ShareAction urges WPP to commit to living wage as shareholders approve Sorrell's pay packet

ShareAction, a charity that promotes responsible investments, has suggested WPP chief executive Sir Martin Sorrell's pay package be put towards ensuring the living wage for all its staff.

Sir Martin Sorrell: Controversy over pay packet
Sir Martin Sorrell: Controversy over pay packet

The call was made at WPP's annual general meeting on Tuesday, at which the firm reported a 1.8 per cent rise in like-for-like net sales in its PR and public affairs division, with growth reported in all regions except the UK and Continental Europe.

The resolution containing Sorrell's pay packet was approved at the AGM, although a significant number of shareholders registered their disapproval. Twenty per cent of those who voted opposed it, and voter turnout on that resolution, also 20 per cent, was markedly higher than for any other.

Sorrell earned more than £36m ($53m) in 2014 under the group's long-term incentive plan, with a total remuneration of £43m ($66.1m).

Speaking at the AGM, ShareAction trustee Roger Jeary said it "seems illogical WPP should not pay living wage rates". He said Sorrell's exceptionally high pay was a "risk" to the company's reputation.

Paul Richardson, WPP finance director, told the AGM the company was committed to meet the living wage standard. He added that of WPP's 23 operating companies, currently 22 per cent are compliant. He concluded: "I can reassure it is happening naturally across the group."

WPP defended Sorrell's compensation as a "contractual obligation", part of a five-year investment plan that was approved by 83 per cent of the group's shareholders.

Other issues raised at the AGM were lack of transparency over management succession and "Sorrell-centricity".

The board said it would be "disrespectful" to publicly name the leading candidates to take over from Sorrell.

Jeffrey Rosen, WPP director, added that such a move would "not help the co-operative spirit" between its subsidiaries, but that succession was at the "foremost of our minds".

Interviewed at an Institute of Practitioners in Advertising event in London in March, Sorrell said there was a succession plan in place at WPP should he leave the business – whether he was "hit by a truck tomorrow", or departed in three or five years' time.

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