Sir Martin Sorrell could receive a £44 million ($79.9m; €65.9m) windfall from WPP Group under a controversial stock options scheme proposed to shareholders.

The agency giant has called an extraordinary general meeting for April 7, at which investors will vote on a new incentive plan for senior executives to replace the deal that lapsed at the end of last year.

The proposed scheme is similar to its predecessor. Senior executives will use their own cash to buy shares in the group, then receive rewards according to WPP's performance relative to its nearest rivals.

If all goes well, the value of the share options could be huge. Sorrell will put £9.9m into the group, and could receive up to £44m in return. In total, WPP's nineteen leading executives could take home £112.5m.

The proposals have not gone down well with some investment groups. Pensions Investments Research Consultants, an advisory service for large institutional shareholders, believes the payout is too large and is recommending a vote against the scheme at next week's meeting.

However, the stock options have been endorsed by some important groups, including the National Association of Pension Funds. "The potential rewards are unusually high but they are sort of offset by some other unique elements," said the NAPF.

These "unique elements" include a relatively long payout period of five years and the personal investment by WPP executives.

As well as the NAPF, US advisory group Institutional Shareholder Services is recommending a vote in favour of the plan. The Association of British Insurers, meanwhile, is yet to reach a decision.

Executive pay -- especially that of Sorrell -- has become a thorny issue for WPP. Last year almost half the company's shareholders abstained or voted against the chief executive's contract terms, and he recently responded to the criticism by dropping his three-year rolling contract [WAMN: 02-Mar-04].

Data sourced from:; additional content by WARC staff