Almost a third of ZPG’s shareholders voted against a lucrative incentive scheme designed to keep chief executive and founder Alex Chesterman in his post until at least 2021.
Under what ZPG calls its Value Creation Plan (VCP), Chesterman will reportedly be able to earn as much as £62m over the next four years if he can deliver 20% growth in ZPG’s annual share price.
The scheme was originally devised two years ago to persuade Zoopla’s founder – described as ‘unique’ yesterday – not to leave the business before 2019.
The board yesterday asked shareholders to approve a revised remuneration policy that extends that plan for another two years.
At ZPG’s AGM yesterday, a majority of just over 68% voted in favour, but this was against what has been described as a “significant minority” of nearly 32%.
There was a similarly strong rebellion against approving the directors’ remuneration report for the year ended September 30, 2017.
Nearly 26% of shareholders voted against the plan, which gives Chesterman £1.7m worth of salary, bonuses and incentives.
ZPG remuneration committee chair, Sherry Coutu, said it was the committee’s “initial understanding” that some shareholders objected to chief finance officer Andy Botha receiving a pay rise of 16.4%.
She said: “The committee will engage with dissenting shareholders to discuss their concerns.”
On the decision to approve the incentive plan for Chesterman, she said: “The feedback from the consultation with shareholders prior to the AGM notice being published demonstrated strong support from the company’s top shareholders.
“The remuneration committee, through the extensive shareholder consultation exercise, knows why certain shareholders voted against the resolutions.
“The principal reason was that some shareholders disagreed with the remuneration committee’s view that the maximum potential opportunity under the extended VCP was necessary to incentivise and retain the company’s unique CEO and some disagreed with the VCP structure as a matter of principle.
“The remuneration committee will re-engage with dissenting shareholders to discuss further their concerns and explore how in operating the VCP they may be addressed, whilst not prejudicing the success of the company or jeopardising the majority shareholder view.”
Meanwhile, nearly all shareholders (99.7%) yesterday voted through the election of Lord Rothermere as a director of the company.
Rothermere is the chairman of Daily Mail owner DMGT, which currently has a 30% stake in ZPG. His appointment to one of the two seats that DGMT has on the board of ZPG was originally announced last month when it was revealed that he would replace Kevin Beatty.