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Britain's Boohoo may link executive bonuses to improved worker rights

Sat, 24th Apr 2021 00:01

LONDON, April 24 (Reuters) - British online fashion retailer
Boohoo is considering linking bosses' multi-million
pound bonuses to Environmental Social and Governance (ESG)
improvements, including workers' rights, it said on Saturday.

The British parliament's Environmental Audit Committee (EAC)
recommended the move following an evidence session in December,
attended virtually by Boohoo co-founder and chairman Mahmud
Kamani and other executives.

At that session Kamani told lawmakers he would fix the
group's supply chain failings.

In September, Boohoo accepted all the recommendations of an
independent review which found major failings in its supply
chain in England after newspaper allegations about working
conditions and low pay, and set out steps to tackle the
problems.

Boohoo, which sells clothing, shoes, accessories and beauty
products targeted at 16- to 40-year-olds, also faced investor
criticism last year for the operation and timing of its new
bonus scheme. The scheme would pay out up to 150 million pounds
($209 million) to its founders and top executives if Boohoo's
share price rose 66% over three years from June 2020.

Kamani and co-founder Carol Kane could each be in line for
50 million pounds, Kamani’s son Samir, who is CEO of BoohooMan,
could be in line for 25 million pounds, while finance chief Neil
Catto could end up with 10 million pounds.

“As we stated in our response to (EAC chairman, Conservative
Party lawmaker Philip) Dunne, the board are discussing this
matter and have shared the group’s proposed approach with a
number of our shareholders, who have given constructive feedback
on our plans to date," said a Boohoo spokesperson.

"Further details of the approach will be included in the
group’s annual report which will be published in May.”

Dunne welcomed the development.

“News last summer emanating from Leicester’s garment
industry appalled us all, with allegations of modern slavery in
supply chains and a lack of covid secure measures in factories,"
he said.

"Bonuses shouldn’t just be linked to breakneck growth.
Boohoo needs to demonstrate that it is delivering verifiable
improvements in workers’ rights and the climate impact of its
products."
($1 = 0.7210 pounds)
(Reporting by James Davey; Editing by Kirsten Donovan)

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