Foxtons shareholders just voted through a 19 per cent wage hike for its chief executive – despite a fall in share price
More proof that 2016's so-called shareholder spring is more of a trickle of dissent? Foxtons shareholders have voted through a 19 per cent payrise for chief executive Nic Budden – despite the fact shares have plummeted in the last year.
In a statement this afternoon, the estate agent, which focuses on properties in central London, said 79.3 per cent of shareholders had approved the motion to hike Budden and his fellow senior executives' pay at its annual general meeting (AGM).
Last month the estate agent admitted an increase like this "is unusual", but added it had taken the decision after "careful consideration and consultation with key shareholders".
Today it added: "The remuneration committee consulted with the majority of the company's shareholder base regarding the remuneration policy prior to the AGM and this is reflected in the significant level of support received for the directors' remuneration report.
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"We recognise, however, that not all shareholders have voted in support and we value their feedback. The remuneration committee will continue to have a dialogue with major shareholders regarding remuneration matters ahead of the 2017 AGM when the company's remuneration policy is next scheduled to be put to the vote."
You can understand why not all shareholders were in support (indeed, one major investor encouraged others to vote against the report): the company's shares are down 40.6 per cent in the past year, from 265p last May to 157.2p in mid-afternoon trading today.
Buy to let slowdown
Of course, that's partly thanks to new rules on buy-to-let homes, which are beginning to bite. In April rules came into effect which raised stamp duty for would-be landlords by three per cent.
By all accounts, the sector experienced a buying frenzy in the weeks leading up to the deadline – but experts have suggested this could turn into a longer-term slowdown.
Notting Hell?
Then there are uncertainties around the EU referendum, which have caused those interested in Foxtons' patch, Prime Central London (traditionally a hotspot for investors from the EU and elsewhere), to pause for thought. City PM reported earlier this week that some of the areas which in recent years have experienced the highest growth in house prices, such as Notting Hill, where prices have fallen 10 per cent in the past year.
Alas, Notting Hill is right at the heart of Foxtons' market: in fact, that's where it started. So you can see why it might be keen to canvas investor opinion on bosses' pay. Now, more than ever, it needs their support.