As they say, the fish rots from the head.
It is impossible to read Alison Levitt QC’s excruciatingly critical Boohoo report without concluding that chairman and founder Mahmud Kamani has to quit the board. He has skilfully built Boohoo into a fabulously successful company, but the business has outgrown him. The culture around him appears toxic.
Levitt writes of directors terrified of contradicting him, his board rejecting requests to hand over emails to the investigators, Boohoo witnesses refusing to co-operate with the investigation. He created a situation where directors were obsessed with profit (no bad thing) but hopelessly unaware of the supply chain. Even when they knew something was amiss, they failed to act fast enough.
Kamani replaced Selfridges and Asos veteran Peter Williams as chairman last year, stepping back from his chief executive duties. But — as Williams has testified — his influence is everywhere in the way the company operates as a family-run business.
He should quit the board and let it behave like the £4.5 billion plc it has become.
It’s a hard thing to do, for a founder to let go of the reins, but he would be doing his impressive empire a favour. This corporate calamity on his watch has not only led to abuses of vulnerable workers on British soil, but to shareholders losing millions of pounds of value in the company.
And note how Levitt points out the board gave not a thought to how poor working conditions could affect shareholders who have seen their stock plunge due to the scandal. Wait till their lawyers get a load of that.
Levitt massages Kamani’s ego to suggest he could become an icon of good practice if he makes real change to this business.
It would be better for him to leave and have a properly independent board, to reshape the company’s entire culture so it can be proud of itself again.