November 2018 – Plant Special
As this issue of the magazine prepared to go to press, house-builder Persimmon announced that it was parting company with its erstwhile chief executive, Jeff Fairburn. Or rather, it was showing him the door.
Fairburn had become an embarrassment to the company, having found himself entitled to a bonus of more than £100m and delightedly grabbing it with both hands.
That Fairburn is a greedy man, there can be little doubt. Horrified shareholders tried their best to prise his fingers open and persuade him to give some of the loot to charity, which he eventually did. But he still trousered a cool £70m. And when asked about it by a BBC reporter, he walked out of the interview looking hurt and complaining that “I think that’s really unfortunate that you’ve done that”.
The UK Shareholders Association had warned about the lack of transparency surrounding Persimmon’s ‘long-term incentive plan’ years ago. But the shareholders themselves weren’t listening: the share price was soaring. And UK house-building is all about making money.
Fairburn and his fellow board directors are the biggest beneficiaries of the government’s Help to Buy scheme, which bolstered demand for new homes.
The intended beneficiaries might have been able to scrape enough together to buy a new home, but they’ll still be paying off the mortgage for the next 25 years. Meanwhile, for companies like Persimmon, the UK’s housing crisis is the gift that keeps on giving.