WPP faces another shareholder mutiny over Sorrell’s rewards
WPP is facing another shareholder revolt at its annual meeting after it increased the pay package of the advertising giant’s ebullient chief executive Sir Martin Sorrell to £43m.
Shareholder advisory groups lined up to criticise the marketing mogul’s rewards, which have been doled out despite last year’s protest where almost 30pc of investors refused to back its remuneration policy.
WPP defied last year’s revolt and increased Sorrell’s pay package by 43pc.
That has sparked an amber alert – suggesting ‘shareholders will want to review the level of benefits payments’ – from lobby group Investment Management Association, which advises members who own about 15pc of the shares on the FTSE 100. Sorrell
( pictured) will receive a £1.1m base salary, along with a £456,000 pension contribution, short-term incentives of £3.5m and long-term awards of £36m. On top of this he receives £453,000 of benefits, including £274,000 for his wife to accompany him on globetrotting business trips. The highest paid chief executive in the FTSE 100, he is also given a £50,000 accommodation allowance when he stays in his own homes while doing business overseas – such as his flat in New York – on the grounds he is saving the firm money on hotel expenses. There is also £43,000 for undisclosed ‘other expenses’, understood to include membership of clubs, security and an office at home.
Over the past six years Sorrell has pocketed £120.98m but shrugs off criticism arguing he started the business from scratch and has created value for shareholders along with thousands of jobs. Shareholder group Glass Lewis recommended investors vote against Sorrell’s pay. Institutional Shareholder Services said the pay ‘remains exceptionally high’ but stopped short of recommending a no vote.
WPP won its first binding vote on pay last year with a comfortable majority, giving it a mandate to reward Sorrell as it sees fit for three years. The vote this year carries no power other than to show sentiment.