Sports firm on a sticky wicket
Investors order retail giant to clean up its act
SPORTS Direct has been told it must make major changes to the way it is run.
A powerful group of investors yesterday demanded a root-and-branch review after criticism of the company’s management and working practices.
The shareholders calling for an independent probe own 12% of the group.
The 12 shareholders, through a body called The Investor Forum, have been trying to persuade Sports Direct to make changes during eight behind-the-scenes meetings with bosses since July last year.
But The Investor Forum yesterday went public with its concerns, ahead of Sports Direct’s AGM on September 7.
Andy Griffiths, executive director of the Forum, said: “We do not take this step lightly.” Billionaire Sports Direct founder Mike Ashley has pledged to improve conditions for workers at its Shirebrook depot in Derbyshire.
Sports Direct has also asked a law firm, RPC, to look at its employment practices. But the Forum’s shareholders, including Aviva Investors, Standard Life Investments, Fidelity and Legal & General Investment Management, are concerned that RPC already has dealings with the retailer.
Meanwhile, Legal & General, Sports Direct’s 11th largest investor, revealed it would stage a revolt at the AGM.
It vowed to vote against the reelection of Sports Direct chairman Keith Hellawell, a former police chief constable. Sports Direct tried to tackle criticism by this week announcing an open day for the public on the day of its AGM. Unite assistant general secretary Steve Turner said: “Sports Direct has achieved a rare feat in uniting the City, politicians and Unite in the need to address deep-seated problems with its work practices and governance. “The only way the Sports Direct board will begin to restore confidence is by confronting the endemic abuses within its employment agencies by moving long-standing agency workers on to direct, permanent contracts and weaning itself off zerohours contracts.”