Print Published 12th Mar 2017, 20:27

Is it time to toughen the rules for share schemes?

As institutional investors line up to attack public companies that they regard as over-generous in rewarding their top executives, inevitably the spotlight falls again on WPP’s chief executive Sir Martin Sorrell.   And yet no-one other than an envious green-eyed monster would question the man’s business achievements.

But that is not the issue.  The question is: why would a founding shareholder need any more shares?

Sir Martin has already accumulated massive wealth and, many would say, deservedly so (see Latest £41.5m share award brings Sorrell’s WPP stake to £385m).  That wealth grows in response to the further improvement in the profits earned by WPP, begging the question: is that not reward enough?  Why dish out even more shares which dilute the interests of other shareholders and perhaps could be more usefully reserved to motivate emerging executives who might, for example, secure the longer term continuity of management?