FTSE’s most surprising chairman
… but being a top cop gave Keith Hellawell skills to run large firms
HE’S the former coal miner-turned-police chief, which makes for a very unconventional FTSE 100 chairman. Keith Hellawell, who took the helm of retail giant Sport Direct six years ago, seems to thrive on controversy.
As a top cop he managed to get Yorkshire Ripper Peter Sutcliffe to admit to two more attacks, and as Tony Blair’s drugs czar he resigned over the weakening of the classification of cannabis.
At Sports Direct he has been responsible for keeping founder and executive deputy chairman, Mike Ashley, in line, while ensuring the firm adheres to the very best practice expected of a London stock marketlisted firm.
However, the City, and even politicians, have questioned his effectiveness amid allegations about working conditions at the firm’s warehouses, executive pay, and concerns about corporate governance.
Hellawell was re-elected as chairman at Sports Direct’s annual meeting last week despite 28.6pc of those independent shareholders who voted refusing to back him. He is aghast at any misapprehension Ashley might need to be reined in.
‘As a policeman I’ve controlled people from serial killers to rapists and Mike Ashley doesn’t need controlling,’ he says.
‘When you say “bring to task” it sounds like some recalcitrant individual. I don’t like the words as it sounds like he needs to be held to account. I’m genuinely at a loss as this is not a conflict situation. His interests are aligned with the company.’
Fresh from the firm’s AGM at its Shirebrook headquarters and warehouse in the heart of the Derbyshire countryside the Footsie chairman has hot-footed it down to a café in London’s St Pancras station on route to the airport. He is due to meet his wife, Bren, in the South of France that evening for his main summer holiday.
Hellawell strikes an imposing figure with his rugby player- sized frame and silver-brushed locks. A pin- striped suit with a navy print tie, sporting replications of an indistinguishable fish, shriek more City gent than PC Plod.
BUT it has been a difficult day for him. One institutional shareholder, Royal London Asset Management, which owns about £8.3m of Sports Direct shares, launched an attack ahead of the meeting. It said: ‘We have lost confidence in the board and are concerned about the long list of corporate governance failings that haven’t been addressed.’
Hellawell says: ‘It is disappointing. Clearly I will speak to them and deal with the issues raised and reassure them we are operating in a professional manner.’
On the vote for his re-election as chairman he takes a different view of the figures.
Ashley owns 55.14pc of the business and Hellawell is only prepared to recognise numbers that include the founder’s vote. ‘I don’t think you can take out Ashley,’ he says. ‘If you look at that vote, three- quarters supported me. Any union represent- ative or politician would be delighted with that. I’d like 100pc but that’s never happened.
‘Although there have been criticisms – I think unjustified and in some cases incorrect – the majority of independent investors voted for our policies.’ Others, who had links to trade unions, used the annual meeting to raise questions about a host of issues including alleged bullying and poor working practices. But Hellawell is having none of it.
‘There are people there with their own agenda,’ he says. ‘Unions trying to recruit new members. It is clear that whatever we say they would continue with their agenda. The lack of people [attending the AGM] indicates a lack of interest.’
The reality is some might have found it challenging to reach the remote location in time for the 11am start, but Hellawell explains the meeting needs to be held in Shirebrook so those attending can see the scale of the operation.
Just 27 people made it compared with the 3,000 who came to the AGM of fellow FTSE 100 retailer Marks & Spencer in London earlier this year. Whereas only one shareholder praised Ashley, others honed in on what they claimed to be the firm’s shortcomings.
But Hellawell says: ‘When people distort the reality it makes you less inclined to be open.’
The chairman seems to operate in a parallel universe to the firm’s critics. He knocks down every argument, conceding no ground. He talks with such conviction it is difficult to know what is real. I ask whether he thinks the firm is treated unfairly? ‘I wouldn’t choose those words,’ he says. ‘But I don’t think the business is understood. People recognise it is not your typical FTSE 100 company and operates in a slightly different way, but it is professional.’
He says zero hours contracts is a big issue: ‘ We comply with all the laws and regulations so why is there a focus on Sports Direct for doing things many others do that is well within the law?’
He seems to spend much of his life defending the retailer. But although any firm can maximise profit by pushing their business within a hair’s breadth of the law, most choose to strike a balance and attempt to do the right thing by customers, staff and investors.
Unions have described the working practices at Sports Direct as Dickensian and MPs accused the FTSE 100 firm of being like a backstreet operation.
‘It is nonsense about being a Dickensian workplace,’ says Hellawell. ‘Everyone can see it’s a professional organisation.’
It is not just Sports Direct which is atypical. Hellawell had a remarkable journey becoming a FTSE 100 chairman.
Born in Huddersfield, Yorkshire, in 1942, he left school aged 15 to become a coal miner, joining the police in 1962, going on to be the UK’s youngest sergeant, aged just 23. He rose through the ranks become chief constable of Cleveland and then West Yorkshire and was known for his strong vews in support of the death penalty and legalising brothels.
HE seems to like being the centre of attention. His autobiography published in 2002 was called ‘The Outsider: the autobiography of one of Britain’s most controversial policemen’.
He is fast becoming the most controversial FTSE 100 chairman too, having decided some time ago to enter the world of business to take up non- executive roles. ‘ My skills managing large corporations have been honed in the police force, having had to manage a £1bn budget, 10,000 employees, substantial real estate, and the largest vehicle fleet in the country.
‘Having left the police service I’ve worked in various businesses across Europe.’
Between 1998 and 1999 he was a non-executive at property firm Evans of Leeds, from 2003 to 2006 he was at energy firm Dalkia and also chemical business Sterience until 2006, which was part of French firm company Veolia. But it was under his chairmanship of drugs firm Goldshield that it was investigated by the Serious Fraud Office, a case that was thrown out as ‘a waste of taxpayers’ money.
Aged 73, he says he doesn’t want a quiet life. ‘ No, I love it,’ he says. ‘There is nothing like being involved when executives know a business backwards and work tirelessly to improve it.’ But is he an effective chairman? ‘Obviously the answer to that is yes. Every company I have been involved with has been successful. People wouldn’t work for us if they were as unhappy as people make out.’
Each sentence is delivered with such self-assurance it is impossible to know what to think.