Good afternoon, everyone, and welcome to Aviva's 2021 Annual General Meeting. I'm George Culmer, and I'm pleased to be speaking to you at my first AGM as your chair. While I'm new to the role, I'm not new to Aviva. I've known this business for a long time, first as a competitor and then more recently as part of the board. I joined Aviva and then took on the role of chair because I'm determined to help make Aviva the success that our customers, our people, and our shareholders deserve it to be, one that is true to its purpose of being with you today for tomorrow. Now, joining me here in St Helen's is CEO Amanda Blanc, your CFO Jason Windsor, and Kirsty Cooper, our company secretary.
With us via video link are your board, and I'd especially like to welcome Mohit Joshi, Jim McConville, and Pippa Lambert, who are new to the board this year and who bring with them a wealth of valuable and relevant experience. I'd also like to wish Pippa a happy birthday. Now, our AGM is an important moment. It lets us update you on the company's progress, and more importantly, it gives us a chance to hear directly from you. And while we can't, due obviously to COVID restrictions, all be in the room, we have this year invited shareholders to not only attend but also, for the first time, take part in the meeting electronically. This means you will be able to vote online and ask questions.
Now, I can confirm that in line with our Articles of Association, we have the necessary quorum of shareholders in the room and joining virtually. The notice of meeting was made available to shareholders in March and set out the resolutions being put to the meeting today. I do not intend to read out each resolution, however, I will cover these within the formal part of the meeting later on. In order to give you time to place your votes online, I now declare voting open on all resolutions on the Lumi site for any shareholder, proxy, or corporate representative who is entitled to vote. Voting will remain open for the duration of the meeting. In terms of technology, the voting icon should appear on your navigation bar. From here, you will find that resolutions are set out in the notice of meeting and the voting choices displayed.
Simply select the option that corresponds with how you wish to vote. Once you have selected your choice, the option will change color, and a confirmation message will appear to indicate your vote has been cast and received. There is no submit button. If you make a mistake or wish to change your vote, simply select the correct choice. If you wish to cancel your vote, select the cancel button. You can also submit your questions using the online meeting platform. If you wish to ask a question, please click on the message icon located in the navigation bar at the top of your screen. Type your message into the ask a question box and click the arrow button to the right-hand side of the message box. I hope that's all clearer to you than it is to me.
If any person attending the meeting online is having any difficulties, there is a user guide that you can access through the platform on the information tab that should address any questions you might have. So now, without further ado, we can get underway. In terms of backdrop and for reasons of which you will all be acutely aware, 2020 was clearly a traumatic year with significant impacts and consequences that will no doubt play out for months and years to come. What matters for Aviva is how we have responded and how we continue to respond to these events and how we ensure that we are there for our customers and there for our communities.
Whether that was offering things like enhanced cover for NHS staff and deferred payments for customers in financial difficulty or contributing £43 million to support health services and community partners around the world, it is my strong belief that Aviva has been there. Now, since my appointment this time last year, we've welcomed Amanda Blanc as our new CEO, and we have a new strategy and new clarity in where we are heading as a business. We have focused Aviva on our three core markets of the UK, Canada, and Ireland, where we have scale and long-term competitive advantages. As part of that, we aim to become the UK's leading insurer and the go-to customer brand. Amanda will surely set out more detail on what's been delivered so far. What I would say is that we have already done much and that we have moved at pace.
I also, though, have no doubt that Amanda will rightly say that there's still much more to do. What I have noticed is that as I talk to our people, it feels like the organization has a spring in its step. Okay, I'm biased, but I feel there is a growing confidence and pride in what we do and, importantly, what we're capable of doing in the future. Before handing over to Amanda, I'd just like to touch on two matters. The first is the dividend. As you know, the enormous uncertainty around the economic impact of COVID led us to announce the withdrawal of the 2019 final dividend, an action that was aligned with the guidance from our regulators. I'm acutely aware of the importance of the dividend, especially for our individual shareholders, and this was not a decision that we took lightly.
I'm also, therefore, pleased that we were able to confirm a second interim dividend for 2019 of 6p in August and for 2020 an interim dividend of 7p and a final dividend of 14, giving 21p per share for the year. Looking ahead, our continued financial strength and our ability to deliver a sustainable ordinary dividend is a key element of our strategy, and Amanda will speak more on that in a moment. The second matter I'd like to mention is our determination as a business to act in a responsible, sustainable way. As I wrote in this year's annual report, if the pandemic has taught us anything, it is that we are ever more closely connected in this world. Companies cannot create value without looking beyond shareholder interest to see the benefits or harms that they contribute to society.
That is why this year we have unveiled a new ambition on sustainability. Our aim is to lead by example on climate change, to do our part to build stronger communities, and to run ourselves as a sustainable business. As part of that ambition, we have set a goal to become a carbon net zero company by 2040, and we are also committed to seeking an advisory vote from this meeting on our climate-related financial reporting, which is covered under Resolution 4. We are the first major insurer to do this, and it underlines the importance we place on transparency and accountability when it comes to taking action on the climate crisis. Sustainability is not just some nice-to-have. It is a fundamental strategic issue for us all and central to our long-term success.
Finally, I'd like to close by paying tribute to all my colleagues in Aviva who have been working so hard over the last 12 months. The challenges we have all faced have been exceptional, and their response has been even more so. I'd like to thank everyone for their remarkable and continuing efforts, and I'm frankly both in awe and humbled at what they have achieved. Thank you all so very much. I will now hand over to Amanda.
Thank you very much, George, and hello, everyone. I'm delighted to have this chance to speak to you all this afternoon. It's only been 10 months since I joined the business, but as I'm sure you know, a lot has gone on in that time, and I want to be as clear as I can with you about what we have done, what we are doing, and how we intend to take Aviva forward. Because this is as much your business as it is anyone else's, and the backing of our shareholders and your belief in what we are doing is going to be vital to our success. I am acutely aware that Aviva has underwhelmed many of our shareholders for some time now, and I am very conscious of the expectations you have.
