Persimmon urged to change its culture after catalogue of mistakes

The York-based FTSE 100 firm said it is determined to eliminate cases of poor workmanship following dozens of customer complaints.

Stephanie Barwise QC, of Atkin Chambers and the leader of the review, said: “Persimmon’s culture must change.

“Persimmon cannot afford the stigma of a corporate culture which results in poor workmanship and a potentially unsafe product.”

However, Ms Barwise praised the firm for taking action to resolve its problems.

“The board of Persimmon deserve significant credit for commissioning this review and publishing its findings,” she said.

“It demonstrates their willingness to confront some difficult truths as they focus the business on rapid change and improvement.”

Earlier this year, Channel 4 highlighted the problems plaguing the firm when an independent building surveyor found nearly 300 faults in a new Persimmon house.

Persimmon said it has recently begun to take urgent action to improve its build quality procedures.

The group’s chairman Roger Devlin said: “This is a very thorough and comprehensive review with clear conclusions and recommendations in nine key areas.

“The review found that Persimmon had focused on policies around inspections immediately before and after the sale of a home, rather than those governing build quality inspections.

“In my view, this is one of its central findings and I am encouraged that the company is already embracing the review’s recommendations in this area through significant operational investment and procedural change.”

He said Persimmon has already taken positive steps in other important areas, such as being the first housebuilder to introduce a customer retention scheme, investing over £140m to date in additional work in progress and an additional £15m in annual quality and service costs.

“The review clearly shows that the surest route to improved customer satisfaction is through the delivery of consistent build quality and service and we acknowledge that we still have work to do,” said Mr Devlin.

“As we focus hard on the changes that we are making, I would like to take this opportunity to apologise once again to those Persimmon customers who have been affected in the past.”

The review also raised issues about the excessive pay given to former bosses. Former chief executive Jeff Fairburn was fired last year amid outrage over his initial £100m bonus deal amid complaints about the quality of Persimmon’s houses.

Ms Barwise said: “Persimmon came under intense public scrutiny following the disclosure of the amounts received by executive directors in 2017 and 2018... The amounts in question were widely perceived as excessive.

“It is important that the company’s remuneration policy is consistent with its purpose and strategy, and the culture it is seeking to foster.”

Mr Devlin concluded: “This review - and the seriousness that we attach to its detailed findings - is an important moment for Persimmon as we continue to build a different business with an increased focus on our customers and wider stakeholders – becoming a business that prioritises purpose as well as profit.”