Britain’s biggest housebuilder, ­Persimmon, is under heavy pressure from major shareholders to oust Jeff Fairburn, its chief ­executive, unless he agrees to give up most of a highly ­controversial £110m pay package.

A coalition of some of the City’s ­biggest investors, including a handful of Persimmon’s top 10 shareholders, is understood to have warned the company that the record-breaking payout is “unsustainable”.

One told The Sunday Telegraph that it would want to see Mr Fairburn give up at least 90pc of his pay in order to keep his job, “and even that would be very generous”.

“At the end of the day, it’s simply far too much money for putting up a few timber-framed houses”, the investor said. Anger over Persimmon’s executive pay scheme has already claimed the heads of Nicholas Wrigley, the chairman, and Jonathan Davie, the ­remuneration committee chairman.

Jeff Fairburn is under pressure to surrender much of his £110m payout

The pair stepped down in December after admitting to failures in the design of the company’s Long Term Incentive Plan (LTIP) by neglecting to cap the maximum potential bonus.

Shareholders have now turned their fire on Mr Fairburn, who has so far ­rejected suggestions he should agree to forfeit any of his bonus or donate it to charity. He has argued that “at the end of the day, the business has done very well”, and “you’ve got to put this into the context of what has been achieved”.

Mr ­Fairburn has already collected the first £45m. Shareholders said it would now be impossible for Mr Fairburn to stay in his role without making major ­concessions.

Investors are concerned about the damage to Persimmon’s reputation, with the bonus highlighted by politicians. One top-10 shareholder suggested the company could lose sales and they questioned the company’s ability to motivate Mr Fairburn in future, given his massive wealth.

Another claimed a £110m bonus was likely to attract tighter regulation of the house-building industry, such as an attack on land banking.

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Politicians have already pointed to the way Mr Fairburn has benefited from the Government’s Help to Buy scheme. The subsidies have boosted demand for new-build homes and lifted the Persimmon share price, inflating Mr Fairburn’s bonus. The shares have nearly trebled since George Osborne launched Help to Buy in 2013.

Investors also fear the controversy will set back progress on excessive pay. Corporate governance specialists chalked up a string of victories last year as binding votes on remuneration policies forced boards including BP and Imperial Brands to rethink.

City governance sources have been disappointed in Theresa May’s failure, however, to tighten the regime further and view Persimmon as a key test of ­investor power.

Persimmon’s LTIP, believed to be the most expensive ever undertaken by a UK corporate, is also making generous payments to around 140 senior staff. The scheme was designed and ­approved by shareholders in 2012.

One of the company’s biggest investors said the City had failed to spot the potential for record-breaking bonuses, partly because Britain was still crawling out of recession. Investors had not anticipated such strong rises in house-builder valuations.

Persimmon declined to comment.