York-based house building giant Persimmon is under heavy pressure from some of its major shareholders to oust its CEO Jeff Fairburn unless he agrees to give up most of a highly controversial £110 million pay package, according to a report in The Sunday Telegraph.
The newspaper said the shareholders have warned the company that the record-breaking payout is “unsustainable.”
One big shareholder told The Sunday Telegraph that it would want to see Fairburn give up at least 90% of his pay in order to keep his job, “and even that would be very generous.”
“At the end of the day, it’s simply far too much money for putting up a few timber-framed houses”, the investor said.
In December, Persimmon said its chairman Nicholas Wrigley would resign and remuneration committee chair Jonathan Davie had resigned amid the row over excessive executive pay at the firm.
Shareholders expressed concern about Persimmon’s long-term incentive plan introduced in 2012, which could see the firm’s management share up to £500 million depending on profit and housebuilding targets — with CEO Jeff Fairburn in line for the biggest potential payout of more than £100 million.
Fairburn defended the plan in January.
“This was a scheme that was launched at a time where the business was looking to move forward, there were stretching targets,” he told Reuters.
“Nobody has yet exercised any of those share options.
“From my own perspective, I have not made a decision and I’ll continue to review that.”