Sir Martin Sorrell is bringing the curtain down on a 32-year career as chief executive of WPP Group, the marketing services giant, weeks after its board launched a probe into an allegation of improper personal conduct.
In a statement, he said it was "in the best interests of the business if I step down now". They have not said whether allegations were put to Sorrell resulting in his resignation. "However, I believe it is in the best interests of the business ...in your interest, in the interest of our clients, in the interest of all shareowners, both big and small, and in the interest of all our other stakeholders, it is best for me to step aside....the current disruption is putting too much unnecessary pressure on the business".
The 73-year-old said on Saturday he was standing down, departing at a crucial time for WPP which has seen its share price fall 30 percent this year due to lower client spending, contract losses and a growing threat from Google and Facebook.
"Yes he was relentless and richly rewarded - but let's not forget Sir Martin Sorrell built a global advertising empire from nothing", said Lionel Barber, editor of the Financial Times newspaper. Meanwhile, CEO of Wunderman and WPP Digital, Mark Read, as well as WPP corporate development director and COO, Europe, Andrew Scott, have been appointed as joint COOs of WPP. "It has been a passion, focus and source of energy for so long", stated Sorrell in an emotional note to WPP staff.
But Sorrell's future with the company has been in peril since earlier this month when the firm started investigating the chief exec for misuse of funds and "personal misconduct".
Roberto Quarta described Sir Martin as being the "driving force" behind WPP's growth and thanked him for his commitment to the business.
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Brian Wieser, advertising analyst at Pivotal Research, said WPP had the right assets but it had not packaged them properly in recent years and the fact it was more fragmented than Omnicom (OMC.N) and Publicis meant it was now harder to reposition.
"We have weathered hard storms in the past".
He said that he leaves the company in "very good hands", with Read, Scott and the management team at all levels having the knowledge and abilities to take WPP to "even greater heights, as well as capitalise on the geographic and functional opportunities".
Sorrell told staff that WPP had come through hard times before and would do so again, saying he would be available to anyone who wanted advice. "And our highly talented people have always won through, always", said Sorrell.
"In the coming period, I will be available to the Board and any of you, should you want help with anything, anywhere".
As some of you know, my family has expanded recently, WPP will always be my baby too. "Good fortune and Godspeed to all of you".