Blackfriar: Criticism of Persimmon's bonus scheme is not going to go away

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If Jeff Fairburn, CEO of Persimmon, thinks his announcement that he will hand some of his £110m bonus to charity will bring an end to months of criticism, he is sadly wrong.

Blackfriar has known Mr Fairburn for a long time and he is a decent, honest man who is extremely good at his job.

In a personal statement, Mr Fairburn said he always intended to give a "substantial amount" of his triple-digit award to charity, and regrets not making his feelings public sooner.

As he points out in his defence, the introduction of the bonus scheme pre-dated his appointment as chief executive and he had not sought out the bumper pay awards.

This statement indicates a change in Mr Fairburn's position and its tone and content suggest some acceptance of what was wrong with the bonus scheme.

However, the lack of detail about how much exactly Mr Fairburn will donate and which charities will benefit means the controversy is far from over.

It is understood that the chosen charities will receive a substantial portion of the £110m Mr Fairburn is in line for and will run to "many millions of pounds".

There are no plans to disclose a time period to distribute the money and it is understood that a wide range of charities will benefit, but they won't be named.

This story isn't going to go away until Mr Fairburn makes a full and frank disclosure.

Stefan Stern, director of independent think tank the High Pay Centre, said: "Mr Fairburn has said 'substantial', but we don't know what that means and he might come under pressure to be more precise. You could argue that £200,000 is a substantial amount, but that would not make a dent in his bonus.

"This tells us that shame and embarrassment still matter. He has been shamed into doing it.​ ​It is an encouraging sign that some things are intolerable and shameful and have to be reversed."

Blackfriar balks at the idea that Mr Fairburn has been shamed into this announcement. ​He is a private man who wanted to donate the money he is entitled to in a private fashion.

​Some investors in Persimmon may be relieved that millions of Mr Fairburn's ​bonus will go to charity, particularly the Church of England and the Methodist Church, which have both expressed their dismay over the bonus scheme.

Others may demand​ that some of his bonus be given back to shareholders, but this doesn't wash - they have already earned hundreds of millions of pounds through dividends over the past five years.

Mr Fairburn may not want to reveal his private charitable donations, but he may well have to if he wants to draw closure under this sorry period which has already cost Persimmon i​ts​ chairman and the head of its pay committee​, who both​ quit last year after they failed to curb the scheme​.

A full and frank disclosure will bring an end to a story that has marred the excellent performance of Yorkshire's biggest PLC.

​Blackfriar has been watching Sirius Minerals​, the developer of the £3bn North Yorkshire polyhalite mine, with increasing admiration over the past few years.

The mine is the brainchild of Chris Fraser, the group's managing director and CEO, who is a man who doesn't understand the meaning of the word impossible.

He had a dream and he will make it happen, whatever obstacles are put in his way. The hapless politicians in charge of Brexit could learn a lot from Mr Fraser.

The latest development is the surprising news that Sirius has awarded its shafts drilling contract to DMC after ending discussions with AMC UK.

As analysts at Shore Capital noted - don’t attempt hardball with Sirius. You won't win, as AMC has learned to its cost.

The new arrangement with DMC could bring forward production by up to six months and that is very good news for the hundreds of Sirius investors who live in Yorkshire and have backed the scheme from the start.