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Sports Direct chair resigns after pressure from shareholder adviser

The Financial Times logoThe Financial Times 12/09/2018 Adam Samson in London
© PA

Sports Direct said on Wednesday its longtime chairman will resign after an influential shareholder advisory group accused the board of “poor governance.”

Keith Hellawell, who has served in the job since 2009, is to resign at the end the group’s annual shareholder meeting, which is taking place on Wednesday. David Daly, non-executive director, will take up the role of chairman.

Sports Direct said Simon Bentley, a non-executive director, has also chosen to retire, having served on the board since 2007. Nicola Frampton, managing director of UK retail at William Hill, will join the board at the start of October. 

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Glass Lewis, the proxy firm, last month urged investors to vote against the re-election of Messrs Hellawell and Bentley, along with Sports Direct’s billionaire founder Mike Ashley. 

The group cited “poor governance” and lacklustre responses to shareholder concerns for its decision. It also warned Sports Direct’s plans to acquire House of Fraser, which were announced just after the department store went into administration, had drawn attention from regulators.

a person standing in front of a store: People walk past a Sports Direct shop in Oxford Street, London on August 6, 2018. © Provided by Financial Times People walk past a Sports Direct shop in Oxford Street, London on August 6, 2018.

“Shareholders should be concerned with any type of regulatory investigation involving the company, as such matters could potentially expand in scope and prove to dampen shareholder value,” Glass Lewis said.

On Wednesday, Mr Ashley said: “I would like to thank Keith and Simon for their valuable service and significant contributions to the company over the years.”

Mr Hellawell added that “having overseen significant improvements in the working practices and corporate governance of the company, which includes a refresh of the board, now is the right time for me to step aside.”

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