A second leading shareholder group has called for Sports Direct PLC (LON:SPD) founder Mike Ashley to shake up the way he runs the beleaguered sportswear retailer.
Institutional Shareholder Services (ISS), which advises investment institution on key decisions, has urged shareholders to vote against the re-election of Ashley as deputy executive chairman and Keith Hellawell as chairman.
It is unusual for ISS to oppose the re-election of a director but said Mike Ashley had to be accountable for operational issues that appear to be long-standing and serious.
"Recent events, with a sequence of negative headlines and concerns in a number of areas, combined with an extended decline in share price, indicate material failures of governance and risk oversight."
The call follows a scathing attack yesterday from Investors Forum.
The group, which represents some of the world’s largest investment funds, heavily criticised the governance at Sports Direct in what was a first ever public airing of its views on a company.
Earlier this year a committee of MPs accused Ashley of using Victorian-style workhouse practices at its Shirebrook warehouse.
In response, Sports Direct has appointed a law firm to compile a report on Shirebrook that will be available ahead of the AGM on 7 September. There will also be an open day for investors on the same day.
Ashley, who still has a 55% majority stake in Sports Direct, has also come under fire for revelations this week that a company owned by his brother earns £300,000 profit a year distributing Sports Direct products overseas while his daughter’s boyfriend now runs its property portfolio.
Shares in the group were little changed today at 305p but have shed two-thirds of their value over the past two years.