Sports Direct faces attack from asset managers

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The Investor Forum, a group of asset managers with combined assets of £14.5trn, is set to launch a public attack on working conditions and corporate governance issues at UK-listed retailer Sports Direct.

A source told Sky News that the asset management body would today express “bitter disappointment” that Sports Direct had repeatedly failed to address investor concerns. It would also urge shareholders to vote against the reappointment of key board members.

The public action would be The Investor Forum’s first ever statement against a company.

The City group, founded in 2014, represents some of the world’s largest asset management groups, such as BlackRock and Allianz Global Investors.

Sports Direct, 55 per cent owned by its billionaire executive deputy chairman Mike Ashley, is due to hold its annual general meeting on 7 September.

Just this week, the Financial Times revealed that Sports Direct had contracted delivery services to a company owned by Ashley’s brother.

In June, MPs described working conditions at Sports Direct’s factories as akin to Victorian workhouses. Earlier in the year, it was revealed that the 26-year-old boyfriend of Ashley’s daughter had been placed in charge of the company’s property portfolio.

Late yesterday, the company said it would invite members of the public to its headquarters on the day of the AGM to “enable the board to engage with as many people as possible in an open discussion about the business”.

Investor Forum board members include Jupiter Asset Management vice chairman Edward Bonham Carter, Columbia Threadneedle CIO Mark Burgess, and LGIM director of corporate governance Sacha Sadan.

LGIM has voted against the company’s chairman Keith Hellawell for the last two years.

Last week, shareholder advisory service Pensions and Investment Research Consultants recommended investors block Ashley’s reappointment as executive deputy chairman due to concerns about his “influence on the board”.