Now investors demand Ashley’s scalp

THE backlash against Mike Ashley intensified last night when an influential group of investors called for him to be removed from his job at Sports Direct.

The billionaire tycoon, who is executive deputy chairman of the company he founded, has been heavily criticised for the way he runs the business and the shocking treatment of staff – including not paying them the minimum wage.

The Institutional Shareholder Services has recommended investors vote against his reelection at what is likely to be a stormy annual general meeting on September 7.

The group said Sports Direct is ‘mired in controversy’ and described Ashley as ‘the central figure’ who must be held to account.

It also called for a vote against the re-election of Keith Hellawell as chairman, noting that he ‘bears ultimate responsibility for the governance of the company’.

ISS added: ‘Attention is at a heightened focus in the wake of the events of the past year – the dual effect of an extended decline in share price and a seemingly endless sequence of negative headlines. Perhaps the most damaging of these was the company’s admittance that it paid workers at its main distribution centre an effective wage below the legal minimum.’

The humiliating report for Ashley came a day after the Investor Forum, an exclusive group of 40 asset managers, insurers and pension funds with £14.5trillion under management, launched an attack on management at the retailer.

It has been a brutal 12 months for pile-it-highand-sell-it-cheap Sports Direct with its shares down more than 60pc. Ashley, who owns 55pc of the sportswear retailer, has already been criticised by MPs after a select committee hearing into the ‘appalling’ working conditions and practices at the retailer’s shops and warehouse in Shirebrook in Derbyshire.

The working environment was described as like a Victorian workhouse.

It also emerged that Ashley had hired his daughter’s partner Michael Murray, a former nightclub promoter, in a key consultancy role which could see him earn as much as £2.5m a year. And Sports Direct uses a company run by Ashley’s brother John to deliver online purchases outside the UK.

Shares fell 0.1pc or 0.3p to 305p.