New York-based Russell Reynolds hired to aid search as ad firm tries to steady ship following departure.

WPP has hired a New York-based recruitment firm as it begins the global search to replace founder and chief executive Sir Martin Sorrell.

Russell Reynolds, a top five global executive search firm, is understood to be working with Frances Illingworth, WPP’s global head of recruitment.

The move to bring in an external executive search firm is extremely rare for WPP, which traditionally handles most of its executive recruitment in-house.

Sorrell’s departure from WPP has prompted the leading ratings agency Moody’s to downgrade its outlook for the group, citing concerns including a breakup, the loss of clients and its poor performance compared with rivals.

The downgrade, from “stable” to “negative”, comes as WPP’s 11-strong board was set to meet on Tuesday with the task of finding Sorrell’s successor high on the agenda.

“In Moody’s view, the high-profile departure of Sir Martin Sorrell raises concerns over the future strategy and shape of the group, increases client-retention risk and could hence hinder WPP’s ability to meet its 2018 guidance,” said Christian Azz, Moody’s assistant vice-president.

WPP issued a number of warnings about growth last year on its way to reporting its worst financial year since the 2009 recession. It has also seen its market value slashed by a third. It lost almost 7% on Monday alone as jittery investors worried about its future without its founder as ad clients cut back their budgets and reconsider their spending strategies.

“Sir Martin Sorrell’s resignation comes at a time when the company is already facing a number of operational challenges and introduces uncertainty over the strategy and ultimately the structure of the group going forward,” said Azzi.

Moody’s said that WPP was already weakly positioned before Sorrell’s departure, performing significantly below its peers such as the US groups Omincom and IPG and the French firm Publicis.

WPP’s board meeting, the first not to include its founder and chief executive in years, was expected to include Mark Read and Andrew Scott, the senior executives promoted to run the company day-to-day during the search for a new chief executive. They are also considered the two leading internal candidates.

The board member Sol Trujillo, a former chief of companies including the French telecoms firm Orange and Australia’s Telstra, is understood to have been one of the most vocal about the issue of succession at WPP.

A number of names have emerged as potential runners and riders to succeed Sorrell, including the chief executive of the publishing and exhibitions group Informa, Stephen Carter, who has worked at Ofcom, the cable firm NTL and WPP’s ad agency JWT; Adam Crozier, whose pedigree includes running ITV, the Royal Mail, the Football Association and Saatchi & Saatchi; the Sky chief executive, Jeremy Darroch, and Andrew Robertson, the chief executive of Omnicom’s global BBDO ad network.

Sorrell has said he was available to assist with the transition.

The 73-year old has “unreservedly denied” misconduct allegations and WPP’s board has said it would not be publishing the outcome of the investigations into them by an independent law firm.

The influential shareholder advisory firm Glass Lewis said it would prefer WPP to publish the report but that it accepted this was unlikely to happen.

“In the interests of transparency, we would prefer if the report was made available to shareholders, though we view that outcome as unlikely,” said Martin Mortell, Glass Lewis UK & Europe’s director of research. “Some investors may be willing to forego transparency in lieu of achieving overdue change at the top and the opportunity of a new strategic vision.”

Sir Vince Cable, the Liberal Democrat leader, has said there was a “real lack of transparency” and “any investigations done by the company should be made public”.

The company said it had concluded the investigation and had no further comment to make.

WPP’s share price moved up almost 2% in trading on Tuesday as market sentiment about the prospects of the advertising giant steadied.