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| Majority of WPP shareholders oppose executive pay deal | Majority of WPP shareholders oppose executive pay deal |
| (about 14 hours later) | |
| WPP shareholders have voted against the company's executive pay report, which includes a £6.8m deal for chief executive Sir Martin Sorrell, by a majority of 59.5%. | WPP shareholders have voted against the company's executive pay report, which includes a £6.8m deal for chief executive Sir Martin Sorrell, by a majority of 59.5%. |
| The vote was announced at the advertising agency's annual general meeting in Dublin, but is not binding. | The vote was announced at the advertising agency's annual general meeting in Dublin, but is not binding. |
| It comes after a number of shareholder advisory bodies urged members to vote against the deal. | It comes after a number of shareholder advisory bodies urged members to vote against the deal. |
| WPP is the latest firm to suffer investor discontent over executive pay. | WPP is the latest firm to suffer investor discontent over executive pay. |
| The voting result so far is based on the postal votes of WPP's large institutional shareholders. | The voting result so far is based on the postal votes of WPP's large institutional shareholders. |
| Small shareholders attending the AGM in person are now voting at present, but this will have only a very limited effect on the final result. | Small shareholders attending the AGM in person are now voting at present, but this will have only a very limited effect on the final result. |
| Sir Martin Sorrell upped the ante in the debate over his pay by publicly defending it on the basis that his performance merited such a generous package. | Sir Martin Sorrell upped the ante in the debate over his pay by publicly defending it on the basis that his performance merited such a generous package. |
| So the annual meeting took place in the context of this huge row with the company's shareholders. | So the annual meeting took place in the context of this huge row with the company's shareholders. |
| But in Dublin's Convention Centre you would have been forgiven for missing this context had you not read the financial press in recent days. | But in Dublin's Convention Centre you would have been forgiven for missing this context had you not read the financial press in recent days. |
| In his presentation Sir Martin never once mentioned the "P" issue, but did a not-so-subtle job of justifying his pay nonetheless with a convincing argument about WPP's performance. | In his presentation Sir Martin never once mentioned the "P" issue, but did a not-so-subtle job of justifying his pay nonetheless with a convincing argument about WPP's performance. |
| There were no fireworks from the floor. The only shareholder to ask a question politely inquired if the board had simply ignored warnings from last year's shareholder vote. | There were no fireworks from the floor. The only shareholder to ask a question politely inquired if the board had simply ignored warnings from last year's shareholder vote. |
| The answer from the man who authorised the pay rise suggested an element of contrition - the board promised to keep in continuous engagement with shareholders going forward. | The answer from the man who authorised the pay rise suggested an element of contrition - the board promised to keep in continuous engagement with shareholders going forward. |
| The message from shareholders was received. There's no backtracking but it appears the board will try to avoid a similar row next year. | The message from shareholders was received. There's no backtracking but it appears the board will try to avoid a similar row next year. |
| 'More engagement' | 'More engagement' |
| Shareholder advisory body Pirc was one organisation that urged members to vote against the deal, citing concerns over its "excessiveness". | Shareholder advisory body Pirc was one organisation that urged members to vote against the deal, citing concerns over its "excessiveness". |
| Pirc and other bodies highlighted the fact that Sir Martin's pay package was 60% higher than a year earlier. | Pirc and other bodies highlighted the fact that Sir Martin's pay package was 60% higher than a year earlier. |
| The BBC's Northern Ireland business correspondent, Jim Fitzpatrick, who was at WPP's AGM, said its shareholders had "delivered a message". | The BBC's Northern Ireland business correspondent, Jim Fitzpatrick, who was at WPP's AGM, said its shareholders had "delivered a message". |
| He added: "The company justified their remuneration policies but struck a contrite note by promising a more 'continuous' engagement with shareholders." | He added: "The company justified their remuneration policies but struck a contrite note by promising a more 'continuous' engagement with shareholders." |
| Louise Rouse, director of engagement at investment campaigner FairPensions, who also attended the meeting, said: "It is difficult to know whether the WPP board underestimated the level of shareholder anger or simply chose to ignore it." | Louise Rouse, director of engagement at investment campaigner FairPensions, who also attended the meeting, said: "It is difficult to know whether the WPP board underestimated the level of shareholder anger or simply chose to ignore it." |
| However, WPP's chairman Philip Lader, told the AGM that the company took the remuneration report vote "very seriously". | However, WPP's chairman Philip Lader, told the AGM that the company took the remuneration report vote "very seriously". |
| He added: "We'll consult with many share owners and will then move forward in the best interests of our share owners and our business." | He added: "We'll consult with many share owners and will then move forward in the best interests of our share owners and our business." |
| However, BBC business editor Robert Peston believes WPP's board may need to take more drastic action to restore good relations with shareholders: "Normally in these embarrassing circumstances, someone senior would resign from the board, to bring about a structural improvement in the relationship with the owners." | However, BBC business editor Robert Peston believes WPP's board may need to take more drastic action to restore good relations with shareholders: "Normally in these embarrassing circumstances, someone senior would resign from the board, to bring about a structural improvement in the relationship with the owners." |
| But he thinks that Sir Martin is unlikely to go: "Presumably it will have to be one or both of the individuals who set his pay, Mr Rosen and Mr Lader." | But he thinks that Sir Martin is unlikely to go: "Presumably it will have to be one or both of the individuals who set his pay, Mr Rosen and Mr Lader." |
| 'Reward performance' | 'Reward performance' |
| Ahead of the AGM, Sir Martin had defended his pay deal, which comprises a £1.3m salary, a £2m annual bonus and £3m in deferred shares and other benefits. | Ahead of the AGM, Sir Martin had defended his pay deal, which comprises a £1.3m salary, a £2m annual bonus and £3m in deferred shares and other benefits. |
| Sir Martin, who founded WPP in 1985, pointed to the company's £1bn record profit last year, and said he found the controversy over his compensation "deeply disturbing". | Sir Martin, who founded WPP in 1985, pointed to the company's £1bn record profit last year, and said he found the controversy over his compensation "deeply disturbing". |
| Writing in the Financial Times last week Sir Martin said: "WPP has a very independently-minded board and compensation committee, which makes decisions that they believe are in the long-term interests of the company and its shareholders, of which I am one. | Writing in the Financial Times last week Sir Martin said: "WPP has a very independently-minded board and compensation committee, which makes decisions that they believe are in the long-term interests of the company and its shareholders, of which I am one. |
| "The board's compensation decisions are right because they reward performance, not failure, reject options in favour of a long-term incentive scheme with co-investment and five-year performance periods, and are competitively fair against our big US and French competitors, which we consistently outperform." | "The board's compensation decisions are right because they reward performance, not failure, reject options in favour of a long-term incentive scheme with co-investment and five-year performance periods, and are competitively fair against our big US and French competitors, which we consistently outperform." |
| Others companies who have also recently faced shareholder rebellions include Aviva, Trinity Mirror and AstraZeneca - all of whom announced the departures of their chief executives as a result of investor pressure. | Others companies who have also recently faced shareholder rebellions include Aviva, Trinity Mirror and AstraZeneca - all of whom announced the departures of their chief executives as a result of investor pressure. |