Persimmon chair resigns amid incentive plan dispute

Nicholas Wrigley

Nicholas Wrigley has announced his intention to resign as chairman of Persimmon following concerns over excessive executive pay at the housebuilder.

Remuneration committee chair, Jonathan Davie, has left also the group, with Wrigley remaining in his position while the Board seeks a successor.

It follows investor disquiet over a long term incentive plan introduced in 2012, which could see the management share £600 million depending on profit and housebuilding targets.

Believed to be the most generous ever in the UK, the bonus scheme is due to start paying out to senior staff on December 31. The payouts are linked to the company’s stock market performance, which has been massively boosted by the UK government’s Help to Buy scheme.

Chief executive Jeff Fairburn is in line for the biggest payout, which is set to top £100m.

Announcing Mr Wrigley and Mr Davie’s departures, Persimmon admitted that the generous pay out plan presided over by the duo “could have included a cap”.

Persimmon said: “The company introduced a Long Term Incentive Plan in 2012 (2012 LTIP).

“The board believes that the introduction of the 2012 LTIP has been a significant factor in the Company’s outstanding performance over this period, led by a strong and talented Executive team.

“Nevertheless, Nicholas and Jonathan recognise that the 2012 LTIP could have included a cap. In recognition of this omission, they have therefore tendered their resignations.”

But Persimmon added that since the award scheme was launched, the company has made “substantial cash returns to shareholders at the same time as increasing the size of the business and delivering significant value”.

It added that Persimmon has delivered an increase in the number of new homes supplied and invested £2.9 billion in new land.

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