Not a good look: PIRC advisory group scrutinises JD Sports boss’ multi-million pound exit deal
An influential shareholder advisory group has said JD’s payout to former boss Peter Cowgill is “not a good look” for the sportswear retailer.
Former JD Sports’ boss Peter Cowgill is set to receive a multi-million pound payout after making his departure from the sneaker seller. Exit terms include a £3.5m payment over two years for agreeing to certain limits and £2m over three years for a consultancy agreement.
After decades at the helm of the London-listed firm, Cowgill stepped down from JD Sports in May following several brushes with the competition watchdog.
This deal was dubbed as “most definitely not a good look for the company’s governance,” in a note by PIRC.
PIRC pointed to £4.3m in fines for competition regulation breaches under Cowgill’s tenure.
The retailer was scrutinised by the Competition and Markets Authority (CMA) last year after Cowgill was pictured meeting his counterpart at Footasylum in a car park, appearing to breach takeover rules.
The regulator had ordered JD to sell off the rival shoe seller, citing competition concerns.
A few months later in May, Cowgill stepped down from both his roles as CEO and chair, with the two jobs later being split up between new hires.
PIRC criticised the firm’s decision to have Cowgill in an advisory role and said it did not “seem consistent” with an objective to “shift” governance practices.
“It is hard to argue for a significant change in operations when the previous incumbent is offering advice to both of his replacements,” PIRC stated.
New chair Andrew Higginson told Morning Wire that corporate governance changes will bring the retailer up to pace without being too “heavy handed.”
The business must “catch up” with the growth it has achieved so far, Higginson told City A.M. earlier this month, as some controls and processes “haven’t quite kept pace so far.”
However, it was “critical” to bring the firm up to speed “without killing the entrepreneurial spirit of the business.”
JD Sports said it would continue to be “cautious” about trading, as inflationary pressures and the threat of strike action in its supply chain continue.
The London-listed retailer posted profit before tax of £383.5m, lower than its 2021 sum of £439.5m, in results for the half-year to 30 July.