Investors warned by ABI about £112.5m WPP pay deal

LONDON - WPP Group faces shareholder rebellion over its five-year £112.5m pay plan after the Association of British Insurers warned members about the scheme.

The ABI has issued what is known as a "red top" warning, its most serious alert, to let members know that there is a serious potential issue.

In this case there are worries about WPP's five-year incentive pay plan, which could see chief executive Sir Martin Sorrell walk away with £44m and lead to £112.5m being paid to WPP's 19 top executives.

The ABI is concerned that the new scheme was introduced too quickly and without adequate dialogue with the company's shareholders.

Peter Montagnon, head of investment affairs at the ABI, told The Guardian: "There is very serious opposition out there. And we would suggest that the company consider its position with regard to this scheme. The ball is very much in its court."

ABI does not, howeer, advise its members which way to vote and said that it will be talking to WPP about the issues. Last week another body that campaigns on corporate governance, Pensions Investments Research Consultants, urged WPP investors to block the proposal at next week's shareholder meeting.

Sir Martin has already bowed to shareholder pressure about his three-year contract with the advertising giant, which is now to be shortened.

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