Co-op in crisis as boss resigns blaming 'ungovernable' board
The Co-operative Group has accepted the resignation of chief executive Euan Sutherland, who described the mutual as "ungovernable", in a fresh blow for the troubled group.
Mr Sutherland apparently offered to stand down on a point of principle, after it was reported over the weekend that the Co-op, which has 31 food stores in Northern Ireland, was planning to offer him and other executives huge pay and bonus increases – including a £1.5m base salary and £1.5m retention payment, plus other perks.
In a statement, Mr Sutherland said he had given "his all" to lead the Co-op's revival but warned that, under its current governance, it is "impossible to implement" the necessary reforms.
He added: "The group must reduce its significant debt and drive major efficiencies and growth in all of its businesses, but to do so also urgently needs fundamental governance reform and a revitalised membership."
Mr Sutherland will not accept his retention and long-term incentive payments. Chief financial officer Richard Pennycook will act as interim boss.
Chairwoman Ursula Lidbetter said she accepted Mr Sutherland's resignation with "deep regret".
She added: "Euan's resignation must now act as a catalyst for the real and necessary change which the group must go through. I would like to thank Euan for his hard work and leadership." Mr Sutherland joined the company in May last year, having been chief operating officer of B&Q owner Kingfisher.
His predecessor, Peter Marks, earned £1.3m last year.
At the weekend, Mr Sutherland appeared to hit out at "an individual, or individuals, determined to undermine me personally" on the Co-op's Facebook page.
Questions about the management of the Co-op were raised after the bank unveiled a £1.5bn hole in its balance sheet last summer. The recapitalisation of the bank left the Co-op Group with a 30% stake – with the rest held largely by hedge funds.