What Are WPP’s Succession Plans With CEO Martin Sorrell Under Investigation?

Insiders consider who could lead the company

Who would take Sorrell's place were he ousted?
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As the board of WPP investigates claims of “personal misconduct” and possible misuse of company assets against CEO Martin Sorrell, investors are likely starting to consider who should really be at the helm of the world’s largest advertising holding company.

“It’s a little difficult because we don’t know what the specific allegations are,” Pivotal Research Group senior analyst Brian Wieser told Adweek. “What I think investors will focus on is some broader implications around succession.”

Wieser said the investigation would “reinforce a narrative around who should be running WPP,” but he did not venture a guess as to who might take over as CEO.

Meanwhile, some in the industry are concerned about WPP’s succession plans.

“While there’s no shortage of strong candidates, none have the financial acumen and insights of the current CEO,” said Greg Paull, principal at global consultancy R3.

Paull suggested Mark Read, global CEO of Wunderman, or Kantar chairman and CEO Eric Salama could replace Sorrell, saying both have “been groomed for bigger things for a long time.”

“Both lead important data-centric businesses that are at the heart of modern marketing … but either of them would need to closely partner with CFO Paul Richardson to come close to matching the current dynamic that Sorrell offers,” Paull said.

An industry executive with direct knowledge of the matter claimed WPP “hasn’t done a great job” of mapping out a succession plan.

The source also suggested employee and client morale has suffered at WPP since March’s weak 2017 financial results and given the current investigation.

“Martin has been a steady—maybe not always benevolent, but a steady—presence [at WPP],” the executive said. “But now, the lack of financial performance followed by these allegations will rock people’s world at WPP.”

The Wall Street Journal broke the news of the investigation against Sorrell on Tuesday afternoon, reporting that WPP hired an independent law firm to look into the allegations. Later that day, London-based Project Associates issued a statement on Sorrell’s behalf in which the CEO rejected the allegations “unreservedly.”

WPP shares were down as much as 3 percent today on the London Stock Exchange following the news.

The company received more bad news today as WPP’s J. Walter Thompson reached a settlement with its global chief communications officer Erin Johnson, who sued the agency’s former CEO, Gustavo Martinez, for sexual harassment in 2016.

A company representative confirmed to Adweek that Martinez “is and continues to be working on assignments for WPP in Spain.”

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