Berkeley Investors Should Reject Executive Pay Plan, PIRC Says

Berkeley Group Holdings Plc (BKG) shareholders should reject the real-estate developer’s executive-compensation plan at the company’s Sept. 5 annual meeting, said Pensions Investment Research Consultants Ltd., an investment adviser.

Incentive pay at the U.K.’s largest homebuilder by market value, including a bonus of as much as 300 percent of base salary, is “excessive” for a U.K.-listed company, PIRC said in a statement today. Stock options in long-term incentive pay would be granted at a 73 percent discount to the current share price and “no performance target is required,” PIRC said.

“Potential and actual payouts for executive variable pay are excessive,” PIRC said. “This concern is compounded by the fact that salaries rank at the top” in comparison with peers.

Berkeley spokesman Tim Robertson wasn’t available for comment when called by Bloomberg.

Berkeley, the best-performing U.K. homebuilder this year, has benefited from its concentration in London and southeast England, where the recovery in house prices has been the strongest. The Cobham, England-based company abandoned high- volume homebuilding in 2004 and concentrated on houses rather than apartments in urban areas.

Berkeley has risen 17 percent in London trading this year, beating the Bloomberg EMA Homebuilders Index, which has fallen 4.6 percent in that time.

PIRC, based in London, provides consulting services to institutional investors.

To contact the reporter on this story: Jeff St.Onge in London at jstonge@bloomberg.net.

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net.