Domino’s top trio to topple amid franchisee unrest | Business News
The three most senior board members at Domino’s Pizza Group are all preparing to step down amid a deepening row with franchisees which has helped wipe hundreds of millions of pounds off the company’s share price.
Sky News can reveal that Domino’s has begun a formal search to replace Helen Keays, who has served on the board for nearly eight years, including the last three as senior independent director.
The development was buried deep in the pizza delivery company’s annual report, which was published last week.
Domino’s, which has exchanged increasingly fractious words with a newly established franchisees’ association, is also drawing up plans for the departures of both Stephen Hemsley, its chairman, and David Wild, chief executive.
The company has extended Mr Hemsley’s term by an additional year “to facilitate orderly succession planning”, the annual report said – a move which risks further inflaming disgruntled store-owners.
Domino’s shares have fallen by nearly one-third over the last 12 months, leaving it with a market value during Tuesday morning trading of about £1.1bn.
Ms Keays has come under fire from some investors who want a new SID in place to give voice to their concerns in the Domino’s boardroom.
The succession planning process may be complicated by the fact that Ms Keays is the only woman on a nine-strong board at a time when listed companies are expected to ensure that one in three directors are female by next year.
The Sunday Times reported last month that relations between the company and the Domino’s Franchisee Association had deteriorated to such an extent that its members were boycotting opening new stores during the first half of 2019.
The row has thrown a spotlight on corporate governance at Domino’s, sparking concerns among shareholders about the tenure of Mr Hemsley, who joined the board as finance director in 1998.
Recently revised guidelines state that chairs are no longer deemed independent after a total of nine years on the board, meaning the extension to his term is likely to attract votes against him at Domino’s next annual meeting, one investor said.
In remarks published in the annual report, Mr Hemsley said: “We note that the provisions of the most recent version of the Corporate Governance Code state that the chair of the board should not remain in post for more than nine years.
“Whilst we acknowledge the Code’s provisions, the timing and sequencing of these board changes must be appropriate for the business, and the Committee is currently formulating its plans.”
A Domino’s spokesman declined to comment further.