Persimmon Homes -- CEO £100m Bonus...
Discussion
Biggest bonus for a listed company in UK history.
Free-market economics, or corporate looting.
Discuss.
https://www.theguardian.com/business/2017/dec/15/p...
Free-market economics, or corporate looting.
Discuss.
https://www.theguardian.com/business/2017/dec/15/p...
That is an unusually big bonus lets be honest
I'm all for market economies but persimmon are NOT living in market economy
Help 2 Buy has just allowed them to make 20% more margin on every house they sell- and that's a massive amount of money.
You would have hoped they would hvae spent that £100m building more homes!
I suspect if the house building market was properly competitive than persimmon culdn't have afforded to pay this.....
I'm all for market economies but persimmon are NOT living in market economy
Help 2 Buy has just allowed them to make 20% more margin on every house they sell- and that's a massive amount of money.
You would have hoped they would hvae spent that £100m building more homes!
I suspect if the house building market was properly competitive than persimmon culdn't have afforded to pay this.....
The bigger picture is a total of £600million being handed out to 150 employees, with £100million of that being taken by the CEO.
And it isn't about CEO pay- shareholders have made money and would have been happy for him to be rewarded.
It was that this was cozy club approved a potentially unlimited payout, and then got caught out as they didn't expect such massive government subsidies (50% of sales were due to Help2Buy).
By making the top 150 execs rich, it means these employees can pretty much quit working now. There should have been a cap to account for the unexpected, basic common sense.
When it became apparent what was going to happen, the chairman refused to act retrospectively.
f
kwit chairman was forced out this week (won't care, also works for Rothschild) along with the fkwit 'independent' director who was chairman of the remuneration committee. Rest of the renumeration committee, CEO and others involved should all go.
powerstroke said:
Good for him successful company building houses for people who think they're successful, oh and think how many people working there have good well paid jobs... win win !!!
You don't get it, they have let down the shareholders...And it isn't about CEO pay- shareholders have made money and would have been happy for him to be rewarded.
It was that this was cozy club approved a potentially unlimited payout, and then got caught out as they didn't expect such massive government subsidies (50% of sales were due to Help2Buy).
By making the top 150 execs rich, it means these employees can pretty much quit working now. There should have been a cap to account for the unexpected, basic common sense.
When it became apparent what was going to happen, the chairman refused to act retrospectively.
f
kwit chairman was forced out this week (won't care, also works for Rothschild) along with the fkwit 'independent' director who was chairman of the remuneration committee. Rest of the renumeration committee, CEO and others involved should all go.Persimmons said:
Persimmon said Wrigley and Davie recognise the plan “could have included a cap”. It added: “In recognition of this omission, they have tendered their resignations.”
Edited by hyphen on Saturday 16th December 00:27
The TrustPilot reviews for Persimmon are interesting. Company scores 1 out of 10...
https://uk.trustpilot.com/review/www.persimmonhome...
https://uk.trustpilot.com/review/www.persimmonhome...
Pigs at the trough. It's not like he personally built all those houses, so it would have been far better shareholder value to invest that money in existing and new staff training - how many apprenticeships could they deliver with 600m to address the shortfall in skilled workers to meet the needs of future housebuilding targets or retaining and training existing staff to improve product quality?
Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
nyxster said:
Pigs at the trough. It's not like he personally built all those houses, so it would have been far better shareholder value to invest that money in existing and new staff training - how many apprenticeships could they deliver with 600m to address the shortfall in skilled workers to meet the needs of future housebuilding targets or retaining and training existing staff to improve product quality?
Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
You don’t think tax is paid on bonuses?Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
sidicks said:
You don’t think tax is paid on bonuses?
