Scandal-hit York house building giant Persimmon has been urged to change its corporate culture by an independent review following serious complaints about its executive pay, customer service and the safety of its homes.
The board of Persimmon commissioned the independent review to assess the effectiveness of measures designed to improve the firm’s practices and behavior.
Persimmon lost nearly a third of its stock market value last year and appointed company insider Dave Jenkinson as chief executive officer permanently in February after former CEO Jeff Fairburn stepped down after a row over his $100 million package.
The independent review said Persimmon needs to improve the quality of its homes and review its executive bonuses. Persimmon shares fell about 4% after the report was published.
“Persimmon’s culture must change,” concluded the report, led by Stephanie Barwise of Atkin Chambers.
“In a changing regulatory environment, Persimmon cannot afford the stigma of a corporate culture which results in poor workmanship and a potentially unsafe product.”
On building safety, the Barwise review said the lack of cavity barriers in some Persimmon-built homes posed an “intolerable risk”.
Cavity barriers act like fire doors in open spaces in floors and walls, preventing rapid spread of fire.
“Although we understand the problem has, to date, only been identified in Persimmon’s timber-frame properties, we suggest that a fire engineer should be asked to consider the different Persimmon construction types,” the review said.
Persimmon chairman Roger Devlin said: “This review — and the seriousness that we attach to its detailed findings — is an important moment for Persimmon as we continue to build a different business with an increased focus on our customers and wider stakeholders — becoming a business that prioritises purpose as well as profit.”