Good afternoon, everyone. I'm Douglas Flint, chairman of Standard Life Aberdeen, and it's my great pleasure to welcome you to our 2019 annual general meeting here in Edinburgh. This is my first AGM as the company's chairman, having taken on this role at the start of the year. I've been looking forward to meeting you and talking with you here today. This is a great company with a great future, thanks to the hard work and dedication of everyone who works here, and the continuing support of our clients and you, our shareholders. I'm very proud to be taking over from my predecessor, Sir Gerry Grimstone, to lead the process of achieving our ambitions, to deliver the kind of value that you, as our shareholders, expect from us.
Before we get started, I'd like to say a quick thank you for bearing with us through the new security measures here today. As you may have noticed, these have been enhanced since our last shareholder meeting. I'm afraid this is a sign of the times, but it's for our collective benefit. Also, before we proceed, can I also ask if you could ensure that any mobile devices you have, like phones and tablets, are turned off, set to silent, or if you have it, to airplane mode, please. Thank you. The quorum needed to run our shareholder meeting is clearly met, we'll continue. I'm going to kick off today's AGM by introducing you to the members of the board who are with me today. I'll start on my far right with Martin Pike who's the chair of our Risk and Capital Committee.
Next to Martin is Jutta af Rosenborg. Next, we have Melanie Gee, who alongside our other board duties, has taken on the responsibility of representing the employee voice in the boardroom, a new corporate governance requirement. We have Simon Troughton, our deputy chairman and senior independent director. Next is Martin Gilbert, who's the vice chairman of Standard Life Aberdeen now and chairman of Aberdeen Standard Investments. On my immediate right is our company secretary, Kenneth Gilmour. Moving over to the far left, we have Rod Paris, our chief investment officer. Next is Cathleen Raffaeli, a new face who joined the board in August last year. Next to her is John Devine. John chairs the audit committee. We have Bill Rattray, chief financial officer. Next to him is Richard Mulley, who chairs the Remuneration Committee. On my immediate left is Keith Skeoch, our chief executive.
Before we move on, there are a number of board members who are stepping down from the board after today's meeting, I'd like to take a few moments to give my thanks to them. First of all, Simon Troughton, our deputy chairman and senior independent, will retire after 10 years combined service to our board and prior to the merger of that of Aberdeen. Simon has been a valuable member of the board, I very much personally appreciated the counsel that he has offered to me as the incoming chairman. Next is Richard Mulley. Richard served as a director of Aberdeen from 2012 before being appointed to the combined board at the time of the merger. He's very ably chaired our Remuneration Committee since his appointment, which is an increasingly complex responsibility.
Finally, after an outstanding career with our companies, a remarkable 34 years to be precise, Bill Rattray will retire from the board on the 31st of May. Bill was appointed to our board and as Chief Financial Officer in August 2017, having been finance director at Aberdeen since January 1991. Bill, Simon, Richard, on behalf of the board and our shareholders, my thanks to each of you for the considerable contribution you've made during your years of service. Please join me in thanking them. With Simon and Richard stepping down from the board today, I'd like to say a few words on our board succession planning processes. The roles of senior independent, held by Simon, and chair of the Remuneration Committee, held by Richard, are clearly key governance positions.
It is critical that we identify and secure the very best candidates with the right skills and global experience to succeed them. Ideally, at the same time, advancing our overall commitment to strengthening diversity and inclusivity on the board. Since I became chairman, I've been working closely with the Nomination and Governance Committee and using an external headhunter to consider potential candidates, and we are now at the final stages of meeting the shortlisted candidates to assess their suitability for these roles. The process of finding the right candidate does take some time, but it is worth taking that time to structure a board which continues to be strong and high-performing.
As soon as we have completed the selection process and the Nomination and Governance Committee has made its recommendations to the full board, we will be in a position to update you, and I fully expect this to be before we announce our interim results. Until this process concludes, the board has agreed to appoint Martin Pike, our longest-serving U.K.-based non-executive director, as our senior independent director. Let us turn our attention to the agenda for today's AGM. I am gonna start by giving a summary of the year that we just had and bring you right up to date with the progress that your company has made towards meeting its strategic aims, the changes we have made, and some of the opportunities and challenges as we look ahead. I am going to ask Keith to share some more detail on our 2018 performance and the factors that played a part in that.
I'll open up the meeting to questions from shareholders. Once that is finished, we will proceed with the voting on the resolutions, which we published in early April in our AGM guide. Once the results are confirmed, we will close the AGM, and we will adjourn back downstairs, where we will offer you some light refreshments, and you will have an opportunity to meet individual board members. So that is today's agenda. Ladies and gentlemen, I'll begin with a look back at the year your company has just had. It has been a challenging year, one where investment performance has been tested by the prevailing geopolitical and market environments. In many ways, however, these conditions play to our strengths as an active fund manager, and we are beginning to see benefits from our long-term approach. What has remained consistent is the scale of this company's ambition.
It's one of the things that attracted me to join, and it's an ambition that's truly global. There are some very good growth opportunities in our markets in the U.K. We have a strong presence in Europe. We're developing important capabilities in America. Our markets in Asia Pacific too continue to provide significant opportunities. For example, in March this year, Heng An Standard Life, our Chinese joint venture with Tianjin TEDA International, was granted permission to establish a pensions insurance company in China, a country where the pensions market is continuing to develop. In the last couple of months, we've also completed two offers for sale of shares in HDFC Life, the insurance business we co-founded in India with HDFC Limited. This take-up has allowed HDFC Life to achieve its minimum public shareholding requirement of 25%.
