WPP chief Sir Martin Sorrell quits advertising agency

WPP chief Sir Martin Sorrell quits advertising agency

So if WPP does well, I do well, and others in the company do well.

It follows an internal investigation into anallegation of personal misconduct against Sorrell, which WPP said has now concluded. Sorrell has denied the allegations, details of which have yet to publicly surface. According to a statement from WPP, Chairman Roberto Quarta, has taken over as the executive chairman until the appointment of a new CEO.

"Mark and Andrew are both highly accomplished and experienced executives who have the board's complete confidence", Quarta said in an emailed note to employees, a copy of which was seen by Bloomberg.

This would make them the front running internal candidates to take over from Sorrell, as the board also readies to reach out to its "constantly refined list of external candidates".

Sorrell, 73, said in a statement that he was sad to leave, with WPP having been his passion and focus for more than three decades. However, I believe it is in the best interests of the business if I step down now. I reject the allegation unreservedly but recognize that the company has to investigate it.

"The succession arrangements look like a sticking plaster and, until strong and credible long-term leadership arrangements emerge, there will be concerns about the sustainability of the WPP Group, as we know it today, and its strategic direction", said Guy Jubb, former global head of governance and stewardship at Standard Life Investments, an investor in WPP.

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A source close to Sorrell said he had been unhappy with how the investigation was handled, leaving him uncertain whether he could work with the board again.

Present in 112 countries, WPP serves clients including Ford, Unilever, P&G and a string of major corporations around the world.

WPP's biggest clients globally include the likes of Ford, Procter & Gamble and Unilever, which it services through traditional advertising agency networks such as Ogilvy, J Walter Thompson and Grey.

The migration of advertising online and the encroachment into market research of consultancies such as Accenture have compounded the pressures.

Sorrell also mentioned that a new generation of management, led by Mark Read and Andrew Sorrell WPP corporate development director and COO, Europe, have been appointed as joint chief operating officers of WPP.

Analysts believe Sorrell's departure combined with a share price slump of nearly a third over the past year means investors and the WPP board will have to consider that there is potentially more value in breaking up WPP.

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