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Standard Life must learn lessons from mutuality battle

The numbers from the Standard Life vote leave no room for complacency. The

company won easily but only within the narrow terms of the contest, with

carpetbaggers needing 75 per cent of the vote.

But in reality and to maintain any credibility, Standard&#39s board had to

win an overall majority. It did so but only by the narrowest of margins.

Before the campaign, Messrs Bell et al were regarded as some of the

smartest brains in the insurance market but, with mutuality a central part

of its business model, the board must ask itself what went wrong to

convince 46.6 per cent to votefor plc status.

Of course, many members will always vote this way, trading long-term

benefits for short-term gains. Others simply need the money to fit their

own individual circumstances. But others may be genuinely concerned about

how the business is run.

Standard is understood to be investigating how it can tighten the rules so

it does not have to fight a constant war of attrition with carpetbaggers.

It is right to do so if not just to prevent further waste of members&#39

money, as defence of its mutual status cost the company more than

£10m. It must also look at how it treats its members, how it shares

its assets and how it communicates with its customers.

IFAs have a significant role to play in ensuring Standard becomes more

responsive. If it addresses these concerns, the board will re-establish its

reputation and the reputation of the company.

If it succeeds, Standard should easily win any future vote, hopefully

silencing critics for good.


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