Philip Green responsible for BHS collapse: UK lawmakers

Mon Jul 25, 2016 7:35am EDT
 
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By Paul Sandle and James Davey

LONDON (Reuters) - Retail tycoon Philip Green's greed and disregard for corporate governance led to the demise of BHS and cost 11,000 jobs, a report by British lawmakers said, calling the collapse of the stores group "the unacceptable face of capitalism".

Billionaire Green, 64, owned BHS for 15 years before he sold the loss-making 180-store chain to Dominic Chappell, a serial bankrupt with no retail experience, for one pound last year.

It went into administration in April, and all remaining 114 stores are due to close in the next four weeks.

The business was sold with a 571-million-pound ($750 million) hole in its pension fund, which if not filled will leave 20,000 pensioners facing significant cuts to their income.

"(Green's) rush to drive through the sale of BHS - a chain that had become a financial millstone and threatened his reputation - was the culmination of a sorry litany of failures of corporate governance and greed," Parliament's Work and Pensions and Business Committees said in a statement on Monday.

The committees said Green had a "moral duty" to find a resolution for BHS pensioners.

They said the demise of BHS - the biggest collapse in the British retail industry since Woolworths in 2008 - begs much wider questions about gaps in company law and pension regulation that must be addressed. The two committees will turn to those questions in new inquiries.

Their damning report represents a test for new Prime Minister Theresa May who promised on taking office to crack down on irresponsible corporate behavior.   Continued...

 
Pedestrians walk past a BHS store in London, Britain July 25, 2016. REUTERS/Neil Hall