Boohoo appoints retired judge Sir Brian Leveson to oversee supply chain problems

Boohoo has appointed senior retired judge Sir Brian Leveson to oversee its supply chain after it was rocked by allegations of mistreatment of staff at factories in Leicester that supply the online fashion retailer.

Sir Brian will report directly to the board and publish reports into progress made under the company’s Agenda for Change programme.

He has also appointed legal and enforcement specialists to ensure supply chain “is treated fully in accordance with the law and principles of ethical trading”.

Earlier this year, following allegations that some factories in Leicester working for Boohoo were paying staff as little as £3.50 an hour, the Manchester-based company commissioned an independent report.

Alison Levitt QC, who wrote the report, found “serious issues” in the supply chain and said that managers were aware of the problems but had been too slow to act.

She cleared the business from allegations of deliberately allowing poor conditions and low pay for garment workers. However following publication of the report, Boohoo’s auditors PwC quit and one of its main investors Standard Life Aberdeen sold its shares.

Sir Brian said: “Boohoo has recognised that it must institute and embed change so that everyone involved in the group’s supply chain is treated fully in accordance with the law and the principles of ethical trading.

“I look forward to providing independent oversight of the Agenda for Change programme and to working with the Boohoo team, KPMG and the other independent experts to achieve this, while, at the same time, providing publicly available progress reports.”

Mahmud Kamani, co-founder group executive chairman of Boohoo, said he was “fully committed” to the programme.

He added: “I am encouraged by the progress that has been made to date by our teams since setting out our Agenda for Change programme in September.

“Myself and the board are fully committed to this programme, with the appointments of Sir Brian Leveson and KPMG bringing independent oversight, additional expertise and further transparency to a programme that will help us on our journey to lead the fashion e-commerce market globally in a transparent manner.”

At the end of September, the company revealed pre-tax profits jumped to £68.1million in the six months to August 31, up from £45.2 million a year earlier. Revenues were up 45% to £816.5m during the half-year as the company successfully pivoted its offer from party wear to loungewear in response to the pandemic.

Greg Lawless, retail analyst at Shore Capital, said: “Today’s news is another step in the right direction and highlights the need to effect real change at the company, which we believe will be welcomed by independent shareholders.

“We will watch developments closely and look for signs of both improved corporate governance and tangible changes to the operating mode.”