Persimmon starts to address investor concerns on pay
Commenting ahead of Persimmon’s AGM, Ashley Hamilton Claxton, Corporate Governance Manager at Royal London Asset Management, said:
“As expressed last year, we have long standing concerns about pay at Persimmon. The company’s performance has been impressive, but we continue to believe that the sheer scale of remuneration available under Persimmon’s current LTIP is excessive. This could see an LTIP payout equivalent to 10% of the value of the company, with the CEO potentially receiving an award in excess of £100 million. We will be voting against this year’s remuneration report, against the Chair of the Remuneration Committee and against Nigel Mills: he sits on the Remuneration Committee, but we do not consider him independent because of his ties to one of the company’s brokers.
“The house building sector is one where companies can experience a significant uplift from factors outside of their control, such as interest rates and government policy. As such we question the value of pay plans that provide high windfall payouts to executives.”
“Despite these historic concerns, we are pleased that Persimmon has proposed a remuneration policy for the next three years that limits performance share awards to just twice the directors’ annual salaries. This will significantly reduce the maximum payouts available. With that in mind, we’ll be voting for the binding remuneration policy.”
Royal London Asset Management holds 1.41m shares in Persimmon, 0.46% of the company worth £32m
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About Royal London Asset Management (RLAM):
Established in 1988, Royal London Asset Management (RLAM) is one of the UK's leading fund management companies, providing investment management solutions to both wholesale and institutional clients such as not-for-profit organisations, local authorities and the insurance sector.
RLAM manages £100 billion of assets and employs 76 investment professionals. It invests in all major asset classes including UK and overseas equities, government bonds, investment grade and high yield corporate bonds, property and cash.