The two public offerings this year have realized in excess of GBP 500 million for us, which is a significant premium over our cost and bolsters our capital strength. I think that the product and solutions capabilities, combined with the ambition we have and the geographic opportunities available to us, offer us the potential to become one of the world's leading investment companies. The focus of our ambition has driven the actions taken to reshape the business over the last two years. The merger of Standard Life and Aberdeen Asset Management, and the sale of the U.K. and European insurance businesses to Phoenix Group were both substantial undertakings. They marked the culmination of a significant transformation for our businesses. The result is a simpler business model, a more modern corporate structure with opportunities for greater operational efficiency.
It's given us the capital strength that allows us to invest for future business growth. While things may look different in terms of structure, at the heart of what we do, the same primary focus remains, which is to deliver value for our shareholders by delivering what's required to meet the changing needs of our clients and customers. This is particularly important at a time where our industry is continuing to evolve. The changing landscape of pooled pension provision means that many more people now face the challenge of taking much greater personal responsibility for securing their long-term financial needs. To maximize the opportunities from this evolving landscape, you will have seen that we've made some changes to our top management structure.
Our co-CEO arrangement, which was put in place at the time of the merger to facilitate the coming together of two successful organizations, has worked well, such that that integration is now around 75% complete. Once we had the operational framework to work together as one organization, it made sense also to simplify our decision-making structure. As such, Martin Gilbert and Keith Skeoch instigated discussions with the board around the structure that would be best placed to deliver our ambitions going forward. As you will have seen, Keith Skeoch has become the sole Chief Executive, and his main focus is on leading the business to ensure that we have all the resources and capabilities needed to deliver the required investment performance, as well as overseeing the continuing process of transition and transformation. Martin Gilbert's new role is as Vice Chairman of Standard Life Aberdeen and as Chairman of Aberdeen Standard Investments.
In this role, he's able to focus exclusively on the client-facing aspects of our business. That's vitally important because it encompasses all the important strategic relationships that we have around the world, contributing to the winning of new business and realizing the potential from our global network. In addition to the new top management structure, I'm very pleased that we've been able to make new appointments that add to the perspectives and industry knowledge that the board has to draw on. This August, as I mentioned, we welcomed Cathleen Raffaeli to the board, who brings huge knowledge from the U.S. of financial technology and high-tech service companies, and therefore is an important addition to the board. I'm delighted that Stephanie Bruce has agreed to join the board and take up the position of Chief Financial Officer.
Stephanie brings great knowledge of technical reporting and commercial practices within the financial services industry in a career that spans more than 25 years. She'll take up the position on the 1st of June, subject to satisfying all the relevant regulatory requirements and processes. We'll be asking you to vote later on in both Stephanie's and Cathleen's additions to the board. Later in this meeting. I think the business can be very proud of what it's achieved during a period of such fundamental change and in such challenging market conditions. However, we'll be the first to agree that our share price has not been where we would have wanted it to be over the past year or indeed today. Clearly, there have been sectoral factors outside our control which have impacted investment sentiment and therefore investment flows, much of which can be attributed to geopolitical developments.
Obviously, these include the trade tensions currently between the U.S. and China, and of course, the uncertainty over the form that Brexit will take. I'll come back to that a little later on in the meeting. While external factors such as these have undoubtedly had an impact, there have also been factors that are specific to ourselves. A principal element has been investment performance in some of our largest strategies, which has led to elevated and continuing outflows. A turnaround in performance measured over longer time frames may take some time, but there are now signs of recent improvement in equity investment performance and stronger short-term momentum in absolute return strategies. Keith will talk in more detail about our performance in 2018.
Another key factor last year was the statement from Lloyds Banking Group in Scottish Widows-- excuse me, in February, where they said they intended to end their agreement with us to manage their funds. Now, we did not believe that they were entitled to give notice to this effect as we did not consider the two groups to be in material competition, which the basis on which they sought to terminate the agreement. As you'll be aware, we therefore challenged their right to do this. The parties began an arbitration process, in March this year, an independent tribunal agreed with our position, and we're now working to bring this matter to a conclusion, including considering the appropriate level of compensation which is due to Standard Life Aberdeen. Now, let me pass over at this point to Keith to offer his reflections on the year just past. Keith.
Thank you, Chairman. Over the next five to ten minutes, I'll give you a brief overview of how we performed in 2018. 2018 was one of the most challenging years the industry has faced in over a decade. Our reaction to that challenging environment was to focus on what we are able to control in order to deliver our strategic transformation and achieve that long-term ambition of creating a world-class investment company. I believe that we delivered a resilient performance that was built on strong foundations. We maintained our focus on financial discipline, delivering for our continuing businesses a similar level of operating profit to 2017. This was helped by a reduction in operating expenses of 10% and the fact that our integration program is 75% complete and ahead of schedule. We also continued to build strong relationships with our clients and our customers.
Investment performance is starting to show signs of improvement. We remain positively viewed by many consultants. As a result of the relationships we're building, we now expect to have potential access to 16 million customers through the new relationships with both Phoenix and Virgin Money. We also continue to invest in our future through innovative fund launches and bolt-on acquisitions to bolster our already extensive investment capabilities. Finally, as Sir Douglas points out, we remain very focused on creating value for our shareholders as we reshape our business to take advantage of the forces that continue to disrupt the industry. To that end, in a very challenging environment, we also completed the transformation to a capital light business, returned GBP 1 billion to shareholders in October. We continue to reshape our very strong balance sheet for the benefit of shareholders.
2018 was, as I said, a resilient performance against a difficult industry background. 2018, in many senses, was a perfect storm for our industry, created by some very strong headwinds that are likely to remain with us for some time. There's an unrelenting shift to passive asset management after 16 years of strong equity markets as they recovered from the lows of the financial crisis. Volatile markets in the final quarter of last year have reminded investors about the benefits of active management. We suspect that the move to passive and the pressure on fees that comes with it will be with us for some time. On a more positive note, we are also seeing increased demand around the world for new active investing. New active investing involves the shift from public to private markets, an increased focus on outcome-orientated solutions, as well as very specialist high-performing funds.
