3 Executives Quit Saatchi After Co-Founder Is Pushed Out : Advertising: The company names two new board members. But observers say resignations are a devastating blow.
Saatchi & Saatchi suffered a major blow Monday as three top executives quit only a week after Maurice Saatchi was forced out as chairman of the giant advertising firm he co-founded.
Saatchi & Saatchi, whose results have fallen in recent years, said it would have no problem replacing the departing executives and immediately named two new board members.
Those leaving were acting Chairman Jeremy Sinclair, who resigned effective immediately along with Bill Muirhead, chief executive of Saatchi & Saatchi North America, and David Kershaw, chairman and chief executive of Saatchi & Saatchi Advertising UK.
The three attacked the influence of David Herro of Chicago-based fund manager Harris Associates, the force behind the ousting of Maurice Saatchi from the company he founded in the 1970s with brother Charles Saatchi.
“I no longer feel that the people who control our company understand what we really do,” Muirhead said in his resignation letter, printed by London’s Evening Standard newspaper along with those of Kershaw and Sinclair.
“I now feel totally compromised by Mr. Herro and the board’s decision (to oust Maurice Saatchi), particularly as it was against the express wishes of several of our clients, including a number I am personally close to,” Muirhead’s letter says.
Maurice Saatchi severed all links with the group last Tuesday after refusing a new, lesser role as joint president along with his brother, and the chairmanship of the Saatchi & Saatchi Advertising Worldwide operating subsidiary.
Saatchi said it will hold the three departing executives to the notice terms of their contracts, which would keep them at the group for at least 12 months.
It also named two new board members, Michael Bungey and Ed Wax, and said group Chief Executive Charlie Scott will take over as acting chairman.
A Saatchi spokesman said Bungey and Wax were appointed because they had had regular contact with clients.
“We are disappointed by the departure, but there are other people in the management structure that worked with these people and can fill in the gaps they have created,” the spokesman said.
But Dominic Mills, editor of the advertising industry magazine Campaign, said the departure of the three is devastating for Saatchi.