A date has been set for Purplebricks’ shareholders to give their verdict on a controversial remuneration package given to the agency’s senior executives.
The AGM of the agency has now been set for Tuesday September 28; the company hopes it will be an in-person event although it says it is closely monitoring the Covid-19 situation as the date nears.
Earlier this summer Purplebricks’ annual report revealed that a short term bonus scheme to provide incentives for executive directors to meet financial and strategic objectives saw more than a five fold increase in sums paid this year.
In the year to the end of April 2020 the payment was £100,000 - but in the year to the end of April 2021 the figure was £530,000. In addition, during the year to the end of April 2021 pension contributions of £17,000 were paid to executive directors; that’s 70 per cent more than in the year to April 2020.
Since April this year, of course, the company has undertaken drastic changes to its employment policy - Local Property Experts are now to be staff, not self-employed - and the pricing model has been changed to include a money back guarantee (with strings).
Looking at the current financial year, the Purplebricks annual report says: “Considering strong performance in the round, the group’s financial resilience and the importance for the group of their personal leadership in the year, we considered the outcomes of £285,000 for [group chief executive] Vic Darvey and £245,000 for [group chief financial officer] Andy Botha as appropriate.”
Last month - in a separate announcement to the annual report - it was revealed that almost a million shares in Purplebricks had been awarded to the two top execs. Darvey received 735,437 option shares and Botha got 307,500.
They can be cashed in after three years subject to the pair still being at the agency and meeting performance thresholds.
Purplebricks’ remuneration committee - chaired by non-executive director and IT entrepreneur Simon Downing - says in the annual report that its objectives include: “to ensure the remuneration package of the Executive Directors is balanced between fixed and performance-related elements, and is sufficiently competitive to attract, retain and motivate Directors of the right calibre to achieve the Company’s objectives without making excessive payments; and to ensure that the Company’s share plans operate appropriately and align all participants to the delivery of the Company’s strategy.”
The AGM will be the first time that shareholders in the company will be asked to vote to approve the Directors’ Remuneration Report, by way of an advisory non-binding ordinary resolution.