Another feature of that perfect storm is the need for scale. Life for those in the middle ground is getting tougher and tougher. Finally, there is the importance of individual savings as we all have to take responsibility for our and our family's financial future. While the industry will remain challenged for some time, we are well-placed, we believe, to weather the storm. We are financially resilient. As a result of our scale and the strength of our balance sheet, we continue to make progress and transform our business in the face of these disruptive headwinds. We continue to invest and develop our new active capabilities within Aberdeen Standard Investments, building on the investment teams that came together as a result of the merger. We are also in a strong, some might argue, unique position to take advantage of the rising importance of individual savings.
We are the U.K.'s number one non-bank savings brand. We have GBP 60 billion of assets under administration on our platforms that serve the retail market across a broad range of segments. Wrap, Elevate, and Parmenion serve the mediated advisor market. 1825 provides financial planning advice, which is expanding our digital capabilities. Our strategic partnerships with Phoenix and the anticipated Virgin Money joint venture potentially brings us access to 16 million customers, around 30% of U.K. savers. These customers will have access to a broad range of offerings throughout the savings ecosystem of asset management platforms and advice. All of which is aimed to bring us closer to our clients and customers and help them invest for a better future. Now, despite that stormy weather, in 2018, we benefited from over GBP 75 billion of gross inflows across our business and its global footprint.
That global footprint means that we have clients in 80 countries and offices in 52 global locations. An improvement on 2017, the GBP 75 billion was also evidence of the strength and resilience of both the brands, Aberdeen Standard Investments and Standard Life, that make up our business. Unfortunately, these were offset by outflows that were concentrated in a small number of investment strategies. While the numbers were large, over GBP 40 billion, the outflows represented less than 7% of our total assets under management and administration at the start of 2018. As Sir Douglas pointed out, investment performance lies right at the heart of what we do, and it's clear that in 2018, our disciplined and long-term approach was tested by what was, I believe, the worst return environment seen since 1901. However, it's also equally important that we challenge ourselves to learn from periods of underperformance.
To that end, where our clients suffered underperformance, our investment teams worked on their performance enhancement plans and focused on reinforcing our strengths in research, idea generation, and ensuring those insights were implemented in portfolios. I'm pleased to say that the combination of this hard work and a distinct improvement in the grain of markets is generating an improvement in investment performance. But I would caution this will take time to feed through to net flows. The message I hope you will take away from this brief overview of our resilient performance in 2018 is twofold. First, we will continue to be relentless in our focus on operational and strategic delivery. Secondly, we have positioned Standard Life Aberdeen to take advantage of the opportunities that the rapidly shifting savings and investment landscape creates.
For sure, there's still a lot of hard work to be done to reshape our business and achieve our long-term ambitions. But we believe that building on the progress we made in 2018, we have the management focus, the capabilities, and the financial strength to capitalize on the disruption in our industry, and make sure that the actions we are taking are for the benefit of our clients, our customers, our people, and of course, you, our shareholders. Thank you very much. With that, I'll hand back to the chairman.
Keith, thank you very much for the update. Can we now turn to look at the dividend that your board is proposing for 2018? The board is proposing a final dividend of GBP 0.143 per share, which is the same amount as the final dividend we paid last year. If you vote to approve this later during today's meeting, this would give a total dividend for 2018 of GBP 0.216 per share, which represents an increase of 1.4% compared to the total dividend for 2017. This dividend, of course, is on top of the capital return we were able to make to shareholders following the sale to Phoenix, which was GBP 1 billion by way of a B share scheme. We've made good progress on our share buyback program, which aims to return up to a further GBP 750 million.
As we look ahead, your board's current attention is to hold the annual dividend per share at GBP 0.216 while the business is transformed, while cost synergies are delivered, and while we work to improve our future financial performance. All these together will help us to assess the sustainability of this dividend level and to determine the potential for its future growth. Let me turn now to our wider role as investment managers. Society's expectations on what companies like ours should achieve have rarely been greater. At this point, I'd like to talk about the topic of corporate sustainability. The financial sector plays an increasingly important role in modern society, and we are rightly judged on much more than the financial returns we generate.
This means addressing a range of responsibilities, not just to clients, customers, and shareholders, but to the people who work for us, the communities around us, and more broadly, the environment. We use various mechanisms to help identify what is expected of us. The UN Sustainable Development Goals, for example, provide a framework that supports our vision of what a better future looks like, and to which we can therefore align our own action plans. We also gain valuable insight from high-profile corporate sustainability indices. We're very pleased with the recognition we received for 2018 in the Dow Jones Sustainability Index, where we were ranked in the top 5% for our sector, and in the FTSE4Good Index, where we were in the top 1% of companies there listed.
These indices review our approach in relation to areas such as corporate governance, risk management, climate change, employee engagement, and the extent to which we consider environmental, social, and governance aspects in our investment processes. In terms of our own business sustainability, long-term success depends on the quality and the commitment of our people. Against the backdrop of such large-scale company changes that we've had in recent times, I've been really impressed by the way in which our employees have absorbed the burdens of change while remaining focused on meeting the needs of our clients and customers. Engaging effectively with our employees plays a crucial role here, and this is a responsibility that we take very seriously.
Following discussion with the Nomination and Governance Committee, I'm very pleased, as I said earlier, that Melanie Gee agreed to take on the role to be the Designated Non-Executive Director to support this important area of work. This is a new formal requirement of the U.K. Corporate Governance Code, working with Melanie, we have put together a program which will support her in delivering this. We want to deliver a culture that's innovative, collaborative, and importantly, inclusive. We've been taking a number of actions relating to inclusion in work and being transparent about the progress we're making. As part of our commitments to the Treasury's Women in Finance Charter, for example, we have a set of targets relating to gender balance, and we publish an update on our progress against these each year.
