No weeping for Boohoo
Last week Boohoo launched a controversial £150 million bonus scheme for top executives. It didn’t go down entirely well.
The generous scheme just requires the shares to hit a certain target, taking the value of the business from £4.5 billion to £7.5 billion.
That would be a big jump, but it matters not whether rivals do as well as that or even better – hence the controversy.
My view at the time was that they’d get away with it so long as there were no other nasties lurking in the background.
A few days later The Sunday Times reported that Boohoo faces a “slavery” investigation because one of its suppliers pays staff as little as £3.50 an hour.
Boohoo disputes some of the claims and says it is looking into others. It’s main point though is simply that it didn’t know what was going on in Leicester.
Perhaps there was a time when that was a reasonable excuse. Now it just invites more questions, mostly: why didn’t you know? What else don’t you know? Are you running this company or not?
Still, the sting has gone out of the share award scheme. The stock has crashed and the company is now worth only £2.8 billion, a long way shy of the target.
No one is going to feel sorry for Boohoo.
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