Sports Direct announces independent review of working practices

Mike Ashley. Picture c/o BBC.
Mike Ashley. Picture c/o BBC.

Sports Direct is to undertake an independent review of working practices and corporate governance, following concerns raised by shareholders.

The so-called "360 degree" review was initially to be led by the retailer's law firm RPC.

However, the Mike Ashley-owned firm said on Tuesday that following discussions with shareholders, including the influential Investor Forum, the review "will now be led by an independent party other than RPC".

"The board has made this decision after listening to shareholder feedback at the recent AGM/Open Day and during subsequent consultation with a number of the company's long-standing shareholders via the Investor Forum," Sports Direct said.

The Investor Forum consists of investors holding assets worth more than £14 trillion and the move comes after independent shareholders rebelled at the retailer's AGM, with 53% opposing the re-election of chairman Keith Hellawell.

The company has faced sharp criticism over corporate governance and working practices at its warehouse in Shirebrook, Derbyshire, after it was revealed that some warehouse staff were paid below the national minimum wage.

Sports Direct has moved to address concerns by offering casual retail staff guaranteed hours instead of zero hours contracts and ensuring all warehouse staff are paid above the national minimum wage following an initial review by RPC.

In addition, the company said that the selection process for having a workers' representative on the retailer's board will be via "democratic staff elections, in which it is anticipated that all staff directly engaged or employed by Sports Direct may vote".

Unite assistant general secretary Steve Turner said: "At last Mike Ashley and his board have grasped that they need to take some very serious steps to restore shareholder, consumer and worker confidence in their employment practices.

"We have always urged, as we did at this year's AGM with the backing of investors, that an independent review is a vital component of this company truly getting to grips with its many and serious employment problems, so we are pleased that the company has now seen sense.

"We offer every assistance in the next steps in Sports Direct's journey towards fair employment, including with this review, and call on Mr Ashley to recognise the benefits of working with the union during this process as an essential way to build faith with the workforce."

Jonathan Bartley, co-leader of the Green Party, welcomed the announcement, saying: "Sports Direct has continually dragged its feet and tried to avoid the fully independent review into working practices that's so desperately needed, so this announcement is as welcome as it is overdue.

"This is only the beginning of a process which must see the end of exploitation at Britain's biggest sports firm.

"Slowly but surely we're seeing trade unions, shareholders and campaigners force big firms to address the profound injustice being faced by so many workers in Britain."