8 million was about 82% of the global biopharma median at £10.8 million. This falls to around 78% for Miels, given that this is his first CEO role and there has been peer group increases. Whilst not wanting to “slavishly follow the median”, the remuneration committee said current discounts to its competitors are “much too great” and drive internal compression.

How will his pay package change? Subject to performance, the remuneration committee hopes to increase the CEO’s package in increments to the median of GSK’s peer group by 2028. This is likely to be through a combination of: salary increases above the rate applicable to staff in each of the next three years, as well as an increase to the long-term incentive grant level to eight times in 2027.

How was variable pay determined? The annual bonus scorecard comprised a 25% weighting on each of sales and core operating profit growth, with an outturn of 69.5% of the maximum for these measures. The new pipeline performance metric scored 81.7% of the maximum and personal and strategic objectives the maximum. Long-term incentives granted in 2023 at a price of 1,501p were subject to five performance measures, all of which vested to some extent. GSK ranked in fifth position against a pharma peer group of ten companies, resulting in a vesting outcome of 12% out of a possible 30% for this component. Over the three-year performance period, the pipeline delivered maximum performance.

How did last year’s AGM go? The three-year remuneration policy, which increased the CEO’s maximum multiple under the long-term incentive scheme from six to eight times salary, was approved with 93.1% of votes in favour. The annual remuneration report got 92.5% support.

What’s happening with fees for non-executive directors? GSK intends to introduce a committee membership fee of £25,000 a year for members of the Audit & Risk, Remuneration, Corporate Responsibility and Science committees. The fee for the Remuneration committee chair is set to double to £80,000, which is in line with the sum already paid to the Audit & Risk chair. The fees for leading the Corporate Responsibility and Science committees is planned to rise from £40,000 to £55,000. The standard non-executive director fee remains at £122,258, while the board chair’s fee is to rise to £826,400 from £800,000 in 2025. The proposed revisions to the directors’ remuneration policy will also see the minimum share ownership requirement for non-executive directors rise from one times to two times their standard annual fee.

Why the changes? A review identified that fees were significantly less than the peer group median. In some cases GSK directors received less than 50% of the median and in certain cases less than 75%. The main differences were in terms of the payment of committee membership fees and the inclusion of a specific equity component at many of the peer companies.

How’s the company doing on diversity? The 12-strong board continues to meet listing requirements, with five female directors including one in a senior role. Three directors are from an ethnic minority background.

Aviva

When: 9am, Wednesday 6 May.

Where: Aviva, Wellington Row, York, YO90 1WR.

How to participate: Aviva said its choice of venue reflected both its regional heritage and aim to make attending in person easier for shareholders across the country. The meeting will be available online, with the ability to vote and ask questions. Proxy voting instructions should be returned no later than 9am, Friday 1 May. More AGM details can be found here.

Who’s in the chair? George Culmer, the former chief financial officer of Lloyds Banking Group, has been in the role since May 2020.

How did the company do in 2025? Operating profit rose 25% to £2.2 billion, including £174 million from the recently acquired Direct Line business as Aviva achieved its £2 billion target a year early. Cash remittances rose 4% to £2.08 billion, taking the total since 2024 to £4.1 billion as part of a three-year target of £5.8 billion. Earnings per share rose 17% to 56p, while the solvency ratio of 180% was in line with previous guidance. A dividend of 26.2p a share is due to be paid on 14 May, resulting in a 10% increase in the total for the year to 39.3p a share.

How have shares performed? Up 46% to 684.4p (619p on Wednesday).

How much is the boss paid? Amanda Blanc’s remuneration of £9.76 million compared with £7.8 million the year before. The total included the maximum annual bonus of cash and deferred shares worth £2.46 million, plus £5.89 million from long-term incentives after a vesting outcome of 81% was accompanied by £2.26 million of share price growth. Blanc’s salary for 2026 increased 3% to £1.27 million. 

How was variable pay determined? The maximum result was achieved for cash remittances, solvency and group adjusted operating profit under the financial part of the bonus scorecard. The CEO’s overall outcome of 94.7% of the maximum - or 189.3% of salary  - was then subject to an upward adjustment based on the remuneration committee’s view of her contribution and achievements. In recent years adjustments for executive directors have ranged from minus 17.5% to this year’s plus 35%, with the upper limit still being 200% of salary. Total shareholder return of 92.2%, which compared with 48.5% for the FTSE 100 and 60.2% for Aviva’s peer group median, vested at 31.4% out of the maximum 40% under this part of the long-term incentive scheme.

