This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here

NEWS26 May 2009

WPP shareholders split over share incentive scheme

Financials UK

UK— WPP shareholders are split over a new senior executive incentive scheme at the marketing and research group, which is due to be voted on at the firm’s AGM next week.

The scheme gives WPP senior executives who have bought shares in the company the opportunity to receive up to five times as many free shares back – if the firm outperforms its nine major rivals over five years.

The plan has been opposed by the Association of British Insurers, which sent a ‘red top’ warning to members. A spokesman for the association told Research that the note was sent to express “concerns about a remuneration package” and urged members to vote against it next week.

However, Research Recommendations and Electronic Voting, a US analyst firm whose views are based on the policy guidelines of the National Association of Pension Funds, has backed the scheme, pointing out that executives will fund their own purchases and face “a real risk of significant personal loss” if the company does not meet performance goals.

A WPP spokesman said that similar five-year schemes had been in place for the last decade, and that all the firm’s incentive policies are “wholly aligned to shareholders’ interests”.

WPP owns the Kantar group of research agencies, which include TNS, Research International and BMRB.

Follow us on Twitter

@RESEARCH LIVE

0 Comments