Sports Direct shareholders advised to oppose re-election of Mike Ashley to the board
Sports Direct's shareholders have been advised to oppose the re-election of the company's founder Mike Ashley to the board after the retailer become embroiled in a scandal over the treatment of workers.
Pensions and Investment Research Consultants (Pirc) said Ashley had been "highly criticised" by the Business, Innovation and Skills (BIS) select committee for the "appalling working practices" at his Shirebrook warehouse.
Read more: Four of the most jaw-dropping working practices at Sports Direct
Ashley also has too much power on the board, Pirc said, raising concerns about "whether the other directors can objectively challenge and influence the board's decision making process".
Chairman Keith Hellawell also came under fire; Pirc said he had "failed to show leadership in a critical period for the company, which was recently demoted from the FTSE 100 index" and should not be reappointed to the board.
Shareholders will give their verdict on Sports Direct at the company's annual general meeting on 7 September.
In addition to voting on the re-election of Ashley, they will decide whether there should be an independent review of working conditions at Sports Direct.
Read more: Here's the most shocking testimony from the workers at Sports Direct
Pirc recommended shareholders support the review – but said the law firm set to conduct the review, RPC, is "not considered independent".
"The fact that RPC is conducting the review is a major concern," Pirc said.
RPC have been working for Sports Direct and Ashley for several years, raising concerns that they would not be able to hold the board to account.