Maurice Saatchi and three independent directors have resigned M&C Saatchi as an accounting scandal rocks the London-based shop.
The resignations stem from disagreements over how the firm, the go-to shop for Britain’s Conservative party, should reorganize its corporate governance following the disclosure of incorrect statements on revenue and costs.
According to the Financial Times, much of the controversy centered around whether or not David Kershaw, who has been CEO at the firm for the past five years, should stay on.
An external review by PricewaterhouseCoopers found the problems were more extensive than previously thought and reduced its profit forecast, causing shares in the firm to drop.
The independent directors who resigned are Tory peer Michael Dobbs, former private secretary to Prince Charles Michael Peat and investment banker Lorna Tilbian.
The resignations point to "how contentious the process of restoring trust in M&C management has become within the company," according to the FT.
Saatchi has been executive director of M&C Saatchi since he founded it with his brother Charles in 1995 after being ousted from Saatchi & Saatchi. He retains a 4.5 percent stake in the company.