Standard Life rebel fails to join board

Standard Life, the Scottish mutual insurer, escaped the infiltration of its board by the rebel policyholder Michael Hogan yesterday, but the former investment banker said he would consider mounting an even bigger campaign to secure election at next year's annual meeting.

Standard Life, the Scottish mutual insurer, escaped the infiltration of its board by the rebel policyholder Michael Hogan yesterday, but the former investment banker said he would consider mounting an even bigger campaign to secure election at next year's annual meeting.

Mr Hogan received 67,000 votes, more than 100,000 fewer than Hugh Stevenson, the board member with the lowest number of votes. But he said the considerable support he had received on the back of a relatively low profile campaign would be likely to up the ante next year.

"It's certainly not over," he said. "The fact that 67,000 people voted for me is very significant - it shows that there are at least 67,000 unhappy policyholders out there, and probably a lot more. I want to pause and consider the implications of this vote, but bearing in mind this was a very low-cost campaign which I funded myself, suggests that on a more level playing field I could turn this result around [next year]."

The vote came at the end of an eventful AGM in Edinburgh, which saw a turnout of about 1,000 policyholders, a record. As Standard began its campaign to persuade policyholders to support its demutualisation, planned for next April, many members expressed their dissatisfaction with the insurer's investment performance over the past few years.

One angry policyholder, who said he was sitting on a £19,000 shortfall in his endowment policy, criticised the board's remuneration packages. "If I was a director in industry and I'd [delivered performance like Standard Life], I wouldn't be looking for a bonus, I'd be looking for a P45."

Although Sandy Crombie, Standard's chief executive, gave up his bonus for 2004, he has come under fire for accepting an increase in his pension of more than £1m.

Speaking before the AGM, Mr Crombie said demutualisation was essential to ensure that the company has easier access to raising capital.

Reporting a 3.6 per cent fall in first-quarter sales, Mr Crombie conceded that new business levels were expected to continue falling throughout 2005, as the group changed its focus to writing profitable business, rather than simply chasing market share.

Last year, Standard announced that it was cutting 2,200 jobs in the run-up to its demutualisation and planned flotation next year.