RLAM cranks up pressure on Sports Direct

Added 6th September 2016

The publication of a report into working practices at retailer Sports Direct has not been enough to fully appease shareholders, with Royal London Asset Management urging further steps.

RLAM cranks up pressure on Sports Direct

RLAM has said that the report, which was compiled by Sports Direct’s own law firm, does not go far enough and an independent report should be produced.

This is despite the report recommending improvements to workers’ terms including giving casual staff on zero hours contracts permanent employment with guaranteed hours.

“The findings and recommendations of the working practices report conducted by Sports Direct’s law firm focus primarily on the failings already highlighted by the media and by the MP committee,” said Ashley Hamilton Claxton, corporate governance manager at RLAM. “Giving workers the option to choose guaranteed hours over zero hour contracts and to pay them above national minimum wage is a positive improvement on previous practices but sets the bar quite low.”

The asset manager also called for the replacement Keith Hellawell with a new chairman to oversee the implementation of the necessary changes at the company.

“We are encouraged by Sports Direct’s intention to conduct an external report evaluating the board later this financial year, but the chairman’s position remains untenable and the review needs to be conducted under the leadership of a new chairman, otherwise we are unlikely to see change,” said Hamilton Claxton.

Royal London Asset Management said it has already has voted for a shareholder motion at the Sports Direct AGM on the 7th September calling for a new independent report into working practices.

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Alex Sebastian

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Alex joined Portfolio Adviser in April 2014 and has been a financial journalist since 2008. He has previously held editorial positions at the Financial Times Group and Euromoney Institutional Investor. Alex is NCTJ qualified and has a degree in economics from the University of Sussex.



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