Following the directorate changes we've announced, assuming they're approved, our board will be made up of four women and six men, which is a very positive development in terms of ratio. We know there's still more to do to improve gender balance across the organization, especially among our senior leadership team. I'm pleased that our transparency has been recognized by our inclusion in both the Equileap Top 200 Global Companies Index and the Bloomberg Gender-Equality Index. We remain committed to reviewing and improving our approach to building an inclusive workplace, and particularly in our oversight and governance of this at a very senior level. Before I round off this part of today's meeting, I'd like to take a few minutes to talk about another issue that's affecting all businesses, and that's the resolution of the Brexit process.
As a global investment company, adapting to regulatory change, working across borders, is a fundamental part of what we do. Our focus has been on how we maintain our service to our clients and customers, and how we navigate the likely impact on markets in which we are invested. The continuing lack of clarity over the timetable, the terms in which the U.K. will ultimately leave the EU, and the framework for any future trade relationships means that we've had to consider a number of different scenarios as part of our Brexit planning to mitigate any potential disruption to our operations. As you'd expect, our priority has been to ensure that we are in the best possible position to provide our customers and clients with continuity of service. That's what they expect from us.
We have already structured the activities and responsibilities of our Dublin and Luxembourg operations so that we can continue serving our clients who require services delivered from within the EU. We will continue to follow developments closely as the Brexit process continues and assess any implications for the arrangements that we have put in place. We hope that when the U.K. eventually does leave the EU, we will do so in as orderly a fashion as possible. While market conditions remain challenging and the economic and geopolitical factors continue to affect investor sentiment, your Board firmly believes that we have the resilience and the capital strength to deal with the challenges that these conditions present.
As we look ahead, I'm determined that we maintain our focus on the things that we can control, which means delivering for our clients and customers by focusing on our investment processes and performance and delivering the products and services that meet the changing needs of our clients. It also means maintaining our focus on driving operational efficiencies and on delivering on the cost savings that we've promised. It means delivering the revenue growth potential created both by the merger and our enhanced strategic partnership with Phoenix. I believe that all of these are the necessary steps in delivering on our strategy of creating a world-class investment company, and that is one that maximizes value and generates sustainable dividends and returns for our shareholders, and one that is also recognized for the broader contribution it makes to a sustainable future for generations to come.
Combined with a continuous eye on improving what we do and how we do it, as well as our range of capabilities and geographic reach, we're well-placed to take advantage of the opportunities in all of our markets. I believe this will keep us on the path to continuing success. At this point, let's proceed to the next part of our AGM, which is our question and answer session. One thing quickly to say before we begin. As shareholders, as I've said, you'll all be aware that a large part of our business historically done by Standard Life has now transferred to Phoenix as we sold that business. This means that many shareholders who are also policyholders of Standard Life are now customers of the Phoenix Group.
I won't be able to help you with individual policyholders questions today, but we're fortunate that we're being joined by customer service colleagues from Phoenix, who are back downstairs and where you can speak to them after the meeting has taken place if you have any queries on your personal policies. Before we begin, so that I can assess the management of the meeting, could I have an idea of how many shareholders would wish to ask a question? Just a quick show of hands. Okay. Thank you. The last request that I would make of those asking questions today is if you could, to help us, tell us first your name and then deliver your question. Who would like to start the ball rolling?
Mr. Baker.
Mr. Baker.
Thanks. My name's Roland Baker. I'm an individual shareholder from Luton. I'd like to welcome Sir Douglas to the board. I'm sure that we pay great tribute to the chairmanship of Gerry Grimstone that brought the company to the position that it is for you to take over. You've already had, I think, some warning in advance of the things I'm about to raise this morning. I agree with your board structures that you've brought into place.
This time next year, obviously, before this meeting, you'll have your own board in place with the new people who will have had a year's time in which to devise some system in which we're gonna become a fleet-of-foot investment manager who might go by a different route. We get there before everybody else and deliver wisdom that is not conventional, because we have to find something that helps us to distinguish ourselves uniquely from everyone else. For example, when I was passing the University of Edinburgh yesterday, somebody put up a slogan saying, "Do you know how much the planet's carbon emissions could be cut by investing in data-driven technologies?" Data being the new oil, I'm assuming we're on our way there. We have to get there before everybody else does and do something unique with it when we arrive.
I'm looking forward to seeing how we are this time next year in terms of the fact that I had a balance sheet in my hands which, instead of having GBP 229 billion worth of assets with a nice lot of deferred acquisition costs I could get my teeth into, was GBP 12 billion and fairly straightforward. I didn't really think when I opened it that I was gonna be out of my depth with such a small number of things. I would like to talk about the audit fees, though, if that's possible. The audit fees we paid KPMG this year, GBP 8 million, largely to help us get rid of Phoenix and send it over and retain our 20% share. The other side of that equation is Phoenix paid Ernst & Young GBP 12.8 million. That GBP 20 million has gone in audit fees on that transfer.
We're now facing the Brydon Review and new regulatory standards that should improve, in inverted commas, the quality of our audits. I'm assuming, or I've been assured that our audit fee is unlikely to reduce, both on account of the structural factors from the new audit requirements and the fact that we've already reduced it because the audit of subsidiaries will be the same. If you could comment on that would be appreciated. I think I'll probably leave it at those two questions. The other things I raised with you before the meeting, I'll take up afterwards.
