Contact O'Dwyer's: 271 Madison Ave., #600, New York, NY 10016; Tel: 212/679-2471; Fax: 212/683-2750
 
ODWYERPR.COM > Top Story return to main page

March 6, 2003
WPP DROPS OUT
OF INDUSTRY RANKINGS
 

The WPP Group, citing the scores of different ad/PR industry rankings and the different rules for each, said it will not supply data on its PR, advertising and other subsidiaries this year.

Howard Paster, executive VP of the WPP Group, owner of Hill and Knowlton, Burson-Marsteller, Ogilvy PR Worldwide, Cohn & Wolfe and other PR firms, said the strict disclosure rules of Sarbanes-Oxley, passed last year and to be implemented starting March 31, make it dangerous to provide different numbers to all the different rankings.

Kathy Cripps, president of the Council of PR Firms, an association of 120 PR firms largely funded by the top 20, said that WPP, Interpublic, Omnicom, Grey (GCI Group), and Publicis told her March 3 they will only supply overall totals for categories such as advertising and PR.

March 3 was the deadline for entries in the Council's annual ranking of PR operations and returns had not been received from holding company PR units.

Cripps said she extended the deadline to March 7 in hopes the holding companies might change their minds but they did not.

Havas, owner of Magnet Communications, has not yet informed the CPRF of any decision in this matter.

Cripps said the CPRF will provide the PR totals which the holding companies disclose as part of their regular financial reports.

She said the inability of the many PR brands owned by the holding companies to report their numbers creates a problem for them.

She spoke to lawyers on the issue who told her that Sarbanes-Oxley lacked "clarity" in the matter of holding companies disclosing the results of their subsidiaries.

IPG Cites "Reporting Environment"

Philippe Krakowsky, senior VP-PR at Interpublic, said the new policy is the result of the "current reporting environment."

Different publications have their own reporting rules and they don't conform to GAAP (generally accepted accounting principles), he said.

Also, he noted, GAAP rules differ from country to country.

Key Interpublic units are Weber Shandwick Worldwide and Golin/Harris International. Omnicom units affected include Fleishman-Hillard, Ketchum, Porter Novelli and Brodeur.

WPP lawyers and executives discussed the matter "vigorously" and at length and have come to the firm conclusion that WPP could be in violation of the new law, said Paster.

This policy would make it hard for many trade publications such as Advertising Age and AdWeek to assemble their annual rankings. They are now in the process of gathering this information.

Paster, formerly chairman and CEO of H&K, said that WPP normally would compile statistics in numerous areas such as advertising, PR, sales promotion, direct mail, and media buying for each of its many agencies for trade publications in a dozen or more countries.

The gathering of such information, under different rules, including filling out forms that run to ten and more pages, had become a major task of WPP agency executives, he noted.

WPP ad agencies include J. Walter Thompson and Ogilvy Worldwide.

The ad agency conglomerates as well as their many subsidiaries had a difficult year in 2002. The year is being described as the worst downturn in advertising/PR in 50 years.

 
E-mail to a friend
Tell O'Dwyer's what you think
(Responses should include your name and affiliation, which will be withheld at writer's request)

Responses:
 
Been there, done that... (3/06):
It's not the duty of ad/PR conglomerates to provide fodder for the trades or fill out their ranking charts. Tough.

But you can bet that if the numbers were better, they wouldn't be fingering their worry beads over Sarbanes-Oxley and would be trumpeting their growth and market share! This is convenient and somewhat disingenuous cover for disastrous business results.

Wait a minute (3/06):
Aren't these the same companies that have set up disclosure and S-A Act units to bring in biz. If they don't understand or can't follow the law how are they supposed to advise their clients about it?????


 

Editorial Contacts | Order O'Dwyer Publications | Site Map

Copyright © 1998-2020 J.R. O'Dwyer Company, Inc.
271 Madison Ave., #600, New York, NY 10016; Tel: 212/679-2471