WPP PLC - Annual General Meeting Statement
07 June 2017
My name is Deborah Gilshan and I am a Governance and Stewardship Director at Standard Life Investments. On behalf of our clients, we manage 19 million shares in WPP. This is the third consecutive year that a representative from Standard Life Investments has attended and spoken at the annual meeting in escalation of our stewardship efforts.
As a long term shareowner in WPP, we acknowledge the success that Sir Martin Sorrell and all of the team at the company, past and present, have achieved and the ensuing benefits of that success to our clients.
Critical to that success continuing is an orderly management succession, especially for the role of CEO. This remains the key governance risk to our long term investment in WPP. As another annual meeting passes, the time to address succession for the CEO shortens and the necessity to do so becomes more pressing.
We have been engaging with you and other board members on this issue for a number of years, both individually and in collaboration with fellow share owners.
We recognise that the process of planning succession, and the related disclosures, has improved in recent years, and we trust that our ongoing engagement with you on this issue continues to reinforce the importance of it from a shareowner perspective. We will continue to support you and the Board in your endeavours in this regard.
Unusually, the CEO’s service contract may be terminated by either the Company or Sir Martin without any notice. Given this, we suggest that the Board consider what lead time would be required to ensure an orderly succession and discuss this with Sir Martin. We would like the board to come to an agreement with him that, other things being equal, he will provide sufficient warning to meet this timeframe. In our opinion, this increases the likelihood of a seamless succession as it would allow the Board to execute their succession plans effectively and would reduce further the risk profile of the company.
Mr Chairman, will the Board commit to this?