Investors could stage a pay revolt at WPP’s annual meeting tomorrow amid growing concerns about the ever-increasing remuneration for the advertising giant’s top staff Sir Martin Sorrell.
The main focus is the handsome reward earned by Sir Martin Sorrell, who retained his mantle as the FTSE 100’s highest-paid chief executive when it was revealed that his pay leapt by 43 per cent last year. This means Sir Martin could take home £43 million this year, taking his total earnings during the past six year to more than £100 million.
A major investor in WPP has said it plans to stage a revolt at Tuesday’s annual meeting amid mounting concern over the scale of executive pay at the marketing giant.
The shareholder, which asked to remain anonymous, has been a long-time critic of the firm’s pay policy that this year will see boss Sir Martin Sorrell walk away with £43million.
Unless there is a last minute change of heart, the investor told the Mail it plans to vote down the pay policy, as it has done in previous years. It is expected to be joined by a sizeable group of fellow investors who feel their concerns have fallen on deaf ears.
Investor group Glass Lewis recommended shareholders vote against Sorrell’s pay.
Fellow advisory group Institutional Shareholder Services criticised Sorrell’s pay but stopped short of recommending a no vote.
Last year 30 per cent of investors failed to back the firm’s lavish remuneration policy. But this year rather than scale it back WPP increased Sorrell’s pay package by 43 per cent.
This has sparked an amber alert from the Investment Management Association, which advises members who own around 15 per cent of FTSE 100 companies’ shares.
An amber alert is its second most severe warning and it said: ‘Given the overall pay levels, shareholders will also want to review the level of benefits payments to Sir Martin Sorrell.’
However, despite the opposition it is not thought that as many as 30 per cent will fail to back the firm’s pay proposals on Tuesday.
Sorrell will receive a flat £1.1million base salary, along with a £456,000 pension contribution, short-term incentives of £3.5million and long-term awards of £36million. On top of this he receives £453,000 of benefits. This includes £274,000 to take his wife around the world with him.
The £43million-a-year advertising boss is also paid a £50,000 accommodation allowance when he is abroad if he stays in homes he owns – such as his flat in New York – because he is saving the firm on hotel expenses.
There is also £43,000 for undisclosed ‘other expenses’, understood to include membership of clubs, security and an office at home.