WPP Plc’s Martin Sorrell is the highest-paid chief executive officer of a company on Britain’s benchmark FTSE 100 index after shareholders approved the 69-year-old’s 2013 pay package.
Sorrell’s earnings as chief of the world’s biggest advertising agency surged 70 percent last year to 29.8 million pounds ($51 million), thanks to a long-term incentive plan called LEAP, based on WPP shares over five years. In today’s shareholder meeting, 81.75 percent voted for Sorrell’s pay award.
The Local Authority Pension Fund Forum yesterday advised voters to oppose London-based WPP’s remuneration policy, calling it “excessive” and citing complex variable pay arrangements to directors. U.K. Business Secretary Vince Cable has urged FTSE 100 companies and banks to curb excessive remuneration packages or face new legislation that could limit pay. In 2012, investors voted to block Sorrell’s pay package.
Today’s approval for Sorrell’s remuneration makes him the highest-paid CEO of a FTSE 100 company, according to a WPP spokesman. Sorrell said last week that WPP is on track to beat 2013’s full-year revenue, helped by the Winter Olympics in Sochi and soccer World Cup in Brazil. WPP remains the ad world’s leader after the failed merger of peers Publicis Groupe SA and Omnicom Group Inc. in May.
WPP’s shares have advanced about 16 percent in the past 12 months, giving the company a market value of more than 16 billion pounds.
In a letter to the U.K.’s biggest listed companies, before the season of annual general meetings, Cable said he would be “vigilant in assessing” boardroom responses to rules he introduced requiring companies to give investors a binding vote on pay packages.
The LEAP plan was discontinued last year though payments under it will continue for several years. WPP investors approved a new long-term incentive plan in 2013 that cut the maximum value of shares Sorrell could get over a five-year period to 11.2 million pounds from 22.75 million pounds. It also included a 150,000-pound pay cut to his annual salary to 1.15 million pounds.
WPP’s sales rose 6.2 percent last year to 11 billion pounds, buoyed by growth in North America, as profit before interest and taxes gained 8.5 percent to 1.66 billion pounds.