The embattled chairman of Sports Direct is to remain in place despite calls from 53% of independent shareholders for him to go.
The discount sports retailer announced on Thursday that 80.9% had voted for Dr Keith Hellawell’s re-election at a general meeting held at the company’s Shirebrook headquarters.
However, the seemingly strong level of support is due to the votes of Mike Ashley, Sports Direct’s founder and CEO. Ashley controls 55% of shares in the business.
53% of the independent shareholder votes cast called for Hellawell to go. However, Ashley’s voting power means they have no legal sway and Ashley signalled he is committed to keeping him on.
Ashley says in a statement: “Keith has my full backing and will be continuing in his role on the basis that he has the unanimous support of the Board. I note that many of those who voted against Keith have acknowledged that we have made positive progress since the AGM.”
It is by no means the first time shareholders have tried to oust Hellawell. Independent shareholders rejected his re-election in September, the latest vote against him. Standard Life, Sports Direct’s second-biggest shareholder, said at the time: “Substantial strengthening of the non-executive members of the board will be required, particularly in the crucial role of Chairman [Keith Hellawell].”
Dr Hellawell, a retired police officer, tried to resign in September but his resignation was refused by Ashley.
Sports Direct has been under pressure from the press, MPs, and investors for over a year, amid scrutiny of its working practices and warehouse conditions. An investigation by the UK parliament’s Business, Innovation, and Skills Committee concluded that Sports Direct’s warehouses were run like “a Victorian workhouse.”
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.