The joint inquiry by the work and pensions select committee and the business, innovation and skills select committee found that Green’s family became “incredibly wealthy” during their 15 year ownership of BHS, leaving the retailer and its pension fund weakened to the point of collapse, reports CityAM.
Frank Field, chair of the work and pensions committee, said: “One person, and one person alone, is ultimately responsible for the BHS disaster. While Sir Philip Green signposted blame for 11,000 job losses and a gigantic pension fund hole to every known player, the buck stops with him.”
In the hard-hitting report, the MPs cite personal greed and a litany of leadership failures as two of the factors leading to the retailer’s failure. They say the manner of its collapse leaves a stain on the reputation of business, and exposes gaps in company law.
“[Green’s] reputation as the king of retail lies in the ruins of BHS. His family took out of BHS and Arcadia a fortune beyond the dreams of avarice, and he’s still to make good his boast of ‘fixing’ the pension fund. What kind of man is it who can count his fortune in billions but does not know what decent behaviour is?” said Field.
The MPs urge Green to follow his “moral duty” to BHS pensioners that are facing hefty cuts to their pensions. They say he should make a large financial contribution to the retailer’s pension fund which is £571m in deficit.
“To an extent, it [BHS] created him; it could also bring him down,” the MPs added. Green’s knighthood is under review by the Cabinet Office while the BHS debacle has also attracted interest from the Serious Fraud Office, the Insolvency Service and the Financial Reporting Council.
The MPs argue that the story of BHS also begs much wider questions about gaps in company law and pension regulation that must be addressed. These matters will now be the subject of further inquiries.
The 60-page report details how Green’s family, who owned BHS from 2000 to 2015, cut costs, failed to invest sufficiently in the business and paid substantial dividends offshore which ultimately benefited his wife to the tune of £307m.
A series of failures then led to the disposal of the business last year to Dominic Chappell and his Retail Acquisitions vehicle. MPs branded Chappell “manifestly unsuitable” and a “chancer.”
Iain Wright, chair of the business select committee, said: “There was a complete failure of corporate governance, with Philip bulldozing the sale through, without proper oversight or challenge from his weak and impotent board.”
