Persimmon management to bag £600m bonus

Helen Cahill
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UK's Biggest Housebuilder Postpones Start On New Homes As Sales Slump
The pay to Persimmon's management is under fire (Source: Getty)

Persimmon's executive pay plan has come under fire after it emerged management will share £600m over the next five years.

A top City investor has urged the housebuilder to reduce the payment, which represents one of the biggest at a FTSE 100 company, excluding banking.

Read more: There's little logic to 2016's shareholder revolts against executive pay

Chief executive Jeff Fairburn could earn over £100m, according to the BBC.

Mike Fox of Royal London Asset Management described the payments as too much "in all circumstances", and said the board should be more sensitive given the current housing crisis and the government's backing of the building industry.

Under the scheme, around 150 managers at the UK's biggest housebuilder were given the chance to earn shares worth up to 10 per cent of the company's value if they make targets on returning money to the company's investors.

A spokesperson for Persimmon said: "This is a long-term plan that runs for almost a decade, which is designed to drive outperformance through the housing cycle and to incentivise the management to deliver the capital return, grow the business and increase the share price.

"Unlike many other schemes, it extends to around 150 executives."

Read more: More pressure on Martin Sorrell over £70.4m pay package

This is one in a line of rebellions over pay packages so far this year. In April, shareholders voted against a £14m sum for Bob Dudley, boss of BP.

Earlier this month, investors were lining up to vote against WPP boss Martin Sorrell's £70m pay package. Sorrell walked away with the money, however, as the majority of investors did not have a problem with his remuneration.

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