Labour has insisted it is not toning down its nationalisation plans despite claims from a water company chief that a mutualisation-style approach has been discussed with opposition leaders.

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Labour has made forceful public statements on renationalising water – along with energy and rail – in recent months but a FTSE 250-listed utility claims the party is looking at alternative means of gaining control over the industry.

Susan Davy, the chief financial officer of Pennon, which owns South West Water, said that although Labour was publicly talking about full nationalisation, she had noted a more emollient position during discussions with the party.

“They’re pretty consistent in the way they’re talking about it in the media. But behind the scenes we’re beginning to see a bit more differentiation in how they’re talking about it,” she said in an interview with financialdirector.co.uk.

Davy added: “What’s interesting to us in the nuances of the Labour policy is that they are now drilling down much more. Their preference seems to be moving towards what we would call mutualisation, where you have some sort of model that allows customers to be owners. That’s where we can have a much more informed conversation.”

A Labour spokesman declined to say what areas had been covered in discussions with water industry leaders but said: “As we announced in the general election, the next Labour government will take public ownership of water by issuing bonds in exchange for shares in the companies. We are not considering mutualisation.”

The shadow chancellor, John McDonnell, has pledged total, “permanent” and cost-free renationalisation of the water, energy and rail industries if Labour wins power at the next election.

In February he attacked the privatised water industry, accusing companies of paying out a “scandalous” sum of £13.5bn in dividends to shareholders since 2010, while claiming huge tax breaks and forcing up water bills by 40% in real terms since privatisation of the industry in 1989. The heads of England’s privatised water companies were criticised by the GMB trade union this month for banking £58m in pay and benefits over the past five years while customers have received above-inflation rises in their water bills.

Davy, who received a pay package of £922,000 last year, said the water industry was seeking to impress on Labour the fact that the large majority of shareholders in water companies are owned by the public. “When you look at our model, and that of United Utilities and Severn Trent as well, 70% of our shareholders are pension funds, charities, employees – all in the UK,” she said.

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Davy added that Pennon was aligned to Labour’s position, regarding greater public say in how water is managed through its affiliation to the WaterShare initiative, in which an independent panel scrutinises Pennon’s performance, and financial benefits from better-than-expected results are shared with customers. “From our perspective, what we are already achieving is a long way to what they want,” she said.

The cost of nationalisation would be a significant hurdle, said Davy, referencing the thinktanks Social Market Foundation and the Centre for Policy Studies that recently quoted the cost of water nationalisation of £90bn and £86bn respectively.

“We’re building a body of evidence so they [Labour] can really understand where we’re coming from, rather than us just saying we don’t like the idea of nationalisation,” Davy said.