WPP faces shareholder revolt over Sorrell’s big payout

The world’s biggest advertising agency WPP faced a shareholder revolt over its handling of the departure of former CEO Martin Sorrell after large votes against the chairman and the company remuneration report.

Sorrell quit the marketing giant he built from scratch following an allegation of personal misconduct in April.

Nearly 30% of WPP investors failed to back its executive pay proposal on Wednesday, while almost 17% of shareholder votes declined to support the re-election of Roberto Quarta as chairman. Sorrell was allowed to leave with share awards worth millions of pounds intact and without a non-compete clause, rekindling arguments that WPP paid Sorrell too much and did not prepare for his departure.

Neither Sorrell nor the company have revealed the nature of the complaint, but Sorrell, who has already launched a new venture, has denied any wrongdoing.

Quarta said at the beginning of the group’s annual meeting that the process the board followed in response to the allegation against Sorrell was robust from a governance and legal perspective. He said share awards due in future to Sorrell pre-dated the current board’s involvement and he accepted that some investors found the situation unsatisfactory.

“I know that questions remain, but there is simply nothing further we can legally disclose,” Quarta said. He told investors that the hunt for a new CEO was well advanced.

Shares in WPP traded up 0.7% early on Wednesday, slightly ahead of Britain’s bluechip index which was trading 0.4% higher.