A leading City shareholder consultancy firm has branded Countrywide’s most recent remuneration package for its top executives as “excessive and unduly complex”.
The deal, which shareholders are being asked to vote on, would see Executive Chairman Peter Long, Group MD Paul Creffield and Finance Director Himanshu Raja receive shares worth between them £20m.
Institutional Shareholder Services (ISS), in a report leaked to Sky News, also says the package is too loose in its “calculations of awards”.
“No compelling explanation has been provided as to why the proposed arrangement is essential to effectively implementing the group’s strategy and turnaround plan,” says ISS.
The package will be applicable to 15 executives at the top of Countrywide, which includes a cap of no more than 15% of the incentive ‘pot’ offered to any one executive.
These are believed to include senior managers such as Peter Curran (MD of Financial Services), Paul Chapman (COO) and Paul Wareham (MD Business to Business).
Despite City ‘outrage’ among investors at the package and ISS recommending that it should not be accepted, the deal is likely to go through.
Oaktree Capital Management, which holds a third of shares in Countrywide, is hoping to make a killing if the company can be turned around, and is therefore expected to vote the incentive plan through.
Anger over the package is based largely on the decision earlier this month to raise £129 million in debt refinancing via two share offers at just 10p a share. The company’s share price consequently fell off a cliff, from 49p a share to 14p, a price at which it has flatlined since.