Housebuilder Redrow suffered a shareholder revolt at its annual general meeting today as around a third of investors voted against the appointment of its executive chairman and payment plans for senior management.
At the meeting in central London today, 31.38 per cent of shareholders voted against the re-appointment of John Tutte as executive chairman, while 30.39 protested the directors’ remuneration report.
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Both motions were approved after receiving enough support from shareholders overall.
Prior to the meeting shareholder advisory firm Pirc recommended shareholders oppose Tutte’s re-election, saying “holding an executive position is incompatible” with the independence requirements of the chairman role.
Redrow said at the time of Tutte’s appointment it “recognised that it was not considered best practice to appoint a chief executive to the role of executive chairman”
However, it added in a statement today that “the circumstances necessitated continuity” after industry veteran and Redrow founder Steve Morgan stepped down from the role and Tutte’s appointment was “in the best interests of the company”.
“The board will keep the current arrangements under review and will continue to discuss them with shareholders,” the company said.
Redrow said the votes against plans for executive pay were connected to the long term incentive plan (LTIP) award for 2020, and the LTIP payment made to Steve Morgan following his transition to a non-executive from an executive role in October 2017.
LTIP’s have been criticised by investors as they allow bosses to receive that are not tied to the company’s share price.
Morgan was awarded LTIP payments to “reflect his length of service” up to his leaving date in March this year, Redrow said.
“The board will review future LTIP targets, measures and rules as part of the forthcoming review of the company’s remuneration policy that will be subject to shareholder approval in 2020 and…. the board will continue its dialogue with shareholders in relation to these matters,” the company added.
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