Marks & Spencer is hoping to quash the growing investor revolt over the promotion of Sir Stuart Rose (pictured) from chief executive to executive chairman by explaining the move to the Association of British Insurers.
The board of M&S is expected to write to the ABI this week to explain its decision to breach best practice guidelines. The move comes after Schroders became the latest shareholder to issue a public rebuke to the retailer, claiming that Rose’s promotion was setting an “appalling example.”
It follows public criticism from Legal & General, which argued that the combined role was an unnecessary dilution of corporate governance standards.
The appointment of an executive chairman is in breach of corporate governance best practice guidelines, though M&S has argued all along that the latest move is in the best interests of the company. The UK’s combined code for corporate governance also says that companies must either comply with the code or explain any deviations from it.
It is also expected that the current M&S chairman Lord Burns, senior non-executive Sir David Michels and Rose will also meet shareholders this week to mount a charm offensive.