I intend to meet those expectations and build a business that satisfies everyone: our customers, our people, and of course, all of you. Now, being there for our customers when it matters, being with them today for a better tomorrow, is the whole reason that we exist, and I'm incredibly proud of how our people have stepped up and lived up to that purpose in the last 12 months. Despite all the difficulties, the stress, the uncertainty, having to juggle personal and work lives from home, our people have consistently gone way above and beyond, and they have continued to provide an excellent service to our customers just when they needed us most. I want to take this moment to recognize that and to once again thank all my colleagues for what they've achieved in the most challenging of circumstances.
It really is inspiring, and it fills me with optimism that the best is yet to come. Last year, when I became CEO, I set out three strategic priorities for the business, three areas we needed to deliver on. They were: focus the portfolio, concentrating on our core markets where we have the scale and capability to win, financial strength, ensuring we have the strong foundations from which to build and grow this business, and transforming performance so that we can unlock our enormous potential and grow this business sustainably over the long term. Moving at pace is a bit of a mantra for me, and I'm pleased to report we are making excellent progress on all fronts. We said we'd focus on our strongest businesses in the U.K., Ireland, and Canada and manage our international businesses for long-term shareholder value, and that is exactly what we have done.
In just eight months, we've announced the sale of eight businesses: France, Singapore, Italy, Hong Kong, Indonesia, Vietnam, Turkey, and Poland. That strengthened our capital and our liquidity, and that's really realizing significant value for you, our shareholders. We said we'd ensure we're financially strong, and that is exactly what we are. We have a healthy capital surplus of GBP 13 billion. Our cover ratio stands at over 200%, and we have over GBP 4 billion of central liquidity. We have accelerated debt reduction plans, and we will have redeemed GBP 1.9 billion of debt by early June. As we complete on our disposals in the months ahead, our priorities for deploying excess capital continue to be reducing our debt, investing to grow our core businesses, and returning substantial capital to you, our shareholders.
Speaking of which, and turning to that all-important question of your dividend, in November, we set out our intent to deliver sustainable ordinary dividend. In line with the new shape of the group, that dividend will be covered by capital generation, cash remittances, and growth from our core businesses, and we intend to increase that dividend per share by low to mid-single digits over time as we grow the business, improve efficiency, and reduce debt. Our third strategic focus is to transform performance in our core business. We've made a good start and can report some decent early progress. Despite the challenges we all faced in 2020, our financial and trading performance was robust.
We even had some record trading results in key growth areas: 8% year-on-year commercial lines growth, £6 billion of bulk purchase annuity new business sales, representing a record for Aviva, £8.5 billion of savings and retirement net inflows, and we are ahead of our plans to deliver £300 million of cost savings by the end of 2022, with £180 million already achieved. So we're on our way, but I want us to do more and move faster to create a real shift in the way we operate to serve our customers. Because those customers are why we exist, all 18 million of them across the UK, Ireland, and Canada. Everything depends on our customers and how we serve them. That's where success comes from. That's where the growth comes from.
We need to build our business around each one of them, serving their needs seamlessly and efficiently, regardless of whether they are a business, an individual, or an intermediary. And we want to serve more of those needs for more of our customers. So we've articulated a big vision. We want to lead in all our markets: Canada, Ireland, and of course, the UK. In Ireland, where we have a strong market position, we're going to broaden our appetite in general insurance to bring more of what we do to more mid- to large organizations, safely expand into new specialty risks, and make better use of digital to simplify customer experience.
In our Irish life business , we are investing in our distribution teams, automating more and more of our processes, and ensuring stronger collaboration with the wider business so our customers in Ireland can benefit from more of the products and services Aviva has to offer. In Canada, where we have a strong foundation as a top three player, we will secure the growth we need by providing all of our customers with a greater consistency of experience, being easier to do business with, and providing them with an unmatched claims experience. We are very fortunate to have two strong businesses in Ireland and Canada, businesses that have a genuine claim to be leading in their local markets. But to give them the best chance of fulfilling that ambition, we have to have a leading position here, our home market in the U.K.
We've said we're going to be the UK's leading insurer and the go-to customer brand in the country for all of our customers' insurance, protection, savings, and retirement needs for individuals, corporates, and their respective intermediaries. Not just in one area, but all of them. Not just good, but the best. Here in the UK, in our home market, we have the unique position of being able to serve people across the whole of their lives. We are the only insurer who can be there from buying their first car through to starting a family and the responsibilities that come with that, to saving for their future and making sure they have a comfortable income when they retire. We're already number one in general insurance and workplace pensions. We're number two in protection and health and a top three player across annuities and equity release.
There's opportunities for growth in all of them. For example, one in four people in the U.K. are forecast to be over 65 by 2039, presenting a massive opportunity for our individual savings and retirement business. If we look at the bulk purchase annuity market, current forecasts estimate GBP 30 billion-GBP 50 billion of flows per annum over the next decade. That's a tremendous opportunity for us to sustain the record volumes we have delivered in 2020 and to go further. In commercial lines, we are witnessing one of the hardest-rate markets in living memory. We have achieved good growth in 2020, but we can do more. We will be better at serving our customers, making it easier to do business with us by simplifying, automating, and digitizing the business. We'll be better at engaging with customers and being clear about how we can support them.
You'll have seen we've launched a new brand campaign for the first time in years, helping our customers understand better who we really are, why we exist, and how we can be there for them throughout their lives. We'll be better at presenting ourselves to our customers in a coherent and a consistent way, whatever they need, however they come to us. We've revamped our values and performance management to build a unified culture where everyone thinks, behaves, and acts as one business, completely and relentlessly focused on serving those customer needs. I'm beginning to sound like a broken record, but I make no apology for that. Because, like I said, those customers are why we're here. It's pretty simple. If we can satisfy those customer demands and needs, everything else will flow from that.