Okay. Thank you for your questions and for the thought that went into them. I think the first point you make, I absolutely agree with. One of the things we've actually been talking about as a board over the last two days, because we had the meeting this morning and we had a meeting yesterday, is just how far in the future we've got to think about our business. Because the business in five years our industry in five years' time, in 10 years' time, will be very different from what it is today. What does that mean about the technology need, the people that we need, the way we think about our customers, and the way we reach them?
I think there's gonna be a lot more technology, a lot more digitalization, a lot more quantitative techniques, both in our investment processes and in the way we reach our customers. We're thinking very carefully about our platforms business, which is the combination of investment process, investment insight, and reaching through the advise market into those who have to take, as Keith said and I said, much more responsibility for their futures in a world that the paternalism of defined benefit schemes has gone away. I think it's one of the things that attracted me to this company, that we're facing a savings challenge, catastrophe some might say, in 20 years' time if we don't get that message across and help people build the pool of money they need to cope with their retirement and their health needs in due course. We agree with you.
Data has never been more plentiful. We've got to apply ever more sophisticated techniques to provide insights, and to deliver to clients through the institutional markets, but also increasingly directly through the platform businesses. In terms of audit fees. I confess I was an auditor one day. I've been a finance director, now I'm a chairman. I also chaired an audit committee. We will keenly discuss where the audit fees will be next year. Some of the things we had to do this year, we won't have to do next year because things are simpler. On the other hand, as you rightly said, the focus on the auditing profession, and the increased responsibilities, accountability that they've got, I suspect, is going to add to the amount of work that they're going to be required to do.
Our challenge, our opportunity, is to make sure our processes are in as good shape as they can be to simplify what they believe they need to do. Until we know where the Brydon Review goes to in terms of what's expected of the audit profession and where the competition and markets review gets to. As an investment house and a leader in corporate governance, we strongly support anything that improves the quality of audit because we benefit from a robust governance regime around financial markets because we are one of the largest investors in them. Anything that makes audit better, there's a whole range of proposals that have been put out, some of which we think might have an impact, others which need, I think, to be proven.
We will certainly ensure that we understand where the money's being spent, and we have a very robust Audit Committee under John Devine that links with our auditors and makes sure that we understand where they're spending money, why they're spending money, and that we get a very robust review of our financial accounts. Thank you for your question. Is there another question? There's a lady in the paddle two. I've been told to say the number and I forgot the first time around.
Hello, my name is Anne-Marie Williams. I'm here as an appointed representative of ShareAction, who are a shareholder in the company. First of all, I'd like to thank you for your words today on the topic of diversity and inclusion, which I'm about to ask you a question about. I'd also like to thank you for your support with a number of our initiatives, including our Workforce Disclosure Initiative. My question today relates to Standard Life Aberdeen's gender pay gap, an issue which in the eyes of investors as well as the workforce carries a significant reputational risk if not appropriately addressed. To this end, it was encouraging to see the targets which you've set out in your action plan, which when achieved, will go some way towards addressing the company's current mean gender pay gap of 40%.
Providing equitable pay structures and appropriate career progression opportunities at all levels with the flexibility individuals need makes good business sense, both in terms of attracting and retaining workers, and also drawing on the benefits of a diverse workforce. Specifically, I would like to request an update on the progress you've made towards those targets for improved representation. In particular, I'm interested in knowing what percentage of portfolio managers at Aberdeen Standard Investments are women. Is the board happy to publish and track that number over time? How many of the firm's investment teams are gender diverse? Is the board happy to publish and track that number over time and to track other measures of diversity also? Lastly, would you be willing to meet with ShareAction to discuss the firm's overall approach to diversity and inclusion in more detail? Thank you.
Thank you for your question. It's a hugely important subject. Let me answer the last part. Of course, we're prepared to meet with you. I think part of the dialogue helps us all understand the nature of the challenges, the nature of what we're doing about it, and agree where we're moving. The gender pay gap in Aberdeen Standard Investments relates to the same as it does most other places, which is the balance of the more senior roles being held predominantly by males. That's something we are trying to address. We're trying to address it in a number of ways, helping women return to work after a career break for whatever reason, through a number of mentoring initiatives, through more flexible working, and through coaching and training.
As it happens, I don't know the number of the portfolio managers who are female, but let us say we obviously can find that information out. Let me see if we can find that information, and then we can decide whether it's appropriate to share it. I can't see personally why not. As an anecdote, I had a meeting yesterday with one of our top performing teams, top performing strategies. A team of eight, three men, five women. They've just told me they recruited another woman, and it's probably one of our best known and most successful strategies. Six women and three men. Maybe we'll get a question on that in due course. It's been incredibly successful. We're very conscious.
We subscribe to a number of initiatives, Women in Finance Charter, and we provide a great deal of support to all of our employees, but specifically putting in place arrangements to help women get to the levels that their career aspirations should take them and that their skills should take them. It's one of the things that Melanie Gee will be actively keeping an eye on in her new role. Of course, an anecdote of one is a pretty feeble statistic. Bringing Stephanie Bruce onto the board as our most senior female employee is hopefully a symbol of how seriously we take it. Of course, we appointed her because she was the best candidate by a long way for the job.
Having someone in that role at that leadership position who symbolizes the progress that we want to make, I think is very important as an encouragement to others to aspire. We'll hopefully do more in this area. I agree with you, sharing the statistics, publishing targets is the way forward. Now, I don't know, Melanie, if you want to add to anything I've said or correct anything I've said.
No, can't correct it, Chairman.
You all right?
Just to confirm we are Well, and to reemphasize, we are very committed to improving our diversity and inclusion throughout the company at all levels.
This is an industry which lends itself probably as much as anyone else. It's an industry based on human talent and intellectual insight. There's no physical barrier that would create a bias. What we've got to do is unravel some of the unintended barriers that exist, and we're working hard to do that. Is there another question? There's a gentleman, I think number 2's going to get there first.
