Tesco suspends Kevin Grace: Fifth executive leaves over £250m profit miss
Tesco has suspended a fifth director over a shock discovery last month of an error in its accounts which meant first half profits were overstated by £250m.
Kevin Grace, Tesco’s group commercial director, was asked on Monday to step aside as Deloitte and Freshfields carry out their investigation into what went wrong in Tesco’s accounts.
The retailer has already suspended four senior executives, including its UK managing director Chris Bush, as well as UK finance director Carl Rogberg, its head of food sourcing Matt Simister and Tesco’s food commercial director John Scouler.
Grace, who has worked for Tesco for over 30 years, was appointed to group commercial director in 2011 after a year-long search to fill the new post.
He was previously property services director and has also worked for Tesco in South Korea as chief operating officer and chief executive in Poland.
Tesco declined to comment yesterday.
The company’s new chief executive Dave Lewis, who was parachuted into the business in September a month earlier than planned, has already begun work on turning the retailer around after a dismal year.
Tesco’s sales have suffered their biggest decline in four decades and last month issued a third profit warning of the year. It was also involved in a £250m accounting error. Around £3bn has been knocked off Tesco’s market value after investors fled for cover.
Other supermarkets are also struggling amid growing competition from discounters, falling food prices and declining footfall at their big stores as convenience stores grow in popularity.
Speaking at the industry’s IGD conference yesterday, Morrisons new chairman Andy Higginson said consumers had “lost trust” in the big four supermarkets, accusing the big four of focusing too much on each other rather than on their customers.