What they want and expect is not all that complicated when you boil it down. They want fair prices, a trusted brand that delivers on its promises, and of course, excellent service. They want all this from a company that will act in a sustainable and responsible way. We've been a recognized leader in so-called ESG issues, environment, social, and governance for many years, but this year we've said we have to do more. As the UK's leading insurer, we have a responsibility to lead the way in the face of the climate emergency. We are the first major insurer or bank in the UK to target carbon net zero by 2040. As George said, this is a key strategic issue for us as a company, as it should be for all companies. We cannot function if our society, economy, and ultimately the planet cannot function.
We're not doing this just because it's the right thing to do. We're also doing it because it makes sound commercial sense. Our plan covers the carbon emissions we produce ourselves. It covers emissions contributed by our suppliers, and it covers, as far as possible, the investments we make for our customers and our shareholders. Meeting these commitments will be hard, but we cannot wait for everything to be neatly laid out before we move the organization in the right direction. In this, just as in everything else, pace matters. It has been a busy few months, like I said. We've done a lot, and in a few moments, you'll see a short video picking out just some of this year's highlights. But I'm under no illusions. We are not done yet, not by a long way. I know you're expecting more. You're right to expect more. I expect more.
I know you're going to be looking at us to produce sustained, tangible improvements in our financial performance. I know this, and I'm convinced we have the right people, the right motivation, and the necessary will to do just that. I know we've got what it takes. Thank you all for your continued support, and thank you for listening. Today, we're building a better Aviva to serve people better, seeing customers, not policyholders, solving problems, not selling products. It takes a partner to map the path to a brighter future and help you start putting one foot in front of the other. A partner to our customers, a team with our colleagues, a sustainable investor in our society. We protect people each day. We help people to get on with their lives. We support them when they've had a problem. We did the virtual pride activities, and that was amazing.
Based on one of the funds that we've just launched called the Sustainable Income and Growth Fund, I think Aviva's purpose came to life in 2020. Probably the most challenging target that we have ever set ourselves, and we are bringing it upon ourselves. But I firmly believe that Aviva has a clear responsibility to act. We've got the power to make a real difference. Those four values absolutely, to me, describe what it's like to work for Aviva. I think the care value is one that probably really is close to my heart because it links us back to the customer, and it's all about the customer. That's why we're here. Our Aviva family are naturally caring towards one another, and we want to give back not just in a professional sense, but from a community perspective.
I think the commitment value is kind of bringing us back to our purpose. That customer confidence in us comes from our brand reputation, the fact that we're continually innovating. Okay, thank you very much, Amanda. Moving now to your questions. Your board are here both in the room and by video link to answer any questions you may have on the business of the meeting. In the interest of time, we will collate questions of a similar nature into batches and will answer them all together. We hope to get through all the questions within the next hour. If there are any still outstanding at that stage, we will make sure they are answered in writing and posted on our website.
As this is a shareholder meeting, we will not be taking customer questions or other customer matters, and we will refer your question to the right colleague who will be in touch shortly following the meeting. We've asked a colleague in the room to read out the questions as they are submitted. So, Andrew, it's over to you. The first two questions are from Mr. David Hobson. I noticed divestment of investments in fossil fuel use industries. Surely your first priority should be to gain the highest return on investment for your shareholder and seek best value. Okay. Thank you, Mr. Hobson, for your questions. Look, as I've said in the annual report and accounts and in my presentations, I do strongly believe that companies cannot create value without looking beyond shareholder interests to see the benefits or harms they contribute to society.
I firmly believe this is in the best interests, the best long-term interests of businesses, shareholders, customers, communities. And we firmly believe that we can and we will generate strong and sustainable returns and do the right thing for the environment. It's not a question of choosing. And to us, this clearly represents best value for everyone. With 20% fewer claims on motor insurance and homes in lockdown with heating on, resulting in fewer burst pipes and fires due to constant vigilance, surely there should have been greater scope to increase the dividend further, making up for previous shortfalls. Okay, and so it's a good question. Look, again, as you heard from Amanda and as you've seen from yourself, in 2020, Aviva delivered robust results and a strong financial position. As you stated, Ms. Hobson, yes, there were benefits from changes in circumstances caused by COVID.
There were also COVID-related additional charges and costs. Regarding the dividend, though, as I said earlier, we fully recognize the importance of the cash given to all shareholders, and particularly ordinary shareholders, individual shareholders. What matters, though, is that that dividend is resilient and sustainable. People know what they're getting, and they know what they expect to get. I believe our new dividend policy, which is explicitly linked to the cash flow, capital generation, and growth of our core businesses in the UK, Canada, and Ireland, is precisely that. As you've heard, going forward, we intend to grow dividend per share by low to mid-single digits as we benefit from growth in our core businesses. We benefit from improved efficiency, and we benefit from lower levels of debt costs.
I would also emphasize that Aviva is financially strong and, following the completion of the major disposals, will be in a position to make a substantial return of capital to our shareholders. The next question is from Ms. Alison Downes. I live in Suffolk, close to the site of the proposed new twin nuclear power station Sizewell C, and was pleased to see Aviva's response, as reported in the Sunday Telegraph, that the ESG impact of nuclear is far from clear at this time, and we are not actively involved in any such investments. The ESG case for Sizewell C continues to weaken. It cannot help the U.K. reach its new target of a 78% reduction in CO2 emissions by 2035, since it is not projected to be operating before 2034, and such projects are notorious for delays.
Additionally, EDF admits it would take six years to offset 6.2 million tons of CO2 emitted during construction. The proposed RAB financing model for Sizewell C could contribute to fuel poverty, with consumers required to pay a nuclear tariff during construction years before any electricity is generated. In light of the above, can you please confirm that Aviva will not invest in Sizewell C? Okay. Thank you, Ms. Downes, for your question. I mean, this is clearly an important topic, and I think one that will only become ever more so. As you say, and as the article stated, the U.K. government is looking at expanding nuclear capacity, and this is a core part of its efforts to achieve net zero emissions by 2050. Currently, we believe, or we consider the potential ESG impact in all of our investment decisions.
