Business

Mike Ashley faces shareholder revolt at Sports Direct agm

Two advisory groups call on shareholders to oppose re-election of group founder along with chairman and another director

The current row comes three weeks after Mike Ashley’s sportswear group snapped up the department store chain House of Fraser for £90 million. File photograph: Joe Giddens/PA Wire

Mon Sep 3 2018 - 16:59

Mike Ashley faces a potential shareholder revolt at Sports Direct's annual meeting on Wednesday amid claims of his "continued failures" as chief executive of the sportswear company, including a proposed multimillion-pound payment to his daughter's fiancé.

Two shareholder advisory groups are urging investors to vote against the re-election of Mr Ashley and the company's chairman, Keith Hellawell, over the retailer's poor treatment of employees and alleged poor governance.

The row comes three weeks after Ashley’s sportswear group snapped up the department store chain House of Fraser for £90 million. Mr Ashley is in talks with landlords over how many of House of Fraser’s 59 outlets will close. He also owns the Heatons chain in Ireland and has a 28 per cent stake in Debenham’s.

In a voting advice, Pensions & Investment Research Consultants (Pirc) said governance worries included “the excessive influence of Mike Ashley over the board and the running of the company”, and the fact there were no female directors on the board, which was “not acceptable”. It also claimed that the board had “consistently failed” to deal with concerns about employment practices that were the subject of a scathing MPs’ report in 2016, which branded conditions as those akin to a “Victorian workhouse”.

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Criticised

A second advisory group, Institutional Shareholder Services (ISS), said there were "ongoing operational, governance and risk oversight concerns", and it criticised the company's "apparent unwillingness" to address the worries of independent shareholders.

Both shareholder advisory groups are recommending that Sports Direct investors also oppose the re-election of the non-executive director Simon Bentley, who is chairman of Sports Direct's audit committee.

A spokesperson for Sports Direct said: “We hope shareholders will continue to recognise the further positive progress that we have made over the last 12 months.” – Guardian

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