Vistry shareholders revolt over executive pay

Vistry shareholders have come close to rejecting the firm’s executive pay proposals for a second time in three months.

At a specially-convened general meeting yesterday, the housebuilder’s shareholders narrowly approved a policy that will see chief executive Greg Fitzgerald’s overall pay package increase by up to £2.2m per year.

The firm said 45.2% of shareholders who took part rebelled against the company’s new remuneration policy, drawn up in the wake of Vistry’s £1.1bn takeover of partnerships housebuilder Countryside last year, with just 54.8% in favour.

A separate vote to approve a Long-Term Incentive Plan scheme at the £3bn turnover company was passed by just 55.3% to 44.7%. According to reports, proxy voting investment advisers ISS and Glass Lewis had both advised shareholders to vote against the proposed pay deals.

The remuneration package, set out in a letter to shareholders at the start of August, will see Fitzgerald’s basic salary by 5.9%, from £755,215 to £800,000, while his maximum annual bonus will increase to 300% of salary instead of 150%. The separate ‘long-term incentive plan’ bonus will increase from 200% to 300% from next year.

In total Fitzgerald’s total package limit increases from £3.4m to £5.6m a year. Justifying the proposals at the time, Paul Whetsell, chair of Vistry’s remuneration committee said Vistry is a “significantly larger and more complex business” than it was before its acquisition of Countryside in November 2022, and that Fitzgerald will need to hit “stretching” targets to receive the full package.

>>See also: Top 50 Housebuilders

In response to the revolt yesterday, Vistry said in a statement it was pleased that all resolutions have been approved by a majority of shareholders, but noted that a “significant number of shareholders” opposed the approval of the revised policy.

It added: “The Company remains committed to ongoing shareholder engagement and will continue to do so to ensure that the Company understands shareholders’ views and is able to consider feedback, as well as to provide clarity on the Company’s approach to remuneration going forward”.

The narrow passing of pay package follows an attempt earlier this year by some Vistry shareholders to push through a much bigger jump in executive pay. Two Vistry board members sitting on the remuneration committee resigned in March after proposals were put to the company for Fitzgerald to be granted a bonus package worth up to £60m.

Shareholders also revolted over last year’s remuneration policy, voted on in the May Annual General Meeting, when 47% of shareholders voted against the proposals. At the time the company said it would consult with shareholders over the course of the next few months “so that we can fully understand their concerns and decide on appropriate next steps.”

Vistry has set out plans to grow the firm’s output to 20,000 homes per year, which if achieved would make it the largest housebuilder by volume in the UK.