However, as reported, we believe the ESG impact of nuclear is, at this time, still far from clear. To answer your question, I can therefore confirm that we are not currently actively involved in any such investments. I would also say, though, that we do think a debate is needed on this topic, and we fully intend to be involved in that debate. The next two questions are from Mr. John Harvey-Meacock. In carrying out their role, does the Customer Conduct and Reputation Committee occasionally, at random, read customer complaints and consider also the contents of the reviews appearing on the two Aviva Trustpilot sites, 79% and 65% classed as bad, when contrasted with more favorable reviews for, say, Admiral, 25% bad, and LV, 3% bad, on Trustpilot? Okay. All right. Thank you, Mr. Meacock, for your, well, two questions. Let's answer the first one.
Look, as you heard from Amanda, our strategy and our success depends on putting our customers at the heart of everything that we do. Now, of course, we're not going to get everything right first time, and it's important that when we fall short, that we fix it quickly and also that we look into the reasons why things went wrong so we can make sure it doesn't happen again. The Customer Conduct and Reputation Committee, to which you refer, that's a committee of the board. It's chaired by Jim McConville, and its main purpose is to set the standards and policies for the group, to provide oversight of our conduct in relation to customers, and to ensure good customer outcomes are being delivered.
I regularly review customer complaints and will correspond with and reply to, and the Customer Conduct and Reputation Committee regularly looks at areas of customer concern and how these can be swiftly resolved. Amanda attends and executives attend those sessions, and this will continue to be a massively important area of our work. As regards to Trustpilot, yeah, now this is an interesting one. This is a way of getting feedback which is invaluable. What it is very fair to say, though, that the start had technical issues of the system actually collecting a balance of scores. That has now been corrected, and what I'm delighted to say is that at the beginning of this week, our score was something like 4.4, which puts us ahead of those competitors that you spoke about. And I'd like to say I think this is where we should be.
The nation's physical and mental health has been badly affected by COVID-19 issues. So will the board consider, if not done already, instructing health and life underwriters to take a pragmatic view in underwriting future risks presented unless this is forbidden by reinsurance treaties? In asking this question, I am particularly concerned that certain members of our population may be penalized unfairly in view of the use of the words "cohorts of the population as highest risk of COVID-19" in comments about individual life insurance risks as per page 39 of the annual report. Okay. Again, thank you, Mr. Meacock. You obviously know a bit about the industry. Look, I should start by saying that the board and management share your concern that the company takes the appropriate, the right, the pragmatic approach with its customers and potential customers with regards to all matters COVID-19.
I like to think that over the last year or so, Aviva has done precisely that. Regarding your specific question, I mean, as you imply, underwriting lives is about assessing risks, and obviously, COVID-19 is a new risk and one that continues to evolve with both the emergence of new variants and obviously the success of the widespread vaccinations. Nevertheless, it's our strong desire, working with our reinsurers, as you point out, to revert as soon as possible to our pre-COVID-19 underwriting appetite. And what I would say is, in the meantime, we are adopting a pragmatic approach, and I think that view is shared, I believe, by our regulators. These aren't just fine words. Real-life examples of this would be things like proactively postponing tests, which would otherwise be declined, and proactively working with customers to secure cover.
I am pleased to say that our acceptance rate for life insurance remains well above the 90% level. The next question is from Mr. Philip Meadowcroft. The 2020 annual report contained evidence we have repeatedly seen over the past two decades or so that Aviva Investors makes a negligible 3% contribution to group operating profit in 2020, GBP 85 million out of a group total of GBP 3,161 million. The report states that 80% of the funds managed by Aviva Investors belong to Aviva, arising from managing Aviva Investment Funds of one form or another. Aviva Investors is simply unable to become a significant asset management company because it attracts too little non-Aviva business, as well as delivering non-stellar investment performance in many Aviva categories like unit trusts. Has the Aviva board ever undertaken a granular review of Aviva Investors and the validity of the ROI it delivers?
If the board has, there has clearly not been a strong and positive reaction, and if it hasn't, isn't that a serious dereliction of responsibility? Put simply, when will Aviva Investors become a substantial contributor to group operating profit? Or would it be better to employ our CEO's disposal skills to offload parts of our Aviva Investors business, which lack scale and significant contribution to group business? Okay. Thank you, Mr. Meadowcroft, for your question. Thank you for joining the meeting. Those are strong words. Let me say a few words upfront, and then I'll just ask Amanda to give more detail. First of all, I think, as is very clear with the strategy we've set and the action we have taken, the board and management took a very long, hard look at the group, and that very much included Aviva Investors.
We concluded, and we all very much believe that Aviva Investors has a critical role in the future of this group and brings key skills and key attributes as we move forward and seek to grow and develop Aviva for the benefit of our customers and our shareholders. To your points, is its performance currently where we'd like it to be? No. But we have taken action, and we will continue to take action. With that, I'll ask Amanda just to give a bit of detail in terms of things. Thanks, George, and thank you for the question, Mr. Meadowcroft. So look, I've been very clear that while Aviva Investors is a key part of the group, we also have an expectation that its performance has to improve.
Mark Versey, the new CEO of Aviva Investors, and I are completely focused on taking the necessary steps to drive improvement across this business. As George said, of course, the board has taken time to review all of our businesses and concluded that Aviva Investors has the potential to grow, particularly as it focuses on its key strengths in real assets, private debt, infrastructure, equities, and credit capabilities, which it excels and which are rooted in its insurance heritage. I think, furthermore, Aviva Investors has significant strategic value to the group as a whole. It plays a key role in delivering investment capabilities that are critical to supporting our growth strategy. It's a key enabler of our bulk purchase annuity strategy, originating high-quality, high-yielding, and capital-efficient assets that we can use to back our annuity liabilities, and that gives us an important competitive edge compared to some of our peers.