John Rutherford from Edinburgh. I think it was Lord Nuffield that said, "Better born with common sense than inheritance." I think in this age where common sense is severely lacking in public figures right across the board, Brexit is, if anything, an example of that. They've wasted billions of GBP in contracts they're not even going to use with ferries. Equally well, I live in Edinburgh. There's the Edinburgh trams. They have again, though it was a dead loss to start with financially, they have again spent billions of GBP employing a high court judge that I would have thought to decide what was wrong with it. The people who were wrong with it were surely the people who were in charge of the project.
If we're here at Standard Life's meeting today, if Standard Life goes bust, I think it'll be the people on the platform that generally will be held to blame for it. Right across your board, common sense has actually left the party. My question is, how is it that you are coping with that? That the service and everything in the public sector is so poor. How do you actually cope with that? I'm not making a question about Brexit or anything else, just a generalization.
It's a great observation. I think sometimes we get bound up in technical, sophisticated, complex things, when in fact common sense is an appropriate way of looking at things. Coming back to the first question, one of the things that we're, I think, at the forefront of and take very serious is the whole environmental, social, and governance agenda, which is actually putting corporate activity into the context of social contribution. Putting it through a prism of what is it reasonable to expect within what time frame. There's an awful lot of stuff that's talked about that believes we can get to where we need to get to tomorrow. We can't get there tomorrow. We shouldn't take forever to get there.
I think there's a pragmatism about this company, about the way we approach investments, about the way we hold the companies we invest in to account that is firm and challenging, but also pragmatic. I'd like to say, as a fellow Scot, that being based in Scotland, I think, gives us a dose of common sense that might be missing some other parts of the world. Because I think there is a self kind of criticism that's inherent in all of us. We share that with all of our colleagues. We're always looking to see what we can improve rather than believe that we've got the answers to everything. Certainly speaking on behalf of this board, there's a huge amount of common sense on it. We challenge ourselves. We challenge our colleagues. We challenge the orthodoxy of what other people think of us.
Questions like yours, I think, are really important to us to keep our feet firmly on the ground. Thank you. Is there another question? I'm looking around the room. At the back, Douglas. At the back. Oh, sorry, I got blinded by the light. That was a song, wasn't it? Number one.
Hi. Thank you. Christian Bergen, private shareholder. I'm just curious. I was a former employee of SLI and still have a lot of friends that have recently left and are still in there. General morale seems very low at the minute. People are very unhappy. I just wonder, given the very poor performance, if the board feel that the low morale and being tied up in a lot of corporate actions is having an effect on investment performance, holding onto assets and distribution. Then from there, how they feel that, given the difficulty around the culture, how they then plan to go and create this open, innovative culture from this sort of very tricky situation for the staff on the ground. Thank you.
That's a jolly good executive question. I think I'm going to pass it over to Keith in a minute. Let me say one thing from my own experience, which is, I think, and I've been in a few, I think companies that have gone through significant challenges, whether it's the kind of corporate reorganizations that we've gone through, that have gone through very difficult market conditions, which we're going through just now, that have been through existential threats to their existence, which Standard Life in its history have been through, and organizations I've been on have been through. Those that have been through those experiences and come out the other end, come out stronger because people have bound together in difficult times.
It's kind of easy to be there on a sunny day with the wind in the back, the only thing to think about is whether to put another ice cube in the gin and tonic as the yacht sort of sails slowly through the channel. To have been through a storm when you think the mast might break, do you come through the other side, to get there, to understand what you need to do to get there, the role that you played in getting there, I think creates an organization that's much stronger. Now, we've done an employee engagement survey.
The results are not where we would want them to be, they kind of represent the fact that we're in a difficult industry at a difficult time, and an organization that's coming together and is dealing with a whole bunch of challenges outside the client focus bit. Keith, what are you doing?
Quite a lot. The first thing we are doing is certainly recognizing that there is an issue. As Sir Douglas has pointed out, we are asking an awful lot of our people. We've had a lot of corporate action as we're looking to reshape our business to make sure that we can grow, in the future and negate the impact of those disruptive trends. Last year, as I said, was the most difficult investment environment seen since 1901. If you're involved in the business, that, of course, is quite stressful. A lot of uncertainty our people are coping with. I'd just like to echo what Sir Douglas said earlier. I'm deeply impressed by the resilience of our people and everything that they're looking to deliver. What are we doing? Really, three things. One, we are engaging.
With them on a regular basis, both as executives out there talking about strategy, talking about our vision. Talking, secondly, about our values. We have three values which we're looking to embed within the organization about making connections, adapting and excelling, and delivering what matters. These are the values our people say they want to drive the culture at Standard Life Aberdeen, Aberdeen Standard Investments, and Standard Life. We're working with our people. The third thing is that the board is also making connections. We did something innovative last night, and that was the non-executives actually had an AGM with our people. The executives were not along because it's incredibly important that there's a degree of transparency and openness. Yes, we're doing an awful lot.
It will take time for that uncertainty to resolve itself, it will take a little time for us to embed the behaviors in our business that will drive a values-based culture.
Thank you, Keith. Are there any more questions? Gentleman in the center, number 3.
It's just a general question. Regarding the rise in populism and the disparity in wealth in the world, how do you see globalization in 10 years' time?
Yeah, it's a really good question. Let me give you one of my little bêtes noires. I think there are three challenges in this world that are existential, that our industry has to face up to, society has to face up to, that cannot be met other than by people coming together. One is climate change. One is the inequality that you mentioned, which leads to failed states, which leads to social disasters and possibly even terrorism. Then there's population growth, where we expect another 2 billion people over the next 25 or so years. All three of these, climate change, economic disparity, failed states, and population growth, could potentially lead to migration in a pattern that this world has never seen before. As countries suffer floods or droughts, people move.
