Advertising giant WPP accused of neo-colonialism

The board of WPP has been accused of ‘neo-colonialist practices’ by a disgruntled Kenyan entrepreneur, who alleges that the advertising giant engaged in ‘discriminatory’ tactics to oust him from his own business.

Bharat Thakrar, the founder of Scangroup, one of Africa’s largest marketing agencies, has claimed that the FTSE 100 firm discriminated against him and Scangroup’s finance chief Satya Das, breaching Kenyan law and ‘clearly targeted’ executives at the business who were of ‘Indian extraction’.

In a letter from Thakrar’s lawyers seen by The Mail on Sunday, the former Scangroup chief executive also accused the UK-based ad agency of ‘deliberately’ leaking details of an internal investigation into alleged financial and personal misconduct to local media and causing him ‘reputational damage’.

‘The disciplinary proceedings were in any event discriminatory and amounted to neo-colonialist practices as they were clearly targeted only at our client who is of Indian extraction,’ the letter read.

Thakrar’s lawyers added that WPP had protected a non-Asian high ranking Scangroup executive involved in the affair, who went on to work for another business under the group’s umbrella. Several other WPP employees have also been named as part of the claim.

WPP denies the allegations. A spokesman said: ‘Bharat resigned from WPP-Scangroup in 2021 following allegations of impropriety between 2014 and 2018.’

Thakrar set up the business that would become Scangroup in 1982 and WPP invested into the business with a 23 per cent holding in 2009 before acquiring a controlling stake in 2013.

Today, WPP owns 56 per cent of the business while Thakrar retains a 10.5 per cent stake.

But the former boss alleges that the ad giant ‘manipulated itself into a position to control the board of Scangroup’ before making allegations against him in an attempt to force his eventual resignation in March 2021.

Thakrar is understood to be seeking damages in the region of £24 million and is preparing to file proceedings within weeks, according to a person familiar with the matter.

The allegations could become another headache for WPP after an executive from its GroupM media agency in China was detained by police on bribery charges. WPP fired the executive in October.

WPP’s reputation had already taken a blow in 2018 when its founder Sir Martin Sorrell resigned following allegations of misconduct. 

The group is also struggling to boost its fortunes amid a downturn in demand for advertising that has pushed its share price down 23 per cent over the past 12 months.

Last month, the group unveiled plans to plough £250 million into artificial intelligence this year and upgraded its medium-term financial targets on the back of a cost-cutting programme that is aiming to save hundreds of millions of pounds.

The firm is also mulling whether to offload its 40 per cent stake in market research outfit Kantar, which it is expected could raise billions of pounds.

It followed a disappointing third-quarter trading update when WPP issued a second consecutive profit warning in as many quarters, blaming a downturn in client spending in the US and China.

WPP’s sluggish share price performance has also sparked speculation that it could become a takeover target, with US private equity groups Blackstone and Silver Lake thought to be among the interested parties.