Redrow faces revolt after lowering bar for bosses’ bonuses

HOUSEBUILDING giant Redrow is braced for an investor revolt this week after making it easier for bosses to earn bonuses.

Investor advisory groups have told shareholders to vote against the firm’s long-term bonus scheme at its annual general meeting in the City on Wednesday morning.

Glass Lewis has taken issue with Redrow for lowering earnings targets that executives must hit to achieve bonus payments. The company said it had lowered objectives for its executives because of changes to the Government’s Help To Buy scheme – which will now only be available to first-time buyers – and ‘macroeconomic uncertainty’. ISS also recommended a vote against executive pay at Redrow because of historic long-term bonus conditions set for Steve Morgan, who stood down as chairman of the firm in March.

Both advisory groups also said stock owners should vote against John Tutte, the former chief executive who has now replaced

Morgan as chairman. They say that because Tutte – who was paid £1.9 million last year – was previously chief executive of Redrow, he is not sufficiently ‘independent’ to oversee governance of the firm.

A Redrow spokesman said: ‘We are aware of, and take seriously, the issues raised. We have actively engaged with our shareholders and continue to be in dialogue with them.’

Housebuilding executive bonuses have been hugely controversial in recent years.

Boosted by the Government’s Help To Buy scheme, Redrow’s rival Persimmon paid its former chief executive Jeff Fairburn around £75 million in bonuses in two years.