As economic activity fails in states, people move for economic. If we can't cope with 2 million migrants attempting to come to Europe, how will we cope in 2050 when there's 2 and a bit billion more people in the world, predominantly in South Asia and Africa? The solution to that is to building sustainable ecosystems of economic activity through infrastructure development across the world, particularly in the countries that are most in need of them. Which, in some levels, are the developing world. In other parts of the world, it's upgrading the infrastructure that we have here, which is not perfect. It's certainly not perfect because its carbon footprint is not what it should be. There's a huge amount the world has to do together. I absolutely agree with you.
If we don't make those steps to invest in our future and those of our children, grandchildren, the world in 30 years' time will be a pretty sad legacy that people will look at us and say, "What were you doing?" This company, this industry, has a big role to play through its ESG activities, through its investments in infrastructure, through its holding companies to account on their own social responsibilities to help to contribute to the building of that world. It's a very good question, and we have a role to play. But only a role among many, many others. Thank you. Is there any more? Okay. Thank you for your questions. We'll now move on to voting on our resolutions. There are 14 resolutions today. Numbers one to nine and 12 are proposed as ordinary resolutions.
Numbers 10, 11, 13, and 14 are proposed as special resolutions. Full details of all the resolutions with the wording on which you will vote were published in the AGM guide. When voting is finished, we will have the results independently checked, verified by a scrutineer, who'll be busy at work behind the scenes to validate the voting. Once the results are validated by our Company Secretary, they'll tell me, and we'll conclude. Let's get started. The voting system we're going to use at today's meeting is, I hope, quite straightforward, but I'll take a few moments to explain how it works. We're going to use an electronic polling system which you may be familiar with. If you're eligible to vote today, you will have been given a voting handset like the picture on the screens.
If you could take your voting handsets now and check that your name is accurately displayed on the green screen. If it is, good news, it's all working properly. If you see a please insert smart card message, please check that the white ID card sticking out at the top of the handset is pushed in properly, or simply take the card out and reinsert it up to the red line printed on the card. If our stewards could just have a look around the room and see if anyone's having a problem, everything's okay with the handsets and help anyone that doesn't have one that seems to work. All okay? Okay. When I open the poll for each resolution, you will have three options, for, against, or to withhold your vote. To vote for a resolution, you press one on the keypad.
To vote against, you press two. To mark your vote as withheld, you press three. Withheld votes don't count in law and aren't included in the voting totals. When you have voted, you get a received message on the handset. You can, before the vote is closed, change your preference simply by pressing one, two, or three again on the keypad. It will update your vote. If you want, for any reason, to cancel your vote, you press C on the keypad. I'll let you know when I'm about to close the voting so that if you haven't made your selection, you can go ahead and make it. We'll have a little test to see that everything's working properly. We're going to have a practice vote.
If you could make your selection for, against, or withholding your vote based on the following statement that is on the screen, which says, "Corporate sustainability should be a central part of how businesses operate." If you could vote to test the system, 1 for, 2 against, or 3 to withhold. You can change your selection if you get it wrong or you want to change your mind by just pressing the button you want to press. I will close the practice vote, and hopefully the results on the screen will be encouraging. I thought it might be more than that, but good. It works. Let's move on to the real thing. Resolution 1 is to receive and consider the accounts for the year to 31st of December 2018, together with the reports of the directors and of the auditors on those accounts.
Can I take the documents as read, please? Thank you. Voting is now open. Press 1 to vote for the resolution, 2 to vote against, 3 to withhold your vote. I will give you a few more seconds. We will now close voting on Resolution 1. Thank you. Voting is closed. Second Resolution is to declare a final dividend of GBP 0.143 per ordinary share in respect of the year to 31st December 2018. Please vote now. 1 for, 2 against, 3 to withhold. A few more seconds, and we will now close the vote. In a few seconds, we will have behind us the voting results for Resolutions 1 and 2 up on the screen. Thank you. Resolution 3 is to reappoint KPMG LLP as the company's auditors until the conclusion of our next AGM. If you could vote now, please, on this resolution.
Couple more seconds, and we will close the voting now. Resolution 4 is to authorize the Audit Committee of the company to set the fees of the auditors for the year to 31st December 2019. Could you please cast your votes now on Resolution 4? I will give you a few more moments. We will now close the voting. Can we see the results of Resolutions 3 and 4 up on the screen now, please? Thank you. Resolution 5 is to approve the directors' remuneration report for the year to 31st December 2018, which was included in our 2018 annual report, and this excludes the directors' remuneration policy. Could I take the report as read, please? Thank you. I would like to say just a few words before we open the voting. We are expecting a relatively high vote against this resolution today.
Prior to today's meeting, we were made aware that many of our institutional shareholders did not support one element of the remuneration arrangements that were put in place to attract Stephanie Bruce, our incoming CFO, to the business. In particular, there was concern about a significant share award upon appointment, which would vest over a number of years. Part of the concern was a lack of performance conditions attaching to the award, and we listened to this feedback and we put conditions in place. However, many shareholders have still voted against this resolution. We want to clarify to you that this award is permitted within our remuneration policy.
The reason we made this award was to allow us to attract a very talented senior executive from outside the regulated financial services industry, who was historically remunerated on a comparatively consistent annual reward package without the significant deferral arrangements that we apply and apply generally in regulated financial services industries. If we'd hired a finance director from another regulated financial services business, we would have expected to buy out that individual from any long-term performance-based incentives that had been deferred, a practice that is typically supported by shareholders. Recruiting from outside the industry has allowed us to improve diversity on the board. We of course welcome further dialogue on how we address this challenge of bringing diversity into our industry. In order to keep the business of today's meeting moving, I will now open the voting on resolution 5. If you could vote now, please.
