WPP bonus approved but protest made
WPP SHAREHOLDERS staged a significant protest against the company’s new bonus scheme yesterday, after a quarter failed to back proposals which could see chief executive Sir Martin Sorrell take home £60m over five years.
Following its annual meeting in Dublin, the advertising and media group said that the Leadership Equity Acquisition Plan (LEAP) had been voted in by a majority of 75 per cent of shareholders.
However, the substantial opposition serves as a stark reminder to companies that investors are scrutinising executive pay more than ever before.
Under the approved scheme, senior WPP managers who invest in the company’s shares could be rewarded with up to five times as many free shares, as long as the firm hits key performance targets.
The vote, which also saw the executive remuneration plan approved, followed an earlier trading statement which revealed that trading had worsened in April.
WPP said that like-for-like revenue, which strips out the impact of acquisitions and currency, fell 6.7 per cent in the first four months of the year, compared to a 5.8 per cent fall in the first quarter.
“Although revenues were below budget for the first four months of 2009, headline operating profit and headline operating margin were both above budget,” WPP said.
To counter the fall in revenues, headcount fell by almost 4,300 or 3.7 per cent in the four-month period, with over half leaving on a voluntary basis.