Misconduct probe could cost Sorrell £34million

ADVERTisinG chief sir Martin sorrell could lose a £34m bonus if he is sacked at WPP over misconduct claims.

sorrell has up to 2.9m shares coming his way under various bonus schemes, which are worth around £33.7m at the current price.

But if he is forced out of the world’s biggest advertising agency over the claims, which relate to financial impropriety and personal misbehaviour, the board could refuse to cough up anything.

it would almost certainly trigger a legal challenge by sorrell, setting the stage for a courtroom showdown in which the details of the allegations would be made public.

Three top legal firms are involved in the probe against the boss, who is a leading Brexit opponent and one of the world’s richest executives.

He holds the record for the biggest pay day of any public firm’s director in City history, taking home £70m in 2015 in a bonanza that shocked even seasoned observers.

sorrell, who is worth an estimated £495m, denies the allegations made against him.

investigations into his behaviour are continuing but pressure is growing amid rumours of an ugly boardroom rift.

The chief executive, who has built WPP up from nothing over the past 33 years, has no notice period under the terms of his contract, so it can be terminated at any time.

But he also enjoys a special protection which makes it harder for the company to refuse to pay him his bonuses.

other executives’ payouts can be forfeited if the board makes the decision that they were a ‘bad leaver’.

But this rule does not apply to sorrell, 73, so his shares can only be taken away from him if he is sacked by the company for extremely serious wrongdoing.

He will only receive all of his stock awards if WPP hits various targets under his leadership over the next four years.

The twice-married father of four is thought highly likely to take legal action if he is ditched by WPP and loses out financially as a result.

Any case could drag on for months and degenerate into a vicious shouting match in full view of the public. The crisis at WPP is understood to have started when a whistleblower contacted the board about sorrell’s behaviour. The person making the complaint was seen as a credible witness and directors are said to be taking the claims very seriously.

supporters of sorrell have argued that at least one fellow board member wants him out following a slump in the company’s share price.

They claim that the allegations are being used by enemies with an agenda.

But another insider insisted there was no rift and that the allegations about the chief executive’s conduct were extremely serious, even though the amount of money said to be involved is small in comparison to the size of the £14.6bn company. Meanwhile, sorrell insists he has done nothing wrong.

When the allegations came to light, he said: ‘Reports in the media have stated that WPP is investigating an allegation of financial impropriety by me, specifically as to the use of company funds.

‘This allegation is being investigated by a law firm.

‘i reject the allegation unreservedly but recognise that the company has to investigate it.’

sorrell and WPP declined to comment last night.