Martin Sorrell

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Sir Martin Sorrell
Martin Sorrell - World Economic Forum Annual Meeting Davos 2010 crop.jpg
Born Martin Sorrell
(1945-02-14) 14 February 1945 (age 69)
London, England
Nationality British
Education Haberdashers' Aske's Boys' School
Christ's College, Cambridge
Harvard University.
Occupation Businessman
Known for Saatchi & Saatchi
WPP Group
Net worth Increase £115 million,
(US$175 million) or more
Spouse(s) Sandra Finestone (m. 1970–2005)
Cristiana Falcone-Sorrell (m. 2008)

Sir Martin Sorrell (born 14 February 1945, London, England) is an English businessman and the chief executive officer of WPP Group. He has served in that role since he started the company.

Early life and education[edit]

Born in London to a Jewish family,[1] whose ancestors came from Russia, Poland and Romania.[2] Sorrell was educated at the independent Haberdashers' Aske's Boys' School then Christ's College, Cambridge, and has an MBA from Harvard University.[3]

Career[edit]

Early career[edit]

He joined Glendinning Associates, and James Gulliver and then worked for sports agent Mark McCormack.[4] He joined Saatchi & Saatchi in 1975, and was group finance director from 1977 until 1984. Often referred to as "the third brother",[5] he designed and carried out many of Saatchi's agency acquisitions. Sorrell undertook this by refining the practice of the ‘earn-out’.

WPP[edit]

In 1985, Sorrell privately invested in Wire and Plastic Products, a British wire shopping basket manufacturer, and joined it full-time as Chief Executive in 1986. He began to acquire "below-the-line" advertising-related companies, purchasing 18 in three years, including in 1987 when he stunned the agency world with a $566 million "hostile" takeover of J. Walter Thompson. Sorrell followed this in 1989 with another dramatic hostile $825 million buy of Ogilvy and Mather. Since 2000, WPP has also acquired two more integrated, global agency networks, Young & Rubicam Brands and Grey.[6]

WPP is regarded as the driving force for the period of consolidation which has been going on within the communications industry for the last ten to fifteen years. His WPP group has amassed the largest media buying group in the world, GroupM. Together with the creative agency networks, JWT, Ogilvy and Mather, Young & Rubicam and Grey, WPP is one of the four major players in the global advertising market.[citation needed]

WPP’s stock price soared and although the company then went through difficult times, during which it was on the verge of collapse, Sorrell’s determination and business acumen brought it around.[citation needed]

WPP has become one of the world's leading communications services and advertising companies valued by the UK stockmarket at £5 billion. With billings of £37 billion and revenues of £7.5 billion, WPP's operating companies provide national, multi-national and global clients with advertising, media investment management, information and consultancy, public relations and public affairs, branding and identity, healthcare communications, direct, digital, promotion and relationship marketing, and specialist communications services. WPP employs 140,000 people in 2,400 offices in 107 countries. He owns a substantial stake in the company through a series of pay awards and his own purchases of shares. Until recently he had never before sold shares in the company; his shares are worth around £70 million.[citation needed]

Sorrell himself is widely respected throughout the advertising industry, with his words being scrutinised and quoted by many within the marketing sector. He had articulated in 1996 how interactive media—including the internet—could transform the way we build brands and communicate to consumers in a November 1996 Harvard Business Review article, "The Future of Interactive Marketing".[7] Many industry observers credit him with the fact that the UK still has an independent, vibrant communications industry. His famed remark that the advertising recession in the early part of this decade was "bath shaped" was one of the most repeated quotes in the 2003 – 2004 period.

On 18 November 2008, WPP technically re-incorporated itself as an offshore entity in Jersey (Jersey is considered as a fiscal paradise by the OECD) in order to reduce an annual tax bill of more than £200million.[8]

Other interests[edit]

Martin Sorrell in 2008

In 1997, he was appointed an Ambassador for British Business by the Foreign and Commonwealth Office and subsequently appointed to the Office's Panel 2000 aimed at rebranding Britain abroad. In 1999 he was appointed by the Secretary of State for Education and Employment to serve on the Council for Excellence in Management and Leadership.

He is a Governor of London Business School, and a member of the Advisory Boards of both the Judge Business School in Cambridge, UK and IESE in Spain. He is also Chairman of the Global Advisory Board of the Centre for International Business and Management (CIBAM), at the University of Cambridge, UK.[9] In 1998, he was appointed to the Board of Directors of Associates of Harvard Business School and to the Board of the Indian School of Business.[6]

On behalf of NYC Mayor Michael R. Bloomberg, he chaired Media.NYC.2020,[10] which reviewed the future of the global media industry, the implications for NYC, and suggested actionable next steps for the NYC government.

Criticism[edit]

In 2005 Sorrell sold £9m of shares in WPP at the end of a restricted stock holding period. He also agreed to change a contract with the company which had been much criticised by institutional shareholders in WPP as being unfairly written in Sorrell's favour. Under the previous agreement if Sorrell had been terminated, it would have led to a very large payout; the new agreement provides him instead with no termination payment.