We will have a few moments more. Thank you. Voting is now closed. We will see the result of resolution 5 up on the screen now. Thank you. We will now move on to resolution 6 and 7, which cover the re-elections and elections of our board members. I will ask the directors to stand as I mention their name. We start with resolution 6A, the re-election of John Devine. Can you vote now, please? One for, two against, or three to withhold your vote. I will give you a few more moments. Voting is closed. Resolution 6B is for the re-election of Melanie Gee to the board. Could you please vote now? A few moments to finish. We will close the voting now. Resolution 6C is to re-elect Martin Gilbert. If you could vote now for Martin's re-election. A few more seconds. We will close the voting now.
Resolution 6D is for the re-election of Rod Paris. If you could please vote now. A few more seconds, we will close the vote for that one. Resolution 6E is to re-elect Martin Pike. If you could vote now, please. A few moments more. Thank you. The voting is closed for 6E. Resolution 6F is to re-elect Bill Rattray for a term until his retirement on the 31st of May. If you could vote now, please. A few moments more. Thank you. Voting is closed for 6F. Resolution 6G is to re-elect Jutta af Rosenborg. If you could vote now, please. Give you a few more moments. Thank you. The voting is closed for 6G. Resolution 6H is to re-elect Keith Skeoch. If you could vote now, please. A few more moments. Thank you. The voting is now closed for 6H.
In a few moments, we will see the results for all parts of resolution 6. Thank you very much. Let's move on to resolution 7 on board elections, not re-elections. The first election is for myself as Chairman. Because it wouldn't be right for me to ask you to vote for me, I am going to ask Simon Troughton in his capacity as the Senior Independent Director to talk you through this resolution. Simon.
Thank you, Douglas. Good afternoon, ladies and gentlemen. In asking you to vote on Sir Douglas' election, I am, as senior independent director, pleased to report that Douglas has demonstrated commitment to our business and to doing the right thing on behalf of our shareholders, customers, and clients. He has met the performance standards required of him by the U.K. Corporate Governance Code, against which your board will continue to carry out a formal evaluation of his performance each year. Can you please take your handsets and vote on Resolution 7A, the election of Sir Douglas Flint. It is one to vote for, two to vote against, or to mark your vote as withheld, press three. Let's have a few more seconds. I'll close the vote now, and the results should appear in a moment or two. Excellent. Thank you very much.
There it is. Thank you, Simon, and thank all of you. The next resolution is Resolution 7B, which is for the election of Cathleen Raffaeli. Again, please vote one to vote for, two against, or three to withhold your vote. A few more seconds. Voting is now closed. Thank you. Resolution 7C is for the election of Stephanie Bruce with effect from the 1st of June. If you could please vote now. I'll give you a few more moments, and then we'll close the voting on Stephanie's election. Thank you. In a few moments, we will see the results for 7B and C. Thank you very much. We'll now move on to Resolution 8. This allows for limited authority for the company and its subsidiaries to make political donations and to incur political expenditure.
We propose this resolution solely to give us flexibility around a matter where the current law is very broadly written indeed. We are strictly an apolitical business. It is not our policy to make any political donations. However, if there was ever a situation where we quite unintentionally breached the law, it could have serious consequences for the company. We ask you to vote on this resolution purely as a precautionary measure. With that in mind, could you please vote on Resolution 8. A few more moments and we'll close the voting. Resolution 9 is to authorize the directors of the company to issue further shares as a way to help manage our share capital effectively. If you could vote now on Resolution 9. I'll give a few more moments, and we'll close the voting now. Resolution 10 is to disapply share pre-emption rights.
This gives the board flexibility in the way that shares can be offered for sale. If you could vote now on Resolution 10. A few more moments, and we'll close the vote. Resolution 11 gives authority for the company to buy back up to a maximum of 10% of its issued ordinary shares. It's similar to Resolution 9 in that it gives the board flexibility to manage our share capital effectively. If you could vote now, please. A few more moments, and we'll close the voting now. In a few moments, we'll see the results for Resolutions 8 to 11. Thank you very much. Resolution 12 is to authorize the directors to allot shares in relation to the issuance of convertible bonds.
By allowing the board to allot shares or convert securities into ordinary shares, again, it helps us manage the company's regulatory capital requirements and meet our targets appropriately. If you could vote now, please. A few more moments, and we'll close the voting. Resolution 13 is to disapply pre-emption rights in respect of allotments of equity securities in relation to the issue of convertible bonds. If you could vote now, please. I'll give you a few more moments, and we'll close the voting now. The final resolution today, number 14, is to allow the company to call a general meeting by giving 14 clear days' notice. This doesn't apply to an annual general meeting, but does apply, if needed, to any other type of general meeting. If I could ask you for the last time to vote now, please.
Give you a few more seconds, and we will close the voting. If we could see the results for Resolutions 12 to 14, please. Okay, thank you very much. There we are. The scrutineer will now verify these results, which will only take a few moments. It's like the X Factor. All done? All done. The independent scrutineer has verified all of today's results. Resolutions 1 to 9 and 12 have been passed as ordinary resolutions, and numbers 10, 11, 13, and 14 have been passed as special resolutions. You'll find all the voting results, the detail on the website, that's standardlifeaberdeen.com, later on today. Finally, on behalf of the board, I'd like to thank you all for coming along today, for participating in the meeting, and for voting. On behalf of the board, we'd like to invite you to join us downstairs for some refreshments.
On the way out, if you could please remember to return the voting handsets, that would be great. Thank you very much. I formally close the business of today's AGM and wish you all a very good afternoon and hope to see as many of you as possible downstairs. Thank you very much.