AdAge Asks: Whence Agency Groups' Heirs Apparent?

01 June 2005

In the news drought that inevitably follows a holiday weekend, AdAge got ageist on Tuesday, asking (rhetorically) whether succession plans are in place for the current crop of greying chief executives at agency holding companies?

It is not a question most agency chiefs like to hear, let alone answer, conscious perhaps that nothing in this vale of tears - especially their tenure in the hide hotseat - is forever.

Executive sensitivity on this issue is hyper, AdAge citing a WPP Group annual meeting a year or two back when a shareholder had the temerity to raise this thorny question.

"As chairman Philip Lader began to respond, ceo Martin Sorrell cut him off," the magazine reports. "Sorrell gave the investor a withering look and curtly replied that WPP would deal with the situation in due course."

Given that the WPP founder turned sixty in February, commercial prudence suggests that "due course" should be just around the corner. According to AdAge, corporate best practices calls for consideration of a successor to begin three to five years before a ceo's 65th birthday.

Among Sir Martin's counterparts at the other 'big five' agency holding companies, Omnicom Group's John Wren at 52 is still in the babychair - but paradoxically has the best succession plan in place.

Elsewhere, Interpublic Group's Michael Roth and Havas' Alain de Pouzilhac are both 59, while Publicis Groupe's Maurice Levy is 63.

The money-men, upon whom the financial health of most agency groups is dependent, are uneasy at this delicate situation. Says Bear Stearns analyst Alexia Quadrani: "This is an industry where you can have two extremes, with IPG getting its succession planning wrong over and over again while Omnicom is much more consistent, whether it's at a network or the holding company."

As for WPP's hypersensitive knight: "I don't think [Martin Sorrell] has any succession plan, except perhaps an emergency one in case something should happen," opines Numis Securities financial analyst Lorna Tilbian in London.

"He probably takes some inspiration from Ed Meyer [the 78-year-old boss of WPP's recently acquired Grey Global Group], although I don't think [Sorrell] will stay around that long; he's keenly aware of founder's disease. But I don't expect any change this side of 65; he'll probably stick around till he's seventy. He's got more energy than men half his age."

Sorrell, who has three sons, all working at his favorite investment bank Goldman Sachs, remains enigmatic over the 'S'-word: "We do succession planning all the time, and we have plans in place," is all he will concede.

Data sourced from AdAge (USA); additional content by WARC staff