Housebuilder Persimmon could take a battering at its annual general meeting (AGM) on Wednesday, as disgruntled investors prepare to turn down a pay report which handed its chief executive a £100m bonus.
Though Jeff Fairburn will only receive £75m of the reward, having pledged in February to give up £25m to a charitable trust, several investors are still furious about the scheme.
City A.M. understands that as many as half of investors could turn down the report or abstain from a vote, with one source close to the matter saying the divide was "too close to call".
Persimmon, meanwhile, has been attempting to persuade investors that its performance justifies the payout, saying that the business has created almost £8bn of shareholder value since the long-term incentive plan (LTIP) was introduced in 2012.
In a note last month, analysts at Jefferies said that the housebuilder had "outperformed its peers and the UK housing market itself" and that they were "not sure why some are choosing to penalise Persimmon for building more homes and generating cash for shareholders".
But Persimmon's chairman Nicholas Wrigley and Jonathan Davie, the head of the remuneration committee, have already resigned this year in recognition that the LTIP – which offered uncapped bonuses – was badly designed.
Meanwhile, the Investment Association has said that recent corporate governance reforms have placed an emphasis on executive pay which is likely to play a key role in the 2018 AGM season.
Unilever could come under fire for these reasons, as the Investment Association issued a "red-top" warning and two shareholder advisory groups recommended that investors vote against the remuneration report.