Pressure rises on Sports Direct chairman as investors oppose his re-election
The pressure on Sports Direct chairman Keith Hellawell has been ratcheted up after a number of investors in the retailer publicly voiced their opposition to his re-election ahead of a crunch vote next week.
Mr Hellawell has presided over a long list of scandals and controversies at the Mike Ashley-controlled tracksuit chain, and has pledged to step down if he does not receive the support of a majority of independent shareholders at the firm's annual general meeting on Wednesday.
The former West Yorkshire Police chief constable and government drugs tsar is now sweating on his future after Royal London Asset Management and Standard Life Aberdeen said they would oppose his reappointment.
Ashley Hamilton Claxton, corporate governance manager at Royal London, said: "Sports Direct continues to show a serious disregard for shareholders' views about the governance and management of the company.
"We have no confidence in the ability of the firm's chairman and non-executive directors to provide effective oversight and protect the interests of minority investors.
"For this reason, we will be voting against the firm's CEO, chairman of the board and the lead independent director."
The strong comments come after a trio of shareholder advisory firms - Institutional Shareholder Services, PIRC and Glass Lewis - recommended that investors vote against Mr Hellawell's reappointment.
Paul Lee, head of corporate governance at Aberdeen Standard Investments, told the Press Association that the fund manager also intends to vote against the chairman.
"They have come quite a long way since this time last year, and the level of transparency has increased.
"But we don't think it has moved on significantly enough, so we will be opposing Mr Hellawell's reappointment," he said.
Aberdeen Standard Investments holds 0.5% of Sports Direct shares and Royal London holds 0.19%.
Among the chief concerns of shareholders is Mr Hellawell's inability to rein in Mr Ashley.
Last year the tycoon was hauled before MPs to be grilled over "Victorian" working conditions at the retailer's warehouse, the company hosted a farcical "open day" at its headquarters, and its chief executive Dave Forsey quit - only to be replaced by Mr Ashley.
The Newcastle United owner admitted paying some staff below the minimum wage and was taken to task over the firm's controversial use of zero-hour contracts.
Late last year the Financial Reporting Council announced an investigation into Sports Direct over the retailer's relationship with a firm owned by the tycoon's brother.
Undeterred, Mr Ashley announced in December that the company had entered into an agreement with Double Take Limited, of which his daughter Matilda is a director.
In the meantime, profits at Sports Direct have tumbled and shareholders have become restless.
In January, Mr Hellawell saw 54% of independent shareholders vote against his reappointment and was only saved by Mr Ashley, who owns 55% of the company and whose backing meant he was re-elected with a total of 80.92% of votes cast.
But his promise ahead of next week's AGM to stand down with "immediate effect" unless he secures the backing of independent shareholders raises the prospect of Mr Hellawell having to quit the AGM, which he is leading, half way through.
Mr Ashley will not be in attendance because of "conflicting demands".
But Mr Hellawell will find solace in the fact that Phoenix Asset Management Partners and Aurora Investment Trust intend to vote for his reappointment.
Tristan Chapple, director at the fund, said: "The Sports Direct management team is doing a good job of running the business.
"As 3.6% owners of Sports Direct we will be voting in favour of Keith Hellawell's re-election."