Tesco chairman John Allan resigns following allegations of misconduct

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Tesco chairman John Allan is set to step down next month after eight years in the role, later allegations about his behavior towards women who risked “becoming a distraction” for the largest supermarket chain in the UK.

Allan, also a former chairman of the CBI trade advocacy group, denies three separate allegations of inappropriate conduct. He apologized “unreservedly” over a fourth allegation in which he admitted to telling a CBI employee that his suit “fitted his figure.”

His imminent departure from Tesco comes as the future of the CBI remains in doubt. More than a dozen women complained separately a toxic culture at the lobbying group, as well as allegations of sexual harassment, bullying and other workplace misconduct.

The city veteran will step down June 16 at Tesco‘s annual meeting, the supermarket group said on Friday. Tesco was already looking for Allan’s successor as his mandate was due to end soon. It will conclude “in the near future,” he said. Byron Grote, the supermarket’s senior independent director, will become interim president.

The three allegations Allan denies include two separate alleged incidents of touching a woman’s butt at a CBI dinner in May 2019 and then during Tesco’s annual shareholder meeting in June last year. Allan also denied claims that in 2021 he made comments about a woman’s butt.

Tesco said on Friday it had not identified any evidence or complaints in relation to the AGM or Allan’s behavior during his tenure after initiating “a sweeping review of the allegation”, which was reported by The Guardian newspaper this month on the wake of the scandal that engulfed the CBI.

The firm, which sought outside legal advice from the Freshfields law firm, said it had reached out to meeting attendees, including former employees, to ask them to come forward if they had concerns.

Tesco was reeling from an accounting scandal when Allan joined in 2015, having overstated its profits by £263m. The FTSE 100 company has hit a £129m penalty settlement with the Serious Fraud Office on the matter. As chairman, Allan presided over a relaunch of its fortunes under previous chief executive Dave Lewis and took over current Tesco boss Ken Murphy.

Allan, who also chairs homebuilder Barratt Developments, said in a statement on Friday: ‘It is with regret that I have to step down prematurely from my position as chairman of Tesco Plc following the anonymous and baseless allegations made against me, such as reported by the guardian. These allegations are completely without foundation, as evidenced by the internal procedures undertaken by Tesco”.

He added: “Tesco undertook an ‘extensive internal review’ which included inviting Tesco employees and former employees to come forward on an anonymous basis if they had any concerns about my conduct. Tesco also conducted contact with those attending the meeting where the incident allegedly took place and video footage of the meeting was also reviewed. There is no evidence of any wrongdoing at the time or at any stage of my presidency at Tesco and I remain determined to prove my innocence.”

Grote praised the 74-year-old for his “valuable contribution to Tesco” but said the allegations “risk becoming a distraction”. He added that the council’s search for a new chair was “well advanced”. According to previous reports, Allan was in line to step down early next year.

Barratt, where Allan will step down in September, declined to comment.

Dr Clive Black, retail analyst at Shore Capital, said it was “unfortunate that something of this nature is part of the grocer’s story”.

He added, “The board will want someone who can demonstrate, primarily to shareholders and the broader stakeholder base, that this is a company that stands for what is right and someone who can bring quiet stability.”