PRESS RELEASE 82 23/08/2016
ShareSoc (the UK Individual Shareholders Society) is advising its Members to vote against the Remuneration Report resolution at the forthcoming Annual General Meeting of Berkeley Group Holdings Plc. ShareSoc considers:
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Berkeley has performed well in recent years. Its share price was £8, when it introduced its LTIP in 2011, and was £24.90 when this note was written. But the 2011 LTIP plan total payout is likely to be more than £400 million and is considered excessive. The plan was approved by shareholders in 2011 and it may be considered too late to do anything about that decision, except to highlight that at the time this cyclical business was towards the bottom of the cycle. Shareholders who supported the plan should have examined it more carefully and should have seen the large potential dilution that will result.
Cliff Weight, ShareSoc spokesman on remuneration issues, said “I think the Berkeley Remuneration Report fails the ShareSoc Remuneration Guidelines test of Clarity and Transparency. Rather than giving a balanced report to shareholders, the report reads more like a marketing brochure emphasizing the positives and omitting the negatives. The key things the annual statement from the Chairman of the Rem Com fails to mention are firstly the size of the 2011 LTIP total payouts and potential payouts (of over £400 million) that will significantly reduce shareholders’ returns. In addition it fails to mention that Executive Chairman Tony Pidgley:
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Weight continued “This is yet another example of remuneration creep. ShareSoc is opposed to unnecessary increases in directors’ remuneration. Given his huge equity incentives, I am surprised Mr. Pidgley was given an increase in salary. I doubt this will motivate or help to retain him, so it could be considered as a waste of shareholders’ money and may attract unnecessary media attention.”
Another issue is the combination of Executive Chairman and Chief Executive. Most companies with an Executive Chairman do not have a CEO as well. If we look at the cost of employment of the combination of the two roles, it becomes apparent that the combination of Executive Chairman and a Chief Executive is unnecessary. In total, their salaries are £600,000 higher than a more normal combination of a non-
For further information, please contact:
Roger Lawson
Deputy Chairman, ShareSoc
Telephone: 020-
Or:
Cliff Weight, Director and Remuneration Spokesman, ShareSoc
Telehone: 01737-
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