Backlash at builder over £21.5m pay
THE millionaire boss of Berkeley group faces a shareholder backlash over his bumper pay in the latest protests over boardroom excess.
Tony Pidgley, the former Barnardo’s boy who set up the luxury housebuilder in 1976, took home £21.5m last year and £23m the year before as his salary was topped up with bonuses and awards from a long-term incentive plan.
Under a separate scheme he could receive a further £100m in the coming years, prompting a group of investors to urge shareholders to vote against the package at the company’s annual meeting on september 6.
The Institution of Directors branded Pidgley’s pay ‘excessive’.
Cliff Weight, chief executive of sharesoc, which represents individual investors, said his remuneration was unnecessarily high. sharesoc said the payouts would be ‘an unnecessary transfer of wealth from shareholders to management’ and criticised the latest £25,000 rise in Pidgley’s basic pay to £875,000 a year.
‘given his huge equity incentives, I am surprised Pidgley was given an increase in salary,’ said Weight. ‘I doubt this will motivate or help retain him, so it could be considered as a waste of shareholders’ money and may attract unnecessary media attention.’
But a spokesman for Berkeley said 94pc of shareholders had voted in favour of its latest longterm incentive plan resolution – in 2011 – and added: ‘Major shareholder bodies have been consistently supportive of the company’s approach to remuneration.’
It is the latest in a series of outcries against the remuneration packages of FTsE bosses, whose pay has sky-rocketed over recent years, angering shareholders.
In April, 60pc of BP shareholders voted against boss Bob Dudley’s £14m pay deal, and WPP chief executive sir Martin sorrell’s proposed £70m pot sparked a shareholder revolt at the firm’s annual meeting in June. Prime Minister Theresa May has promised to overhaul corporate governance to try and close the wealth gap that sees bosses being paid more than 140 times what their staff receive.
Pidgley, who was adopted by travellers from Barnardo’s at the age of four, has led Berkeley group to its position as one of the UK’s most successful housebuilders. He left school at 15 to form his own haulage company, which he sold at the age of 20 before forming Berkeley group seven years later and floating it on the stock market in 1985.
Revenue for the year ending April 30 was £2bn, in a year which saw 3,776 new homes sold across London and the south of England for an average of £515,000 each. Much of Pidgley’s pay stems from long-term incentive plans, agreed when the company’s share price was about £8 in 2009. It closed at 2649p last night, up 3.9pc or 99p on the day. Now Pidgley – who is worth £270m according to the sunday Times Rich List – holds £172m of shares in the company.
stefan stern, director of the High Pay Centre, said: ‘There’s something systematically wrong when that sort of reward is available even in the context of the market. Are companies like this succeeding at the same time that millions of people are being kept out of the housing market altogether and others are paying excessive rents? It doesn’t look or feel right.’
oliver Parry, head of corporate governance at the Institute of Directors, said: ‘The vast majority of people would say “this is excessive and we need to
address this”.’