The boss of JD Sports has stepped down with immediate effect just months after the retailer was fined more than £4m for breaching the competition regulator’s rules with clandestine meetings with a takeover target.
The company said Peter Cowgill, the outspoken chair and chief executive officer of JD, who has led the group since 2004, would be temporarily replaced as chief executive by Kath Smith, its senior independent director who spent 25 years as managing director of the Adidas and Reebok brands.
It is understood Cowgill, 69, who has sold more than £50m of shares in the company in the past two years, is leaving after he attempted to block attempts by the board to bring in new blood and split the roles of chair and chief executive, which Cowgill has jointly held since 2014.
The company was also hit by a shareholder revolt over pay last year after it emerged that Cowgill was paid almost £6m in bonuses despite the company accepting more than £100m in government support. The company did not say if Cowgill would receive a payoff.
Cowgill’s sudden exit will be a major blow to the company where he has overseen a turnaround in fortunes since returning as executive chair three years after quitting as finance director in 2001.
Under his watch, the group has expanded internationally, built a successful online business and joined the FTSE 100 after acquiring a portfolio of brands including Sprinter, Go Outdoors and Fishing Republic.
JD Sports and Footasylum were fined a combined total of £4.7m in February for sharing commercially sensitive information. An investigation by the UK competition watchdog accused them of deleting phone records, and found their chairmen to have held multiple clandestine meetings including one caught on video in a car park near Bury in Greater Manchester.
JD bought the trainer retailer Footasylum for £90m in 2019 in a deal that was subsequently subjected to an in-depth investigation by the Competition and Markets Authority.
Helen Ashton, who is stepping in as interim chair of JD, said: “The business has developed strongly under Peter’s leadership into a world-leading multi-channel retailer with a proven strategy and clear momentum.
“However, as our business has become bigger and more complex, what is clear is that our internal infrastructure, governance and controls have not developed at the same pace.
“As we capitalise on the great opportunities ahead of us, the board is committed to ensuring that we have the highest standards of corporate governance and controls appropriate to a FTSE 100 company to support future growth.”
The company said it would continue the process of searching for a chief executive and would now begin searching for a new non-executive chair.
JD’s majority shareholder, Pentland, said new leadership and a change in governance structure were “necessary steps to ensure the long-term, sustainable growth of the business and that JD embraces the scrutiny and responsibility which comes with being a FTSE 100 company”.
Pentland said in a statement: “The JD team, under Peter Cowgill’s leadership, has delivered an unprecedented period of success over a number of years which has led to significant growth in the business and its operations.
“With such growth comes a responsibility to ensure the business continues to evolve its internal organisation. As supportive, long-term shareholders we recognise that now is the right time for the business to fulfil its future ambitions under a new governance structure and new leadership.”
In February, JD said it was delaying publishing its annual results partly because it wanted to complete a review of its governance procedures and policies. The announcement is expected next month.