In our savings and retirement business, its design and management of ESG default funds, as well as the low-cost multi-asset solutions, has helped us to secure our position as the U.K.'s leading workplace pension provider. Aviva Investors' decades-long track record at the forefront of sustainable investing means that it is ideally placed to meet the growing demand from clients and customers in this area, as well as helping Aviva to reach its net zero emission by 2040, a goal that we announced earlier this year as the first major insurer anywhere to do so. So all this means that we would expect Aviva Investors to become a bigger contributor to the profits of the group. Dear Chair, my name is Michael Kind, and I'm asking a question on behalf of ShareAction. My question is in relation to Aviva's use of annual general meeting attendance in its stewardship practices.
COVID-19 has led to much debate about the future of the AGM. A recent ShareAction paper argued that investors should embrace the value of attending AGMs now and in the future. AGMs are a brilliant opportunity for investors to enhance their understanding of investee companies' approaches to ESG. Investors are given the opportunity to hear from and interact with a wider range of voices, including the entire company board, as well as retail and institutional investors. Key company stakeholders may also be present. This opportunity to listen to and exchange views has clear value in comparison to other engagement opportunities. Moreover, it is a brilliant opportunity for investors to demonstrate to end beneficiaries that they are serious about stewardship.
For example, earlier in the year, BMO Asset Management attended the Compass AGM to understand what the company had put in place to prevent a repeat of the food parcels scandal. Do Aviva plan to make use of Investee Companies' AGMs in your stewardship practices this AGM season and in the future? Okay. Thank you for your question, Mr. Kind. And the short answer is yes. We believe we know ShareAction does important work in this area, and I'd like to think you would agree with me that Aviva has also been a leading voice in shareholder activism for many a year. Aviva and Aviva Investors are committed to being responsible stewards of our clients' money, and that means using our influence to press companies to embrace more sustainable practices, to hold boards, management teams accountable where they fall short.
And to do this, we make use of every tool available to us. That's private meetings with management, filing shareholder resolutions, and of course, as you say, voting at company AGMs. And I think we cast our votes at something like more than 6,000 AGMs and EGMs every year. Mostly, obviously, this is done electronically, but by exception, we will also attend where we feel our presence and contribution will add value to that meeting. So yes, I'm in agreement with your question. Yeah. My name is Stuart Laidler, and I'm asking a question today on behalf of ShareAction, a responsible investment charity. We are facing an unprecedented collapse of life on Earth. The 2019 Intergovernmental Science Policy Platform on Biodiversity and Ecosystem Services, or IPBES, report raised serious warnings about the unsustainable decline of both animal and plant species on our planet, with one quarter facing threatened survival.
Last year, for the first time, the World Economic Forum placed all five of its top global risks in the category of natural environment, while also warning that $44 trillion, over half of the world's GDP, is dependent on nature and the services it provides. As allocators of capital and stewards of companies, the financial sector has a critical role in helping mitigate biodiversity loss and helping sustain a habitable planet. Yet while investors are starting to make progress on other global systemic issues like climate change, our own research of the world's asset management community finds only extraordinarily little progress, if at all, on this critical issue. However, we see progress is possible. BNP Paribas Asset Management, for example, has committed to no deforestation, no peat, and no exploitation targets across its portfolio holdings by 2030. Meanwhile, BlackRock are considering biodiversity as a factor in routine voting items.
We ask for Aviva to lead by example by committing to take the following steps: one, to develop and publish an investment and engagement policy on biodiversity to cover all assets under management, beginning with policies targeting high-risk sectors and outlining clear expectations for companies. The policy should include prioritization of the topic of biodiversity within its company engagement program and be supported by a robust escalation policy. Two, to join the Finance for Biodiversity Pledge with the ambition to set science-based nature targets by 2024 at the latest and to support key collaborative initiatives such as the Taskforce on Nature-related Financial Disclosures. In the meantime, ShareAction is willing to meet with representatives from Aviva to discuss this in further detail. Okay. Look, thank you for your question, Mr. Laidler.
We clearly recognize that nature is critical for our society, our economy, and our businesses to thrive, and that urgent action is needed from us all to protect our ecosystems. And I'll ask Amanda, if it's all right, to just comment on some of the specific actions that we are taking. Okay. Yes. Thanks, George. So look, Aviva has a long history of engagement on biodiversity topics such as deforestation, world heritage sites, and more recently, plastics. I can actually confirm that we are currently drawing together a biodiversity policy, and we will be looking to work with stakeholders before publishing it. As a sign of our intent in this area, I can also confirm that we have already signed up to the Terra Carta Initiative, and we're currently signing up to the Finance for Biodiversity Pledge.
Climate change is inextricably linked to biodiversity loss, so we cannot solve either problem in isolation. We recognize that. So we think that there's a lot to learn about how the finance sector can tackle biodiversity loss from our approach to climate change. And so we will also be looking at initiatives like the Taskforce on Nature-related Financial Disclosures using our own experience of TCFD. The next question is from Mr. Adam McGibbon. Our company is a shareholder and bondholder in Adani Ports and Special Economic Zone, a company which last month was removed from the Dow Jones Sustainability Index and has been linked to both a massive thermal coal mining expansion in Australia and the Myanmar military. The company in Myanmar it is in business with is under UK government sanctions.
Recently, close to a dozen investors have publicly divested or restricted investment in this destructive company, including PIMCO, State Street, and Nordea. Is our company comfortable being invested in a company such as Adani Ports? Will it reconsider this investment? Commentary from Aviva Chief Investment Officer David Cumming in an article titled Stranded, published on the Aviva website in February, discussed two options facing fossil fuel companies. Firstly, a managed decline where CapEx is restricted to only those projects that fit within a set carbon budget and excess capital is returned to shareholders, or secondly, using free cash flow to diversify into alternative low-carbon businesses. Reporting in the Financial Times in January also stated that Aviva will divest from fossil fuel companies that fail to appropriately address climate change over the next 1-3 years.
