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WPP slashes Sir Martin Sorrell’s pay package

Changes: WPP boss Sir Martin Sorrell has seen his pay packet cut: REUTERS
Changes: WPP boss Sir Martin Sorrell has seen his pay packet cut: REUTERS

Advertising giant WPP on Friday attempted to calm shareholders’ “increasing discomfort” over soaring executive salaries, by slashing chief executive Sir Martin Sorrell’s maximum pay.

In a move expected to be welcomed by a growing chorus of City investors demanding a crackdown in the AGM season, it revealed a series of cutbacks in its annual report.

Under proposals outlined earlier, Sorrell would see his potential payments under a five-year share plan to 2021 slashed.

Coupled with cuts to short-term bonuses and pensions, his maximum package will fall to £13.2 million from £18.4 million a year.

Sorrell has been a lightning rod for corporate pay critics because of huge payouts under a previous more generous scheme, known as “Leap”.

The so-called Sage of Soho saw his 2016 pay fall to £48.1 million from £70.4 million after the value of that scheme plunged. It was replaced in 2013 with a less generous scheme that is now being further reduced.

Sir John Hood, chairman of the compensation committee, said: “Notwithstanding the company’s superior performance, we understand share owners’ increasing discomfort.”

WPP joins a number of businesses — including consumer goods firm Reckitt Benckiser — which have recently cut executive pay and benefits after shareholder pressure.

Sorrell will face his latest showdown with investors at the company’s annual meeting in June.