Bellway launches charm offensive to justify 'excessive' bonuses

Bellway’s big day out – January 16 – looks increasingly likely to be a ding-dong affair as the house builder digs in its feet to defy a powerful investor body, by continuing with its plan to pour huge bonuses into the pockets of its directors.

Bellway’s management team has been scrambled to woo shareholders with a series of phone calls designed to win their backing, according to today’s edition of the Daily Mail.

The problem surfaced when the Association of British Insurers issued a “red-top warning” advising its members to vote down the deal that will see the executive’s pick up around £630,000, despite Bellway’s share price falling by 25% last year and sales tumbling by 50% in the same period.

ABI is an influential voice as its members own 20% of all the shares in companies quoted on the London Stock Exchange.

A “red-top” rebuke is designed to instigate a revolt at Bellway’s annual meeting, with shareholders standing up and voting against the controversial proposal.

The Mail says that the ABI is “concerned that the Newcastle-based group has scrapped the performance targets that determine the level of a director’s reward and paid the bonuses anyway”

Another development is that Pirc, another investor body, has also entered the fray and is standing shoulder-to-shoulder with ABI.

Pirc is advising it own members to oppose the remuneration report.

The Daily Mail quotes Pirc as saying: “Potential maximum awards are considered to be excessive in our view”.