Is it fair to conclude that Aviva will divest from fossil fuel companies that fail to articulate a clear, detailed, Paris-aligned plan to manage down fossil fuel production in the very near future? Also, given the historical rarity of successful business transformations, how wary is Aviva of fossil fuel companies' diversification claims? Our company, through Aviva Investors Global Services Limited, is listed as one of the shareholders of Adaro Energy, a major Indonesian coal company with 87% of its revenue from coal mining, with 1.1 billion tons of coal reserves. If all this coal is burned, as Adaro intended it to be, it will release 2.2 billion tons of greenhouse gases into the atmosphere, nearly equivalent to the annual emissions of India.
Adaro Energy does not have any credible plans to demonstrate how it will phase out coal and diversify its business in a manner consistent with the Paris Climate Agreement. Given our company's well-established commitment to sustainability, will Aviva review the impact of Adaro Energy's coal business on climate change and consider not investing in Adaro Energy in the future? Okay. Thank you for that, Mr. McGibbon. And obviously, there were some important topics in there. There were also a number of questions. I think you're asking both our stance on fossil fuel companies in general and their compliance with Paris Climate Agreement and also specific questions on Adani and Adaro. Look, on fossil fuel companies, we announced in January that we will make specific requests of 30 systemically important carbon emitters and have a timeline between 12 and 36 months to evidence action.
If we fail to see evidence of serious engagement, we will put them on our stop list and divest of any assets held. Within the next year, we'll also divest of companies making more than 5% of their revenue from thermal coal, again, unless they're signed up to science-based targets. On the specific companies you mentioned, I can confirm that we have already taken action to reduce our active holdings. And as it stands today, we hold something like less than 0.01% of each of their shares and a very, very low level of their debt. So action has been taken. That was a good call. The next question is from Mr. Peter Miller. Will the board agree to suspend the sale of the Gomm Valley development site until a full review has been carried out of Aviva's prior commitments to the community, setting against fiduciary duties and ESG aspirations?
Okay. Look, thank you for that and for your question on the sale of our interest in Gomm Valley real estate development. Now, this is located just outside High Wycombe in Buckinghamshire and is garnering quite a lot of interest at the moment. Let me just set out the background and where we are on this. Aviva took over management of the site in 2016 as part of the Friends Life acquisition. Over the past five years, we've worked with a number of parties on the potential development of the site. In the middle of last year, we reviewed the project and instructed a third party to explore a valuation. Subsequently, we determined that the fund which owns the site is no longer in a position to support a potential development.
A conclusion reached in acting in the best interest of our customers and this fund who are saving for their retirement through this particular fund. We subsequently received a number of offers, and alongside price, we considered elements including the certainty of the transaction completing. Additionally, we were clear in our minds that we would only sanction a sale to a responsible and reputable new owner. It is also worth noting, of course, that any plans a new owner may have for the development of this site would still be subject to all the usual local authority planning processes and full public scrutiny. There is no current planning permission approved for this site.
Now, I understand not everyone will agree with or like some of the decisions we make, but they are made in good faith and after careful and thorough consideration of all factors, including the interests of our customers and the saving for their retirement. Regarding, I hear your question, but I should say we have no plans to suspend the sale process. The next question is from Mr. Cliff Weight. If the Remuneration Committee had known of the public censure of Aviva by the FCA in 2020 when they decided the bonus awards for 2018, would they have applied more than a 5% reduction? The Aviva Remuneration Committee on Malus and Clawback, page 100 of the annual report, says that Clawback can apply for a scenario or event which causes material reputational damage to the company.
Is Aviva saying that a public censure by the FCA is not material reputational damage? My third and fourth questions relate to the fifth bullet on page 100: any regulatory investigation or breach of laws, rules, or code of conduct. The FCA censure clearly falls under this category, in my opinion. So why did Aviva not use this policy to clawback the 2018 bonuses, and why did Allen & Overy think this was not a reasonable basis? Please, can you explain and publish the reasons why Allen & Overy gave Aviva this advice? Okay. Thank you for that question. Obviously, on a topic where there's very much public interest. Look, as shareholders are aware, this question relates to the company's announcement regarding its preference shares, which was made, I think, in March 2018.
Now, the company has already taken significant action, including publicly apologizing for the issue, making whole those who had suffered losses, and reducing executive directors' bonuses, not by 5%, but by 17.5%. Now, at the 2019 AGM, as some might recall, we also committed to review the remuneration action taken for the whole board once the FCA investigation had been finalized, which occurred in October 2020. Following the FCA's decision, I therefore initiated an independent review of the decisions around remuneration in relation to the board and this issue. Now, this involved establishing a subcommittee of the board, which I chaired, and which comprised board members who were not involved in the original issue, not at the company at the time. We, as the subcommittee, in turn, commissioned an independent law firm, A&O, as you say, who were, again, not previously involved with the original decision.
Now, that review by A&O concluded that the action taken, as you say, on the executive directors at the time was appropriate and that there was no basis for further action in relation to the non-executive directors. The subcommittee, as I said, which chaired by myself, accepted the conclusions of that review. The next question comes from a shareholder who has requested not to be named. Given the very large cash surplus that presently exists and which will further increase from the sale proceeds of recently agreed disposals, can the board now give the meeting a clear idea of their intentions for the capital that is deemed to be in excess of current requirements? Okay. Thank you for your question. And obviously, you've heard Amanda speak about this a few moments ago. And obviously, last November, Amanda and Jason outlined a new and clear capital framework.
Under this framework, we will reduce leverage. That's borrowing. That's debt below 30%. We will invest in those core businesses which we're determined to grow. We will return capital in excess of the 180% Solvency II cover ratio and return that capital, obviously, to shareholders. We've been clear that we are fully expecting, as we've said, to make a substantial return of capital to our shareholders. Now, in terms of progress, as we announced our results in March, we're taking an important first step by paying back debt and reducing the leverage, reducing the borrowing. That includes, again, as you've heard, GBP 1.9 billion of debt being repaid in the first half of this year, which will lower leverage by taking us to about 27%. Now, this will utilize a significant position of our current excess cash.
