Sports Direct investors to oppose directors' board appointments at other firms
Sports Direct's board of directors have been warned by an influential shareholder group that they will face opposition if they attempt to join the boards of other public companies.
The move by the Pensions and Investment Research Consultants (Pirc) comes after independent investors rebelled at the retailer's annual general meeting (AGM) on Wednesday, with 53% opposing the re-election of chairman Keith Hellawell.
Pirc had recommended ahead of the AGM that independent shareholders vote against both the re-appointment of Mr Hellawell and founder Mike Ashley, who is the company's executive deputy chairman.
"In Pirc's view the board shows a collective failure to understand the requirements of being a public company," a spokesman said.
"Included in that is showing contempt for the outside shareholders by ignoring the majority view on the position of the chairman.
"That fails to meet Pirc's threshold for fitness for office at a public company and Pirc will be opposing each director's appointment on boards of other public companies."
Mr Hellawell had offered his resignation at the weekend, but the former West Yorkshire Police chief constable said that he would remain in the role after the board unanimously backed him to continue .
He added that he would step down at next year's AGM if he does not have the support of shareholders.
The company has faced sharp criticism for its working practices and corporate governance after it was revealed that some warehouse staff were paid below the National Minimum Wage.
Mr Ashley, who owns 55% of Sports Direct, attempted to appease journalists and investors at the AGM by leading a walking tour of the Shirebrook Warehouse to show how the board was turning the business around .
However, the move appeared to backfire after the billionaire retail tycoon drew fresh criticism for pulling out a wad of fifty pound notes as he emptied his pockets during a mock security search.