Investment advisers urge shareholders to vote against pay deal at group's AGM and oppose election of Tony Pidgeley as chairman

Institutional investment advisers, Pensions Investment Research Consultants (PIRC) has said it has 鈥渨ide-ranging concerns鈥� about pay awards for senior Berkeley Group management which it calls 鈥渉ighly excessive鈥� and advises shareholders to vote against the deal at the firm鈥檚 AGM on Wednesday.

It also advised investors to oppose the election of former chief executive, Tony Pidgley, to the role of chairman. Best practice boardroom rules suggest that former chief executives should not be elected to chairman without justification to shareholders.

In an alert, PIRC pointed out that executive directors and key management were entitled to a total of 10% of the value of the company as long as the share price did not fall below last year鈥檚 levels before 2014. The maximum payout at the end of the period would be worth 拢22.8m, it said.  

The awards are uncapped relative to base salary and otherwise unrelated to performance, PIRC added, meaning that directors were 鈥渦naccountable鈥� to shareholders.

鈥淚n effect, shareholders face an overall 10% dilution in return for executives remaining in employment until 2014,鈥� said the adviser.

鈥淭his is of particular concern because performance targets act as s fundamental component of accountability for shareholders to determine the veracity of executive an corporate performance. A clear lack of transparency in this regard has the potential to fuel shareholders fear of reward for failure.鈥�

The package of measures was voted through in an extraordinary meeting this year but PIRC is advising shareholders to vote against them on Wednesday.

In the past year, former chief executive Tony Pidgley received shares worth 拢34.7m, PIRC said.

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