Sir Martin Sorrell’s £70m: The defence (and not just from Sorrell and WPP)
Advertising giant WPP today confirmed Sir Martin Sorrell's pay package totalled £70m last year in its annual report. The figure included a £62.8m long-term bonus.
In recent weeks, Sorrell has been forced to defend his pay. And, perhaps unsurprisingly, WPP's annual report also defended its chief executive and founder: “While the value of Sir Martin Sorrell’s award is very large, it was the result of an outstanding set of returns to share owners.”
But WPP and Sorrell aren't the only ones defending the £70m.
Read more: Martin Sorrell defends £63m pay package: "If WPP does well, I do well"
Analysts and one advertising industry expert interviewed by City PM pointed to WPP's strong performance when compared with rivals, Sorrell's long-standing position at the company and the fact he owns a large stake in the company. One analyst predicted he will not suffer from the so-called shareholder spring at WPP's June annual general meeting.
Roddy Davidson, media analyst at Shorecap: "It's difficult to get too upset"
The money that he's received from the company has been under remuneration schemes, performance-related schemes, that have been authorised by shareholders. So it's difficult to get too upset about that, although the sums involved are fairly extraordinary.
Will shareholders revolt?
I suspect there'll be a lot of discussion and comment and I suspect some shareholders may object formally. But my gut feeling is that most, with a bit of grumbling, will not oppose this. Because the proof of the pudding is in the eating. Martin Sorrell is delivering a business which is outperforming its peers, I think his performance in terms of strategy and investment has been first rate and that we're seeing that bearing fruit in the performance of the business.
Mark Lewis, dean of the School of Communication Arts: London Advertising School: "I think he deserves every single penny that he's getting"
He's a phenomenal leader. He and WPP are hugely responsible for the strength of the creative economy in the UK. We enjoy a first-placed position globally as a creative economy. And it's no accident that WPP is a company headquartered in London, and London is the world's capital of creativity.
Charlie Huggins, equity analyst at Hargreaves Lansdown: "We're not overly concerned"
Clearly it is a lot – there's not getting away from that, it is a big incentive package. But I would frame that by saying it has performed very well, which going forward is the most important thing. It has a very strong track record and a strategy that's worked well for a number of years and that it continues to pursue. It has been well managed over the years by Sorrell.
And he does own a very large stake. In a way, I'd almost be more concerned if it was someone who was being paid £3m a year but had no stake in the business.