Scholefield was made UK MD in 2015 when UK CEO Alison Clarke stepped down and had been with the agency for just over a year prior to that promotion. Grayling has not had a UK CEO since Clarke's departure.
Scholefield told PRWeek that she felt the promotion was "less of a change of job, and more a recognition of my contributions to the company".
The company's revenue has fallen sharply in recent years. Global revenue was down by nearly a quarter last year, while UK revenues dropped by a fifth to £13.5m, making it the 22nd largest agency in the country, according to new the PRWeek UK Top 150, published this week.
However, Scholefield said it was "a very optimistic time for Grayling in the UK", saying: "I've been spearheading the turnaround for Grayling, there is huge change, we're winning more business, winning global mandates, winning in areas we had not worked in before."
She pointed to a "creative" brief with M&S won earlier this year as an example of this. Other recent wins are to be unveiled shortly. Grayling also retained major client British Airways last year.
However, the firm also lost longtime consumer lead Daniel Cohen; PRWeek revealed last month that Cohen would be joining Lewis shortly.
Scholefield said: "We have started 2017 very strongly and I look forward to building on this success moving forward."
Paul Taafe, who became Huntsworth CEO two months prior to Clarke's departure, said: "Grayling UK continues to emerge from a transformative period and this is absolutely the right time to promote Sarah to her role as chief executive of the UK business as we capitalise on the new management and focus she has overseen.
"As chief executive, Sarah will continue to build and grow the business, supported by the existing management team."
