Sports Direct has apologised for “serious shortcomings identified in working practices” at its Shirebrook warehouse, following publication of a report into its working practices by Reynolds Porter Chamberlain, who are legal advisers to the company.
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The AGM has been told that Mr Hellawell – a former government drugs’ tsar and chief constable of West Yorkshire – would quit next year if he failed to win significant support from investors.
The annual general meeting of Sports Direct shareholders lasted almost two hours and saw Mike Ashley angrily hitting out at the trade union Unite and looking glum for the majority of the meeting as the company’s working practices came under further scrutiny.
Mr Hellawell’s words at the AGM did nothing to appease Standard Life Investments, the firm’s second largest shareholder.
In a bid to prove to assembled reporters that he was all too aware of Sports Direct employees’ daily ordeals, billionaire founder Mike Ashley demonstrated a routine search procedure at the company’s Shirebrook warehouse.
“We would like to see Mr Ashley with a role, title and responsibilities that reflect his influence as majority shareholder and founder of the business”.
Although some institutional shareholders welcomed yesterday’s moves by Sports Direct, they still want an independent report – and the head of company chairman Keith Hellawell.
Nearly 21 per cent of shareholders voted for an independent review of working practices, despite the company’s own review being published on Tuesday.
After a stinging internal report, the firm promised on Tuesday it would pay staff it directly employs above the minimum wage.
“As Sports Direct expand their outlets across Northern Ireland, Unite will seek to work constructively with management to ensure it stays true to its promise to restore dignity and respect to its workers”.
Under-pressure retailer Sports Direct turned down an offer by its chairman to step down on the eve of today’s (7 August) showdown with investors.
Sports Direct said the changes will only apply to those directly employed by the company.
On Wednesday Sports Direct will allow the public to attend the AGM and a tour of the Shirebrook site.
The firm’s last annual results, for the year to April 24, revealed underlying EBITDA stood at £381.4m, well short of Mr Ashley’s £420m goal meaning workers missed out on bonuses.
Ashley ignored calls for his chairman Keith Hellawell to step down, publicly clashed with one shareholder, angrily accusing her of not being “open and honest”, and accused a representative from trade union Unite of “showboating”.
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It joins a number of asset managers that have called out the retailer on its poor corporate governance, with Royal London Asset Management and Hermes Investment Management this week announcing they would vote against key board appointments.
