Information surrounding the allegations remain scarce, but the advertising giant's board has brought in an independent counsel to carry out an investigation into the accusations, according to the Wall Street Journal.
AJ Bell argues that WPP (LON:WPP) faces a succession issue regardless of the outcome of an investigation into chief executive Martin Sorrell over alleged personal misconduct, Citywire reports. The British ad agency added that the investigation is ongoing.
Sorrell did not immediately respond to a request for comment.
In a statement issued by Project Associates on behalf of Sir Martin, he rejected the allegation of financial impropriety - but said he understood the company had to investigate it.
"Obviously, I shall play no part in the management of the investigation underway", he said.
The company has hired U.S. law firm Wilmerhale to look into claims against one of the top advertising gurus.
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News of the investigation has sent WPP's already flailing stock to its lowest in nearly five years.
Sir Martin denies any wrongdoing.
In 1985, Sorrell invested in a manufacturing company called Wire & Plastic Products plc.
Sorrell built London-based WPP from an investment in a shopping-basket manufacturer into the owner of blue-chip agencies. Credit Suisse Group dropped their price objective on shares of WPP from GBX 1,440 ($20.21) to GBX 1,400 ($19.65) and set a "neutral" rating for the company in a report on Friday, March 2nd. An under pressure CEO's biggest ally is a strong share price and at the moment WPP's isn't.
The company said 2018 would be flat and that long-term earnings growth will be as little as 5 per cent and twice that at best, compared with a prediction of as much as 15 per cent previously.
During the past five years Sorrell whose PR businesses in Australia are struggling to grow has been paid over $350M dollars during the past five years. On Wednesday morning, shares in WPP opened 2.8 percent lower in London. Sorrell has never given any indication that he may be ready to step back.