We currently expect to receive the cash from our disposals of France, Poland, Italy, which in aggregate, I think, is around something like GBP 5 billion in Q4 and Q1 of 2022. But I would say, again, that we are fully expecting to make that a substantial return to our shareholders. The next three questions come from Mr. Sunil Kumar Pal. Firstly, can you please put debt and dividend in the contents of the annual report? Okay. Well, thank you for that. I think I'll have this as a question I had CFO written over it. I think it's this one. Jason, would you just kind of respond to that? Sure. Thank you. We do have in the contents something called capital management, which does include lots of information on the capital of the organization, including lots of detail on the debt.
The dividend is covered in detail on page one and in the chairman's report very upfront. But thank you for the question. We're just waiting for the next question, which is, "Sir, what do you mean by narrow shareholder interest in your statement? Why should our interest in investing to get a return be considered narrow?" I don't think it is narrow. And I don't recognize the term. I don't doubt that I'm sure you've been through it and that I said it. But if I said it, it isn't narrow. As shareholders, you own the company. You participate on all aspects. You're involved in all aspects. All aspects of the business are relevant to you. So I don't recognize or remember using the word narrow. I assume I did.
What I can assure you, though, is that I won't be doing so again as we move forward because I don't think, to your question, they are narrow interests. This question is to the Chief Executive. Madam, if it is not confidential, can you please highlight why do you think past board could not realize the significant untapped potential of Aviva which you have seen? Okay. Thank you for that question. Look, it is really not for me to comment on what's gone before. What I always like to comment about is where I want to take the business. What I'm interested in is looking to the future.
But if you want me to comment on why I believe there is such potential, it is because today we're focused on our attention on the core markets, U.K., Ireland, and Canada, where we've got leading positions and where I believe that we have the potential to win. And I think that strategy is very clear. It's centered on customers, as I've spoken about earlier, and serving their needs throughout their lifetime. We also are building the strategy around digital. I mean, that's the way that the world works now. It's a fundamental part of our business, as has been demonstrated by the success during 2020. And we will continue to invest in this area.
So we're focused on delivering robust growth, and we're allocating our capital, our resources, our investments to these targeted areas where we believe there will be clear market growth opportunities and where we have leading positions. Of course, there is also a new management team in place. I'm really confident that these are the right ingredients for Aviva to really fulfill its true potential. The next question is from Mr. Richard Peter Parkins. The annual report mentioned several times a correction in the interpretation of a regulatory rule in the French subsidiary. Breaking regulatory rules is a serious matter. Could the board provide an explanation of what rule was broken and how, what the effect was on the numbers in the financial reports, and whether there is likely to be any penalty against Aviva? Okay. I'll start that and then ask Jason to comment as well. Mr.
Parkins, I agree entirely in terms of the seriousness of not complying or breaking, as you say, regulatory rules. It is our responsibility as a board. It's our responsibility as management to run this group in accordance with the rules and regulations that pertain in all the territories within which we operate. And it was hugely disappointing to find ourselves contravening some of the local requirements in France. In terms of the specifics, I'll just ask Jason to comment on some of the things that happened within France. Thank you, George. The rule that we referred to was the way that policies would have been credited in very negative interest rates. We never actually reached those very negative interest rates, and it was picked up as part of our review. And as a consequence, there was no impact on customer policies, and there was no impact on profit.
There was an impact on our capital position, which we've disclosed in the annual report. That impact was 2 percentage points on the group solvency ratio, which, as George mentioned, was over 200% at the end of the year, and also £250 million on operating capital generation. The board has overseen a thorough review of the model, both the PLC and the French board. We have made the French and the UK regulators fully aware of the matter, which we've now resolved. The next question is from Mr. Philip Adrian Clark. Our new CEO is correct when she says shareholders are underwhelmed by Aviva's performance over recent years. This is well captured by the TSR graph on page 114, which shows Aviva lagging a very long way behind the comparator group. Now we have new management.
Can you tell us what you perceive the reasons for historic poor performance and how quickly Aviva's performance will be above the comparator group median line on the TSR graph? Okay. Look, I'll take that in the sense of, as Amanda said earlier to a previous question, I don't think there's anything to be gained by looking in detail in terms of what did or didn't happen in the past. I think what matters is where we are now and where we are taking this company. As you've heard today, as you've read in the report, we have a new strategy. We are moving at pace, and we are taking decisive action within the business so that we focus on those areas, as I said, where we think we have long-term competitive advantages and where we believe we can outperform.
I'm not going to give any quantification of where we think that performance might take us. But I think, as I said in my presentation, my goal, Amanda's goal, is to take Aviva to where it deserves to be. And that's not just for its customers, colleagues. It's most obviously for its shareholders. And the performance has not been as positive as it should be. It's certainly my aspiration, I think, it's Amanda's aspiration that going forward, you are going to see a positive performance of the company that hopefully will be reflected in that share price. The next question is from Mr. Anthony Lee. Under the latest chief executive, Aviva is divesting itself of most of its foreign subsidiaries. This increasingly limits its operations to the UK.
Doesn't this place a disproportionate amount of risk on the future of the UK, especially in the post-Brexit period and in the new era of COVID? By selling off those assets, Aviva may be getting cash now, but the temporary boost to shareholders is at the cost of compromising future revenue and growth. I think that, look, it's a good question. It's a thoughtful question. I would say this, wouldn't I, but I fundamentally believe that what we're doing is the right thing in terms of focusing on those markets, on those entities where we have the biggest strengths, where we know the markets best, and we think we are most able to capitalize and realize the potential of this business. Yes, as you say, I switch from some sort of diversification and some sort of global exposures down to an exposure on the UK.
