Berkeley shareholders push back on pay

Berkeley Group faced a significant push-back from shareholders against a new remuneration policy at today’s annual general meeting. Almost 40% of votes cast at the meeting were against approving the directors’ remuneration policy. Roughly 29% were against rules for the company’s restricted share plan and about 39% against a long-term option plan. In response, Berkeley said the new remuneration policy was designed to “[align] with the unique operating model and inherent long-term focus of the business” and said the remuneration committee had carried out “a detailed and extensive consultation with shareholders” and received “positive feedback and support”. Ahead of the AGM, remuneration chair Andy Kemp wrote to shareholders explaining the new remuneration policy as necessary given the company’s “unique operating model [as] the only large UK homebuilder focused on the regeneration of complex large-scale brownfield projects”. “Each of its sites takes many years to design, plan and deliver,” Kemp said. “Continuity of senior management and maintaining long-term trusted relationships is fundamental to maximising value in an environment characterised by the complexity and individual nature of each site’s operational challenges, the regulatory environment, and the differing requirements of individual stakeholders and boroughs.” Kemp added that “a traditional remuneration structure is not appropriate for the company”. The restricted share plan includes annual share awards of 175% of salary for the chief executive and 150% of salary for other directors. The long-term option plan, meanwhile, includes a one-off grant in September 2022 of 1m options to the chief executive and 350,000 to other executive directors. The company added after the AGM: “The remuneration committee recognises that developing a new remuneration approach that meets the needs of all shareholders is difficult, but is of the view that the new remuneration policy, which includes introduction of ESG priorities into the incentive framework, normalisation of pension contributions and increased shareholding requirements represents further alignment with shareholders.” To send feedback, e-mail tim.burke@eg.co.uk or tweet @_tim_burke or @EGPropertyNews Photo by Bernard Jaubert/imageBROKER/REX/Shutterstock