PERSIMMON'S long-serving chairman is stepping down, with his resignation attributed to the omission to set a cap on a long-term executive bonus scheme.

Nicholas Wrigley, who has chaired the company since 2011, quit after it emerged the long-term incentive plan (LTIP) introduced by Persimmon for its executive team in 2012 did not include a cap. Senior independent director Jonathan Davie, chairman of the firm’s remuneration committee, has also resigned. Neither Mr Wrigley, who first joined the Persimmon board in 2006, or Mr Davie were beneficiaries of the LTIP scheme.

Persimmon acknowledged yesterday that the LTIP has been a significant factor in the company’s “outstanding performance” in the period since its introduction.

It said: "Nicholas and Jonathan recognise that the 2012 LTIP could have included a cap. In recognition of this omission, they have therefore tendered their resignations."

According to its most recent annual report, the company’s remuneration committee decided not to make LTIP awards to existing executive directors in 2016. The report states that, while awards have previously been made under the 2012 LTIP, these have a performance condition linked to the return to shareholders of £6.20 per share over the period from 2012. The first opportunity to exercise, up to a maximum of 40 per cent of the vested shares, falls on December 31 this year.

Persimmon said it has returned £1.5 billion to shareholders since the LTIP was approved in 2012. Its recent annual results show it hiked pre-tax profits by 23 per cent to £774.8 million in 2016. Shares closed down 4.2p at 418p.