LV= on board with £515,000 bonus for boss despite shambles of failed sale
Mark Hartigan had his bonus for 2021, members of LV= may feel, when he got to keep his job as chief executive despite overseeing the shambles of the failed £530m sale of the mutual insurer to US private equity firm Bain Capital. That misadventure, remember, ended last December in humiliating fashion: the board, despite throwing the kitchen sink at its proposal, couldn’t get enough members to vote for it.
A rapid clear-out of directors followed, with chairman Alan Cook heading for the exit, but Hartigan somehow escaped the cull. Now he’s popped up with a £515,000 bonus for his efforts in 2021. The award wasn’t a maximum jackpot (he slipped up on employee engagement, for example) but two-thirds ain’t bad after a year like the one LV had.
Yes, as the remuneration report makes clear, the organisation hit its trading targets in areas such as capital generation and volume of new business, but the critical number was surely the £33m that was blown on the fruitless “strategic review” that backed the Bain sale. Members have got precisely nothing for their outlay on consultants and advisers.
Instead, under Hartigan, LV= has moved full circle. The business was supposedly strong after selling its general insurance operations, meaning car and home policies, to Allianz for £1.1bn. Then, after the strategic review, the conclusion was that “business as usual does not work” and surrender to Bain was the best bet. Now, with a straight face after a year spent promoting demutualisation, Hartigan says LV= looks forward to being part of “a vibrant mutual sector”.
A humbler chief executive would have let the dust settle and accepted that this was not a year to take a bonus. A wiser board of newcomers would have given him no choice.
Round numbers in
Read more on theguardian.com
