Why WPP's Cryptic Handling of Martin Sorrell's Resignation Is the Wrong Move

"To this day, the improprieties that prompted Sir Martin to step down have yet to be made known, which seems unusual in an industry where such secrets don't stay secret for too long," PR veteran Peter Himler told Adweek today. Two days after Martin Sorrell stunned the global business world by resigning from his role as CEO of WPP after 33 years, industry consensus holds that the cryptic nature of his exit will ensure no swift end to the wild speculation about what led to the change—and what it means for advertising at large. An exit shrouded in mystery Many in the industry are still in shock, but some dynamics remain unchanged. Most major holding groups, including Omnicom, Dentsu and IPG, have declined to comment on the news. Former Publicis Groupe CEO Maurice Levy, however, took the opportunity to offer his longtime foe one more backhanded compliment. "It is sad to see Sir Martin Sorrell resign amid the investigation into his alleged personal misconduct," said Levy, who praised his rival as a "fierce competitor" who "may have been lacking in vision on occasion. "It is well known that our relationships were difficult, but I have always had respect for the entrepreneur and CEO. He always had the will to win, making all competitions against him extremely interesting and challenging," Levy added. "By contrast, I would be hard-pressed to say the same thing for the man and his behaviors—the press is full of examples." [kickout id="1" label="Question Mark"] Sorrell's resignation, Levy seemed to imply, is simply the latest example. "I would say that the news of his departure remains shrouded in some mystery. This is likely by design," said Himler, who spent 23 years in the WPP family, holding executive-level roles at Hill+Knowlton, Cohn & Wolfe and Burson-Marsteller before launching his own firm, Flatiron Communications. "The question is whether it will remain so." WPP's board of directors has all but ensured that a gray cloud will continue to hang over Sorrell's departure for the immediate future by closing the inquiry upon his resignation. The Saturday surprise "WPP’s position is that it will not be saying anything further about the investigation," said a spokesperson for Buchanan, a WPP-owned PR firm that represents the company's financial operations. "Given the circumstances, there was no 'good outcome' here for WPP," said PR consultant Becky Honeyman, managing partner at New York's SourceCode Communications. "From the perspective of an outside observer, WPP operated very much by the book from the moment the allegations were made public." Honeyman added that there were "clear attempts at transparency during the investigation" as evidenced "by sharing client and employee communications." But that's where the attempts ended. "The statement, 'the allegation did not involve amounts that are material,' at its conclusion has exposed them to attack from some in the U.K. for a lack of transparency," Honeyman said. Liberal Democrat leader Sir Vince Cable, for example, called on WPP to reveal the specific allegations made against Sorrell. Yet the company has made clear that it does not plan to release any information beyond the fact that the amount of money Sorrell was accused of misusing was "not material." Its PR team also gave the impression of acting strategically to minimize the impact of the news by releasing it just after 5 p.m. ET Saturday (10 p.m. at its London headquarters). Sources with direct knowledge of the matter claim that many within WPP's inner circles either had limited knowledge of the coming bombshell or were kept completely out of the loop. [kickout id="2"] The Buchanan team in London only learned of Sorrell's resignation "when he sent an internal note to WPP personnel," according to the spokesperson, who said the news was distributed to major financial publications at that time due to WPP's "disclosure obligation" as a publicly traded company rather than an attempt to delay or reduce the effect of the announcement. "From my perspective, announcing on a Saturday essentially extended the life of the story, with everyone doubling down on coverage," said one anonymous agency executive who questioned the wisdom of WPP's approach. "I think there is a bit of a lack of clarity around the issue, which just fuels speculation ... every drip of new information leads to more press coverage." Teresa Buyikian, an advertising and PR consultant with more than 20 years of experience in the industry, agreed. "There's now a big question mark where there should be a period at the end of someone's unarguably hugely successful 33-year career," Buyikian said. "The public relations efforts on the matter leave way too much room for speculation and gossip. I have no idea what 'personal misconduct' means, thus it just leaves it up to people's imaginations ... which can be either better or worse than the reality." Moving forward at WPP Some industry veterans said a greater sense of openness would benefit investors and current WPP employees. "Given the various assumptions or guesses surrounding this, I think the company should release more information," said Morningstar analyst Ali Mogharabi. "Some think this was just another move to push Sorrell out. But overall, the board’s decision on providing more information more likely depends on whether the info would help the stock and the shareholders, and possibly relationships with clients." Regarding current employees, the aforementioned anonymous executive scrutinized Sorrell's internal memo, taking particular issue with his written reason for resignation: because "the current disruption we are experiencing is simply putting too much unnecessary pressure on the business, our over 200,000 people and their 500,000 or so dependents." "If I were an employee of WPP, I’m not sure I would read that and feel a ton of comfort," she said. Martin Sorrell will be just fine. Few have expressed concern about the financial future of a 73-year-old man with an estimated net worth of $700 million and no non-compete clause in his contract. But for now, it appears observers around the world will continue to wonder aloud about exactly what he did, and how it ended his career. Adweek reporter Lindsay Rittenhouse contributed to this story.