WPP confident of backing for Sorrell package

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The Independent Online
WPP, the advertising company, is "very confident" it has secured a significant majority of votes in favour of its revised remuneration package for Martin Sorrell, its chief executive.

The company estimates at least 70 per cent of shareholders will vote in favour of the package at the extraordinary meeting on Monday. Of the dissenters, some have said they would prefer to vote in favour of the revised package, but did not have time to discuss the vote with trustees before the meeting.

Others, including Standard Life, are still believed to be intending to vote against the package, concerned that the compromise did not go far enough to introduce a measure of financial performance in addition to the targets related to share price appreciation.

A compromise thrashed out with key institutions on Thursday, which led to the introduction of more onerous performance conditions to the pay package and removed some contentious incentive elements, salvaged a proposal some said could have attracted only a bare majority of support from institutional shareholders.

Separately, US shareholders continued to express surprise yesterday that the package, originally worth an estimated pounds 31.6m at the top end of the incentive range, had attracted such hostility in the UK.

"We sent in our proxy in favour of the original proposal and certainly have no problems with the revised package," Bill Miller, of Legg Mason, said. "Martin is the head of an international advertising company, and his package needed to reflect that." Legg Mason speaks for about 1.5 per cent of WPP.

The original package had been developed in reference to rumuneration schemes set up for the chief executives of seven "international" advertising agencies. Of these, two - Omnicom and Inter-public - were judged to be the closest in structure to WPP, given that both are holding companies controlling several distinct agencies.

Omnicom's Bruce Crawford and Inter-public's Phil Geier both have packages made up of salary, bonus, pension and long-term incentives. Under Mr Sorrell's original package, both would have earned considerably more at lower levels of growth.