he time the last of the chocolates have been foraged from the Advent Calendar, or thereabouts, WPP, the giant advertising group run by Sir Martin Sorrell, will very likely have chosen a new chair for the company’s board.
The group, which has had regular spats with shareholders over the scale of its executive pay, has promised the market a new chair any time now and it will be a surprise if it doesn’t get one by the end of the year.
Current chair Philip Lader has been in the role since 2001, which is a good couple of years past the best practice guidelines demanded by corporate governance bodies. They generally don’t see a chair as independent of the chief executive and the rest of the board after nine years, or 10 at best. So the affable Lader, who has been loyal to the end in defending recent pay awards at the group, is seen to be on borrowed time.
The institutional shareholders and analysts have not been jumping up and down about this appointment, and they won’t be, so long as it takes place in good time, and so long as the new chair is a strong one. Sir Martin’s record at the helm of WPP has been so strong that there is not a huge clamour for much boardroom change.
Potential candidates will be wanting to ensure they can get firm visibility of the company, both by having an office within the group’s headquarters and by being able to meet its top managers (with Sir Martin in tow).
For the right candidate, the WPP chair is a great job. But it’s also a demanding one, given that over the past few years the annual general meetings have resulted in substantial votes against management on pay.
The trick will be to persuade shareholders that the new appointment will be a change for the better, not just change for change’s sake.