In May, Greg Fitzgerald, who’d been the chief executive of Vistry (VTY) since 2017, also began chairing the housebuilding group. Combining the two roles goes against governance guidelines. To justify the decision, the outgoing chair said it was to “ensure consistency and maintain momentum in the execution of the group’s strategy and delivery of the medium-term targets”.
That explanation, though, merely described much of what Fitzgerald was already doing as chief executive. In fact, his appointment followed the resignations of three of Vistry’s six non-executive directors last year. Two of the current six are American, one of whose fund owns 9 per cent of the group. Their approach, according to an interview Fitzgerald gave to Building, a trade magazine, is “poles apart” from that of UK investors. Why was he taking on both roles? In part, he said, “to bring some stability to the board”.
The risk of the combined role is that a dominant boss might short-circuit checks and balances, and weaken the board’s oversight and effectiveness. At Vistry’s AGM in May, Fitzgerald attracted a protest vote of about 20 per cent, but most investors backed his ambitious growth plans. He’s regarded as charismatic and hard-driving, and said to be self-motivated with “a sense of urgency” bordering “almost on hyperactivity” – on his own admission, he’s “extremely demanding and straight talking”. One rumour last year revolved around a proposed pay deal for him of US proportions. For an executive so self-driven, paying more is unlikely to make much impact on performance, and Fitzgerald says he turned it down. Last year, he received a notional £3.2mn, and his current package could pay out £5.6mn (assuming a static share price), but only if he achieves his stretch targets, which now seems unlikely.