One of the highest profile stories in recent years in the sector finally enters its final chapter. At the request of Persimmon and by mutual agreement Jeff Fairburn will leave Persimmon at the end of the year.
It appears Persimmon finally wanted to put an end to the huge bonus saga which has run for months and this was their choice of ending the “distraction”.
Purely from a financial performance perspective Fairburn’s record as CEO is nothing short of stellar. Under his stewardship, Persimmon doubled the number of homes it builds and more than doubled its market capitalisation. Its ROCE and margins are industry leading.
Ironically, it was this level of performance that led to his departure. Perhaps if the designers of the controversial LTIP scheme had foreseen the five-fold increase in the share price they may have attached a slightly more modest share allocation to the CEO position.
The headline initial headline figure of £100m+ payout to Fairburn was simply unacceptable to investors and a variety of politicians and commentators. Whilst Fairburn waived about a quarter of this and offered to make a sizeable donation to charity it became unsaveable from a PR point of view. For some observers, the recent awkward interview between Fairburn and the BBC appeared to be the final straw.