Advertising giant WPP next in line to face an investor uprising
IF A bookmaker offers you odds on whether or not global advertising giant WPP will face a pay revolt this summer, take it, as you will never find easier money.
WPP will surely face an investor uprising in June
WPP is all but certain to face an investor uprising at its annual general meeting in June.
That is because on Friday, it revealed that last year it paid founder and chief executive Sir Martin Sorrell £70.4million in basic salary and short and long-term bonuses.
It is a phenomenal amount and represents a 64.9 per cent uplift on his 2014 remuneration.
However the big question facing shareholders is does Sorrell actually deserve his £70.4million bonanza?
Looking at things purely on a numbers basis, it is hard to argue against the pay award.
WPP revealed that last year it paid Sir Martin Sorrell £70.4million
Unlike other executive pay flashpoints such as at BP, WPP has actually performed well.
Sorrell has built the firm up from scratch into the world’s biggest advertising agency and has consistently beaten every revenue, profit and growth target.
At the same time, investors have been very well rewarded.
Over the past five years the shares have more than doubled to £15.96 per share and dividend payouts have risen too.
WPP investors have been very well rewarded
If shareholders decide that the reason why Sorrell got paid £67.1million in bonuses last year was because his targets were too easy to hit, they need to take responsibility for it as they agreed to said targets in previous years.
Then they need to make sure that future bonus payouts are a lot, lot tougher to achieve.