A leading shareholder group has joined the chorus of investors and unions calling for an independent review into Sports Direct, adding further pressure on its chief executive Mike Ashley.
The Local Authority Pension Fund Forum (LAPFF) said it would support a resolution that is being put forward at the retailer’s annual general meeting (AGM) next month, which demands an independent review of Sports Direct’s human capital strategy and working practices.
The LAPFF also informed its member funds about concerns regarding the workplace review overseen by Sport Direct’s lawyers RPC – which would be published in the week beginning September 5.
“LAPFF’s view is that responsible business practices by companies lead to sustainable returns for investors over the long-term,” LAPFF chairman Kieran Quinn said.
“We are worried that this view is not shared by Sports Direct.
“LAPFF’s hope is that an independent human capital strategy review will rectify any workplace practices deemed inappropriate and will help Sports Direct to move forward from the reputational and financial damage it has suffered.”
The news comes after it was revealed that Sports Direct failed to disclose that international deliveries are run by Barlin Delivery – a company owned by Ashley’s older brother, John.
Sports Direct pays Barlin Delivery a share of the revenues deriving from orders dispatched overseas.
On Monday, Royal London Asset Management – which owns a 0.18 per cent stake in Sports Direct – said it had ”lost confidence” in the retailer’s non-executive directors while lobby group Pensions Investment and Research Consultants urged investors to oppose Ashley’s re-appointment as executive deputy chairman.
MPs have also publicly said Ashley needed to be ”held accountable” for the ”appalling” practices at its shops and warehouses, and there are reports of an impending “mutiny” by shareholders towards Sports Direct chairman Keith Hellawell.
Sports Direct announced last week that thousands of its warehouse workers will collectively be handed £1 million in back pay after the retailer came clean over not paying the national minimum wage.