OLD MUTUAL chairperson Trevor Manuel received a 9.7 percent increase in his annual fees in the financial year to April 1, 2021, much higher than inflation but also, a year during which the group, which has more than R1.3 trillion under management, managed to perform strongly against the Covid-19 impacted 2020 financial year.
The group also released a substantial 58 page remuneration report with its annual report on Friday - the group has in the past come under fire from its shareholders at annual meetings regarding its remuneration policies.
The reported showed that executive’s remuneration, including the short and long term incentives, increased by around 20 percent for some directors and prescribed officers and declined marginally for three out of ten of them.
Old Mutual Investments managing director Khaya Ghobodo received a 102.2 percent increase to R13.93 million in total.
Ghobodo said in the remuneration report Old Mutual Investments had “an excellent 2021”, and its various businesses continued to focus on growing assets and new revenue.
Results from operations at Old Mutual Investments were more than 100 percent higher than the previous year and 10 percent above 2019 levels, as mark to market losses on Specialised Finance were not repeated, and annuity revenue improved.
The market had recovered in the 2021 financial year to pre-Covid-19 levels, which, combined with positive flows in the asset management business, drove a 15 percent increase in assets under management.
The investment performance also improved, “with top quartile performance over the past 12 months.” Gross flows of R49.5 billion are 9 percent ahead of prior year. Futuregrowth had a strong second half of the year with more than R14bn of inflows.
Annuity revenue recovered strongly, 14 percent ahead of the prior year.
CEO Iain Wlliamson received a 23.4 percent increase in remuneration to R15.26m.
He said in the remuneration report results from operations increased by 164 percent to R4.4bn, despite a R4.7bn direct Covid-19 impact during the year.
Gross flows had increased by 4 percent to R194.8bn due to strong inflows in Old Mutual Investments and Wealth Management. There had been a strong recovery in the group’s life businesses in South Africa.
Further optimisation of the balance sheet was undertaken with the Nedbank unbundling, returning R10.7 billion to shareholders.
The report said the directors' and prescribed officer's remuneration had been benchmarked against that of competitors including Discovery, Liberty, Momentum Metropolitan, Sanlam, Absa, FirstRand, Nedbank and Standard. The group was budgeting for a 4-5 percent increase in the executive and prescribed officers fixed salaries for the 2022 financial year.
Manuel said in the annual report that addressing climate change had become a top priority for the group. Accountability had been formalised at board and executive committee levels.
He said they were proud of the group’s membership in the UN-convened Net Zero Asset Owner Alliance and Net Zero Asset Managers Initiative. The group also provided a Sustainability Report and Climate Report.
“We remain cautiously optimistic of continued growth in 2022, albeit at a slower pace than 2021. Our business has been substantially rectified, emerging a lot simpler and more efficient than it was only a few years ago,” he said.
edward.west@inl.co.za
BUSINESS REPORT ONLINE