I am personally more optimistic about the UK than you might imply within your question. I would also say that we have serious and we have sizable businesses within Canada and Ireland. But I think first and foremost, as managers of this business, it's imperative that we focus on those that we think are going to be the long-term winners. And the positions that we had overseas didn't have the strength, didn't have the attributes that we have in the UK. And I entirely think that it's still the right thing to focus on those businesses where we think we can win and we think we can succeed in the long term. And as I said, I am actually more optimistic about the UK than your question might imply. This is another question from Mr. Anthony Lee.
When Aviva sold its French business for EUR 3.2 billion, it agreed to a specific indemnity concerning known price arbitrage contracts over and above existing provisions. Previous managements have downplayed the threat from these contracts. Although Aviva may believe the risk is minimal, the fact that it had to provide this indemnity to the purchaser surely shows that the risk is real. What is Aviva's liability? Thank you for the question, Mr. Lee. Look, I don't think we as a management team have downplayed or talking correctly about this. I think we've spent a lot of time understanding these contracts, understanding these risks. In any form of transaction, you're going to get indemnities. You're going to get warranties. And the one we've got fully shares that risk between ourselves and the purchaser, Aéma Groupe. The size of that indemnity is one that has no material impact upon our capital position.
It's one where the provisions that we carry have been agreed, have been signed off by things like the French regulator, ACPR. So I don't think there's been any misleading or deliberate downplaying. I think we have a good assessment of those risks and the mitigants that surround those risks. And I said the indemnity, the warranty that we cover shares those risks. And in terms of capital, we'll have to put behind that the amounts really are not material. So coming out of France, we had a good deal. It was a right deal for the business. We have a good counterparty who understand that market, who understand that business. It will be the right deal for our colleagues, right deal for our customers. And again, I think fundamentally it is the right deal for Aviva in terms of focusing back down on the UK.
We now come to the final question, which is from Ms. Elsa Alberta McPherson. I have been experiencing problems obtaining notice of the AGM and voting documents by post since the 29th of March, but these have not been received, although requested on several occasions. As a result, I have not been able to vote. Can the board confirm that this process is speeded up in the future? Thank you. Okay. Mr. McPherson, obviously, massive apologies for the difficulties that you have had. Sincere apologies if you have been unable to vote. I will ask Kirsty to basically just say a few words in terms of what we can do to perhaps improve processes as we move forward. Thank you, Ms. McPherson.
As you know, the notice of meeting was published on the 25th of March and sent to shareholders who had requested hard copy documentation on or about that date. Your election, I know, was not to receive hard copy documents, but we can change your election if you wish. I apologize if you've tried to do this without success. We will absolutely follow up on your inquiry offline with our registrar, Computershare, following the meeting. In terms of process, we issue our annual general meeting documents at the earliest opportunity, and we will continue to do so. I would also add that you are now logged in to the meeting through the Lumi system, and so therefore you do have the ability to vote today. Okay. Thank you, Kirsty. Thank you, Andrew. Look, I believe that was our last question.
I just want to say thank you to everyone who took the time to submit questions today. For those of you who would have not had time to answer your question, we will post answers on our website. I now propose that we move to the formal part of today's agenda. I'd like to alert everyone that this is your last opportunity to vote on the resolutions if you have not already done so. The system will close in a few minutes' time. As I said, I will take the notice of meeting as read. However, I would like to draw your attention to the items of business. Firstly, Resolution One. The directors are proposing to receive and consider the annual report for the financial year ending 31 December 2020. Resolution Two is proposed to approve the directors' remuneration report.
This resolution is advisory only and is a means for shareholders to provide feedback to the board. Resolution 3 relates to the approval of a remuneration policy, which has been updated to ensure continued alignment with best practice and was last approved by the shareholders at the 2018 AGM. In relation to Resolution 4, as I previously mentioned, we are this year asking shareholders to approve our climate-related financial disclosure for the first time. In Resolution 5, the directors are recommending a final dividend for the year ending 31 December 2020 of £0.14 per share. The dividend is payable on the 14th of May to ordinary shareholders whose names are on the register of members at the close of business on the 9th of April. Resolutions 6 to 15 concern the re-election of all directors who retire in accordance with the company's articles.
In Resolutions 16 and 17, we are seeking approval for the reappointment and remuneration of our current auditor, PwC. A competitive tender process for the auditor had commenced during 2020. However, as a result of COVID-19 and following approval by the FRC, it was agreed to defer the tender by 2 years. Resolution 18 covers political donations. I know that shareholders have raised concerns in the past about the company seeking authority for this matter. I would like to be clear that it is not the company's policy to make political donations or incur political expenditure, and it has no intention of doing so. Resolution 19 refers to the authority conferred on the directors to allot shares. Resolutions 20, 21, 23, and 27 to 30 inclusive are being proposed as special resolutions.
Resolutions 20 and 21 relate to the disapplication of preemption rights and seek authority in line with the guidelines to give the board maximum flexibility in order to raise capital. However, the directors have no present intention of exercising this authority. In regard to Resolutions 22 and 23, shareholders will recall that in 2020, we requested shareholder approval for the company to issue Solvency II instruments to support the future capital management of the company should it be necessary. This authority expires at the end of this AGM, and the board is seeking renewed authority to allow the company to continue to have this flexibility. The board believes that it is prudent to have these authorities in place, although there is no present intention of exercising them. Resolutions 24, 25, and 26 relate to the approval of the renewal of certain updated Aviva share plans for the next 10 years.
Finally, Resolutions 27 to 29 relate to authority for the company to purchase its own shares. Resolution 30 relates to the authorization for the company to call general meetings on no less than 14 clear days' notice. Now, as a final reminder, if you have not placed your votes, please do so now. It only therefore remains for me to say those shareholders who could not attend today have been voting on the resolutions, and the final results of the voting will be announced to the London Stock Exchange and posted on the company's website as soon as possible. With that, thanks to all of you for taking part, and I will now formally conclude today's meeting. Thank you very much.