The bonus pool was paid in stock not cash. It'll have been structured through options and convertible stock agreements to shift from paye into capital gains and allow deferral so the beneficiary can avoid crystalising the gain until they dor unstance retire to a low tax jurasdiction. The tax only becomes due when the benefit is paid. By example they could give him a class of stock which is valued at 10m with a convertible provision to exchange for market tradeable stock on a 1 for 10 basis, this reducing his current liability to 10 percent of the notional exercisable value and allow a lock in so he's motivated to see the share price rise further before he exercises his conversion clause.With 600m in the pool there is no way tax accountants would design a bonus scheme that oed to paye liability as that would trigger NI costs for the company amd reduce the value of the bonus to the employee. The whole design of stock bonuses is to mitigate paye on cash bonuses and defer it into lower rate CGT that can be avoided by moving to a CGT free jurasdiction before crystalising the gain.
HMRC have a running battle with company stock schemes but the tax accountants always find a hew way to structure them to mitigate tax.
According to Citywire, Persimmon's performance in 2016 was:
The bonus pool is equivalent to the entire profits made in 2016, which seems excessive. Furthermore, Jeff Fairburn (the CEO) has been with in charge since 2013, though he's spent his entire career with them, so it's not as though he built it from scratch. It looks like the senior management are raiding the company to reward themselves, rather than its owners.
- Turnover: £3.1 billion
- Profit (before tax): £775 million
- Profit (after tax): £625 million
The bonus pool is equivalent to the entire profits made in 2016, which seems excessive. Furthermore, Jeff Fairburn (the CEO) has been with in charge since 2013, though he's spent his entire career with them, so it's not as though he built it from scratch. It looks like the senior management are raiding the company to reward themselves, rather than its owners.
PugwasHDJ80 said:
That is an unusually big bonus lets be honest
I'm all for market economies but persimmon are NOT living in market economy
Help 2 Buy has just allowed them to make 20% more margin on every house they sell- and that's a massive amount of money.
You would have hoped they would hvae spent that £100m building more homes!
I suspect if the house building market was properly competitive than persimmon culdn't have afforded to pay this.....
Is the correct answer.I'm all for market economies but persimmon are NOT living in market economy
Help 2 Buy has just allowed them to make 20% more margin on every house they sell- and that's a massive amount of money.
You would have hoped they would hvae spent that £100m building more homes!
I suspect if the house building market was properly competitive than persimmon culdn't have afforded to pay this.....
The Persimmon SP has more than doubled since Help To Sell was introduced in 2013
sidicks said:
nyxster said:
Pigs at the trough. It's not like he personally built all those houses, so it would have been far better shareholder value to invest that money in existing and new staff training - how many apprenticeships could they deliver with 600m to address the shortfall in skilled workers to meet the needs of future housebuilding targets or retaining and training existing staff to improve product quality?
Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
You don’t think tax is paid on bonuses?Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
Eric Mc said:
sidicks said:
nyxster said:
Pigs at the trough. It's not like he personally built all those houses, so it would have been far better shareholder value to invest that money in existing and new staff training - how many apprenticeships could they deliver with 600m to address the shortfall in skilled workers to meet the needs of future housebuilding targets or retaining and training existing staff to improve product quality?
Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
You don’t think tax is paid on bonuses?Should have been capped at 6 - 10x salary maximum. It doesn't take a corporate genius to sell products in a captive market where price and supply have been artificially constrained by planning laws, and virtually no competitive pricing pressure exists between a cartel of big suppliers.
It doesn't benefit the company, and it doesn't benefit the economy because very little of that 600m will be spent in the real economy but is likely to get squirreled into trust structures vs the boost to the real economy paying out decent bonuses to all employees suffering 10 years of negative wage growth or creating training schemes to get the skills in place for future house building growth to solve the shortfall.
Fair play to him, I'd take 100m if someone gave it me, but its shoddy corporate governance and terrible PR given how political house prices and shortages are at the moment and a gidt to the trotskys after the housing builders bleated for so much taxpayer support like h2b only to trouser all the benefits.
Eric Mc said:
If the company had not paid the bonuses, the company's profit would be higher so their Corporation Tax bill would have been higher. I expect that the overall tax being paid by the company to HMRC will not go up or down because of the bonus.
Corp tax is a much lower rate than he's paying in income tax - 45% income tax versus 21% corp tax.Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff