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By
Reuters
Published
Aug 18, 2016
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Britain's Sports Direct says board to face external review

By
Reuters
Published
Aug 18, 2016

Britain's Sports Direct said on Thursday its board would face an "external evaluation" later this financial year after revelations about working practices at its main warehouse sparked criticism of the firm's corporate governance.



Mike Ashley, the billionaire founder and majority owner of the sportswear retailer, has come in for heavy criticism this year from senior politicians and unions after a newspaper investigation revealed some workers received less than the minimum wage.

Thousands of workers are set to receive back pay totalling about 1 million pounds ($1.31 million), union Unite said on Monday.

The group said in a brief statement on Thursday that "an external evaluation of the board is planned for later this financial year".

An independent report on working practices being carried out by the law firm RPC will be published in the week beginning Sept. 5.

Sports Direct, a mainstay of Britain's shopping streets offering low-priced sports goods through 450 stores, has had a torrid year so far, issuing three profit warnings and losing its place in Britain's FTSE 100 index of leading shares.

British lawmakers in July said Ashley should be held accountable for what they called "appalling" working conditions and practices at the retailer's shops and warehouse, saying the environment was closer to that of a Victorian workhouse than a modern, reputable retailer.

Ashley, who is executive deputy chairman of Sports Direct and owns 55 percent of its equity, told a business committee in parliament in June that the firm may have got too big for him to control but pledged to improve the working conditions.

Britain's Institute of Directors, a body that represents business leaders and promotes high standards in the boardroom, has said problems at Sports Direct are fundamentally about weak corporate governance.

$1 = 0.7608 pounds

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