In 2005 his pay was £2.42 million including cash and bonuses.[11] Further he exercised £52 million in share options, is entitled to a further £5.8million in stock, and deferred further options on another 2.65 million shares valued at £15 million until 2008.[12] In 2011 Sorrell's pay package increased by 70% to £4.5 million after WPP's pre-tax profits rose 28%.[13] In October 2011 Sorrell went on the BBC to defend large increases in his and other CEO pay packages[14] at a time when real average wages in the Western world are declining.[15][16]

Shareholders have criticised aspects of corporate governance at WPP. This came to the fore again in 2006 with the advent of two court cases revolving around alleged corruption in an Italian subsidiary and contract disputes with the US launch of the OK! magazine.

In June 2008 WPP drew strong criticism for the involvement of an agency, 'Imago', in which WPP's Y&R subsidiary held a minority interest, with the ZANU-PF presidential campaign in Zimbabwe. A report by the Financial Times[17] found out that Imago was employed by Robert Mugabe's campaign for reelection to the presidency of Zimbabwe. WPP subsequently divested Y&R's minority interests in Zimbabwe.

Recognition[edit]

He was knighted in the 2000 New Year Honours.[18]

On 27 September 2007, Sorrell was awarded the Harvard Business School’s highest honour, the Alumni Achievement Award, by Dean Jay O. Light. The award was also given to: Ayala Corp. chair Jaime Augusto Zobel de Ayala, A. Malachi Mixon of Invacare, Donna Dubinsky and Hansjorg Wyss of Synthes.[19]

Personal life[edit]

Sorrell is married to Cristiana Falcone, Media & Entertainment Industries Director at the World Economic Forum.[20]

Sorrell was previously married to Sandra, with whom he has three sons, but the marriage broke down in 2003. In October 2005, Sorrell cashed in £12 million of shares in WPP to satisfy paying their £30 million divorce settlement,[21] where represented by Nicholas Mostyn QC she was awarded: a £3.25m Georgian townhouse; two Harrods underground car parking spaces worth £200,000; £2m in bank deposits; £23.4m in cash; plus stocks and shares.[22]

Despite the divorce settlement, Sorrell still had 13 million shares an estimated £80m valued stake in WPP at the time of the divorce, which represented around 1% of the company, plus his 2005 pay settlement award.

References[edit]

  1. ^ "Top Jewish earners". Somethingjewish.co.uk. Retrieved 19 April 2011. 
  2. ^ "The other side of Sir Martin Sorrell". Campaign India. 10 November 2009. Retrieved 26 April 2010. 
  3. ^ Benjamin, Todd (16 December 2005). "Martin Sorrell: Persistence and determination". CNN International. Retrieved 26 October 2010. 
  4. ^ Reece, Damian (26 March 2005). "The Interview: Celebrating 60 and two decades of worldwide growth – Business Analysis & Features, Business – Independent.co.uk". The Independent (UK). Retrieved 19 April 2011. 
  5. ^ "Ad Age Advertising Century: People: Martin Sorrell". Advertising Age. Retrieved 19 April 2011. 
  6. ^ a b "Sir Martin Sorrell Biography from speakerideas.com". Retrieved 1 October 2012. 
  7. ^ (November, 1996)."The Future of Interactive Marketing". Harvard Business Review
  8. ^ Simon Duke (24 January 2009). "City tycoon Martin Sorrell ‘used £45million in shares to pay for divorce'". Daily Mail (UK). Retrieved 19 April 2011. 
  9. ^ http://www.jbs.cam.ac.uk/research/centres/cibam/index.html
  10. ^ Strauss, Steven; Kristy Sundjaja; Peter Robinson; Andrew Chen (2012). Media.NYC.2020. NYCEDC. 
  11. ^ Paul Murphy (4 June 2005). "Martin Sorrell piles up £50m of WPP shares in nine months | Business". The Guardian (UK). Retrieved 19 April 2011. 
  12. ^ Snoddy, Raymond (2 January 2006). "Sir Martin Sorrell: Full of Eastern promise". The Independent (UK). Retrieved 19 April 2011. 
  13. ^ Sweney, Mark (28 April 2011). "Sir Martin Sorrell's pay rises to £4.5m". The Guardian (London). Retrieved 28 October 2011. 
  14. ^ Martin Sorrell (28 October 2011). Sir Martin Sorrell defends top pay. British Broadcasting Corporation. 
  15. ^ "Week 42, 2011: UK Real Average Wage". Economic Research Council. 21 October 2011. Retrieved 28 October 2011. 
  16. ^ Mandel, Michael (3 November 2008). "Real Wages Continue to Fall". Business Week. Retrieved 28 October 2011. 
  17. ^ "/ UK – Campaign link forces WPP sale". Financial Times. 20 June 2008. Retrieved 19 April 2011. 
  18. ^ http://www.theguardian.com/media/2008/jul/14/mediatop100200811
  19. ^ Abs-Cbn Interactive, JAZA receives Harvard alumni award[dead link]
  20. ^ http://www.managementtoday.co.uk/features/1161352/sir-martin-sorrell-losing-something-gets-me/
  21. ^ http://www.brandrepublic.com/bulletins/br/article/533574/divorce-forces-sorrell-cash-12m-wpp-shares/
  22. ^ Hamilton, Fiona. The Times (London) http://www.women.timesonline.co.uk/article/0,,17909-1839970,00.html |url= missing title (help). 

External links[edit]