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Why is the remuneration policy being updated a year early? A review concluded that while the overall framework remains fit for purpose, there is a need to address the current market positioning for both executive director roles. The remuneration committee added: “As we have migrated to a diversified and capital-light business model, Aviva is now a materially different company. This is the right time to ensure that the current remuneration framework remains appropriate.” The company pointed out that Blanc’s average single figure over the 2021-24 period was £5.7 million, which places her remuneration below the upper quartile. In that time Aviva has delivered an upper quartile performance against the FTSE 11-50, with total shareholder return of 253% since Blanc started in the role in 2020.

How is the policy changing? The proposals include an increase in CEO’s maximum annual bonus opportunity from 200% of salary to 250%. The annual grant of long-term incentive shares is set to move from 350% to 500% of salary. Aviva said this will ensure that upper quartile reward is available for delivering sustained out-performance. The changes will take the CEO’s maximum opportunity in relation to 2026 to £11 million, rising to £14.2 million in the event of 50% share price appreciation.

What about incentive metrics? The annual bonus will include an increased weighting towards operating profit, which reflects Aviva’s shift to a capital-light model. And as Aviva is increasingly being compared to European multi-line peers, it will use Allianz, AXA, and Zurich in its peer group for relative total shareholder return in the 2026 long-term incentive award.

How did last year’s AGM go? The annual remuneration report was approved with 96.88% of votes in favour. The 2024 AGM voted 97.6% in favour of the new three-year remuneration policy.

How’s the company doing on diversity? The representation of women on the board at the end of 2024 was 46.2%, including the roles of CEO and chief financial officer. The company meets the Parker Review target to have at least one director from an ethnic minority background.

BAE Systems

When: 9.30am, Thursday, 7 May.

Where: On the Lumi online platform and at Hall 1, Farnborough International Exhibition and Conference Centre, Farnborough, Hampshire GU14 6TQ.

How to participate: As the meeting will be optimised for an online experience, neither the board nor management will be present in person and will instead take part in the AGM electronically. Proxy voting instructions must be registered by no later than 9.30am, Tuesday 5 May. More AGM details can be found here. 

Who’s in the chair? Cressida Hogg was appointed in May 2023. Much of her executive career was spent with 3i Group.

How did the company do in 2025? Sales of £30.66 billion rose 10% on a constant currency basis, with order intake up £3.1 billion at £36.8 billion. Underlying earnings lifted 12% to £3.3 billion or 75.2p per share, while free cash flow was strong at £2.16 billion. A dividend of 22.8p a share is due to be paid on 4 June, resulting in a 10% increase in the 2025 total to 36.3p a share.

How have shares performed? Up 49% to 1,714p (2,295p on Wednesday). BAE Systems (LSE:BA.) said £100 invested in its shares on 31 December 2015 would be worth £488.34 at the end of 2025, compared with the £233.15 if invested in the FTSE 100.

How much is the boss paid? Charles Woodburn’s total remuneration of £12.4 million rose from the previous year’s £11.68 million after BAE achieved a near maximum result in terms of variable pay. The annual bonus contributed £2.8 million based on 99.5% of the maximum opportunity, while £3.7 million share price appreciation meant fully vested long-term incentives added £8.1 million to the overall total. These shares are released after a further two-year holding period. Woodburn’s base pay in 2026 has increased by 3% to £1.31 million, with US chief executive Tom Arseneault receiving a 4% rise to $1.19 million.

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How was variable pay determined? The company beat stretch targets for underlying earnings per share, free cash flow and order intake, while the remaining 25% of the annual bonus was based on key strategic objectives. Among the six key performance indicators used for the vesting of long-term incentives, average earnings per share growth of 11.9% came in above the 7% stretch target. Total shareholder return of 136.8% beat the top end target of 97.5% and made BAE one of the highest performing shares in the FTSE 100 index.

How did last year’s AGM go? The new three-year remuneration policy, which increased the CEO’s maximum long-term incentive grant of shares from 370% to 500% of base pay, got 97.97% support. The policy was updated a year earlier than usual after the company warned that the current opportunity had fallen below the UK market levels needed to compete for talent. The policy also removed the restriction that “no role will have a salary greater than the chief executive”. The annual remuneration report was approved with 96.59% of votes in favour.

How’s the company doing on diversity? A recent retirement means the board now has less than 40% female representation, although two senior positions are held by women. At least one board member is from a minority ethnic background.