In a statement issued through a communications consultancy working for Sorrell in a "personal capacity", Sorrell describes the allegation as "financial impropriety by me, specifically as to the use of company funds".
"Mark and Andrew and the management team at all levels have the knowledge and abilities to take WPP to even greater heights and capitalize on the geographic and functional opportunities", said Sorrell.
WPP said that the probe had concluded, adding "the allegation did not involve amounts that are material".
"It wasn't a boardroom battle but the way they behaved in his eyes, the manner they handled the investigation, in the end he thought I'm 73-years old I don't need this s**t", one person close to the process said. However, I believe it is in the best interests of the business if I step down now.
"As a significant share owner, my commitment to the company, which I founded over 30 years ago, remains absolute - to our people, our clients, our shareholders, and all of our many stakeholders", Sorrell said in a statement after the investigation began. Chairman Roberto Quarta becomes executive chairman until the appointment of a new CEO, while Mark Read, who heads WPP agency Wunderman, and Andrew Scott, WPP's corporate development director, become joint chief operating officers.
Despite the misconduct investigation, some commentators said it was the fact that the company had lost a third of its value over the past 12 months - in the face of competition from the likes of Google and Facebook - that cost Sorrell his post.
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But he indicated in a late-afternoon tweet that they both would "fully cooperate with any search for the truth". Attorney Thomas McKay. "And anyone who has ever hired a lawyer a close third", she said.
Born in London, Sorrell studied economics at the University of Cambridge and then gained a masters from Harvard University.
He previously worked at Saatchi & Saatchi, and was knighted in the Queen's New Year honours list in 2000.
Sorrell is one of Britain's best known and highly paid businessmen, pocketing about £230m since 2010.
As the architect of the global empire which began in the humble form of the cash shell Wire and Plastic Products, Sir Martin has amassed rich rewards from his success.
WPP's biggest clients globally include the likes of Ford, Procter & Gamble and Unilever, which it services through traditional advertising agency networks such as Ogilvy, J Walter Thompson and Grey. This means Sorrell will be eligible to receive payouts related to 1.6m shares in a number of award plans that will vest over the next five years.
WPP declined to comment on Saturday evening, while Sir Martin could not be reached for comment.