Chairman told to quit over Ted Baker scandal
TED Baker’s chairman is facing calls to resign as the fashion chain reels from allegations of harassment against its chief executive.
David Bernstein, 75, is under pressure to step down having failed to take action over claims that founder and boss Ray Kelvin ( picturedright) massaged, kissed, hugged or inappropriately touched members of staff.
Bernstein ( picturedbelow) has been on the fashion chain’s board since 2003 and became chairman in 2013. He was previously chairman of fashion rival French Connection, another company dominated by an all-powerful founder, in that case Stephen Marks.
He has also served as chairman of the Football Association and Manchester City.
Professor Randall Peterson, academic director of the leadership institute at London Business School, said Bernstein should step down from his job at Ted Baker.
‘A good board knows the business and its culture and major players,’ he said. ‘Regardless of Bernstein’s reputation, when you either don’t see or choose to ignore such a problematic event, the time has probably come for him to step down.’
Bernstein has been criticised for lacking authority before.
When he was made chairman of the FA, business tycoon Lord Sugar said he was ‘perfect’ for the job because ‘he never offends anyone and allegedly never makes a decision’. Ted Baker’s shares have fallen by more than 18pc since the allegations against Kelvin emerged, wiping more than £148m off the company’s value and nearly £52m off Kelvin’s own 35pc stake. Kelvin, who turns 63 today, has taken a voluntary leave of absence with chief operating officer Lindsay Page stepping in as interim chief executive. The retailer has recruited law firm Herbert Smith Freehills to carry out an investigation into the claims. But some shareholders are worried that Ted Baker will not succeed without Kelvin who is seen as embodying the brand. One of Ted Baker’s leading investors described the board as ‘weak’ and described Kelvin as ‘the driving creative force at the company’.
Kelvin, who is worth £522m, founded Ted Baker 30 years ago and is still heavily involved in the dayto-day running of the business. He uses Ted Baker as an alterego and the firm’s website describes him as the ‘closest man to Ted’. Laura Foll, a fund manager Janus Henderson Investors, said: ‘I think there is a heightened risk for companies like this where you’ve got the founder who is still the chief executive and he still owns 35pc of the company.’ Peterson said: ‘The founder’s syndrome is a widely understood thing where the person comes to embody the brand and organisation. Fine as long as there are no personal problems as there are here. ‘When that happens the organisation suffers with the people.’