Base salary and fees
|Current salary and fees||Effective date|
|Sir Martin Sorrell||£1,000,000||1 Jan 2007|
|Paul Richardson||$830,000 and £100,000||1 Jul 2008|
|Mark Read||£325,000||1 Jan 2009|
Fees are paid to executive directors in respect of their directorships of WPP plc. Base salaries and fees for the senior people at WPP are normally reviewed every 24 months. When salaries are reviewed this is done so within the context of:
- total compensation;
- the current mix of fixed and variable compensation;
- the performance of the relevant business unit;
- pay and employment conditions elsewhere in the Group; and
- general market conditions.
In determining suitable benchmarks the committee looks at similar roles in competitor organisations and, if appropriate, general industry data for organisations of comparable size and complexity.
Sir Martin Sorrell’s base salary was last increased on 1 January 2007 (and prior to that on 1 September 1999). Although he was due a review in 2008, he informed the committee that an increase would not be appropriate in light of current business conditions. His compensation package therefore remains unchanged.
As reported last year, Paul Richardson’s base salary was reviewed during 2007 and an increase from £450,000 to £500,000 effective 1 July 2007 was approved. This was over four years from his previous increase. It was also agreed that an additional increase of £50,000 would be considered effective 1 July 2008 depending on a further review at that time. The committee considered that the revised base salary of £550,000 appropriately positioned him relative to both the FTSE 100 and WPP’s closest industry competitors. Since December 2008, Mr Richardson has been entitled to annual fees of £100,000 in respect of his directorship of WPP plc, and his base salary became £450,000 at that time. Effective 1 January 2009, the committee changed Mr Richardson's base salary to $830,000 as Mr Richardson is now based in the US; his £100,000 fee remains unchanged. This change was designed to protect Mr Richardson from the exchange rate variations that have been very volatile. His base salary was calculated using an exchange rate of $1.85 to £1 (which was the exchange rate used by the Company for the purposes of its accounts during 2008, as detailed in the Consolidated income statement) and subsequently cross-checked against appropriate US benchmarks to ensure that it did not result in his remuneration exceeding those benchmarks. Mr Richardson’s next regular review will not be before July 2010.
Mark Read’s base salary was last increased on 1 January 2007. As with Sir Martin Sorrell and Paul Richardson, Mark Read became entitled to fees of £100,000 in respect of his directorship of WPP plc. His base salary at that time became £175,000. When reviewing his compensation the committee felt that his base salary and fees were considerably below the median for his role and position as a director of the company. Since his appointment to the Board in 2005, Mr Read had grown substantially both in experience and in strategic importance. It was therefore felt that an increase in his base salary from £175,000 to £225,000 was justified. The implementation of this increase was, however, deferred until 1 January 2009. The £100,000 fee remains unchanged.
Salary increases throughout the Group in 2009 will be authorised on a performance and competitive basis.