Boohoo founders’ pay packets rose to £1.4m each last year despite working conditions row as fast fashion firm pledges to link multi-million pound bonuses to improving workers’ lot
- Founders Mahmud Kamani and Carol Kane paid £1.39 million and £1.38 million
- Boohoo said it will link long-term bonuses to the running of Agenda for Change
- It recently faced criticism from investors over its long-term incentive scheme
Boohoo paid its founders almost £1.4million each last year amid furious allegations of poor working conditions, it emerged today.
It comes as the fast fashion firm pledged to link multimillion-pound bonuses for its directors with improvements in its supply chain.
The online retailer faced criticism from investors last year over its long-term incentive scheme, which could see founders and directors paid up to £150million.
Boohoo has said it will now link long-term bonuses to the implementation of its Agenda For Change programme after pressure from Parliament’s Environmental Audit Committee.
The group’s annual report also revealed that total executive pay had slipped as Boohoo’s chief secured a lower pay packet for the past financial year.
Founders Mahmud Kamani (left) and Carol Kane (second from right), received marginally higher pay packets last year
The online retailer faced criticism from investors last year over its long-term incentive scheme, which could see founders and directors paid up to £150million
It said that the total pay packet for executive directors fell by 17.6 per cent to £5.41 million for the year to February, compared with £6.57 million in the previous financial year.
The slump was primarily caused by a significantly lower pay deal for the group’s chief executive officer John Lyttle.
Mr Lyttle saw his total pay deal, which included a base salary of £615,000, fall to £1.57 million from £2.7 million in the previous year after failing to meet targets to secure long-term incentives.
Meanwhile, other directors on the company board, including founders Mahmud Kamani and Carol Kane, received marginally higher pay packets.
Pictured: Workers at the Faiza Fashion factory in Leicester last summer. The factory supplied clothes to Boohoo
Executive chairman Mr Kamani, who owns a 12.5 per cent stake in the business, saw his pay packet increase by 1.2 per cent to £1.39 million for the year, including a £900,000 annual bonus.
Executive director Ms Kane also saw her pay deal nudge slightly higher, rising to £1.38 million for the year.
In the report, Mr Lyttle also highlighted the progress he said the company had made improving corporate governance following the supply chain accusations.
It was alleged last year that some factories in the UK working for the firm were paying staff as little as £3.50 an hour and had working conditions which did not meet lockdown restrictions.
Boohoo CEO John Lyttle (above) saw his total pay deal, which included a base salary of £615,000, fall to £1.57 million from £2.7 million
Pictured: Mahmud Kamani (right), co-founder of Boohoo with his son Umar Kamani (left)
He said the business was ‘on track’ to deliver on the 17 recommendations made by QC Alison Levitt, following her report into the scandal.
In March, the business slashed ties with around 400 supplier firms as part of these changes.
Earlier this month, Boohoo reported that revenues jumped 41 per cent to £1.74 billion in the year to February 28.
Pre-tax profits lifted by 35 per cent to £124.7 million as the group was boosted by higher sales and the ‘successful integration’ of brands bought out of administration, including Oasis and Warehouse.
Indian-born billionaire who launched fast fashion firm Boohoo from Manchester market stall and expanded online with his playboy children
The Indian-born founder of fast-fashion company Boohoo grew his Manchester market stall into a £2.6billion business.
Before Boohoo shot onto the ever-growing fast fashion scene, its owner Mahmud Kamani, 55, sold handbags in traders’ stall.
He spotted the potential of internet sales and set up his online retailer in 2006 with the aim of delivering their own-branded fashion at rock bottom prices.
It since became synonymous with the wildly popular, yet equally controversial, fast-fashion phenomenon.
The Indian-born founder of fast-fashion company Boohoo grew his Manchester market stall into a £2.6billion business
Its sales topped £850 million in 2019, propelling Mr Kamani to 131st place on The Sunday Times Rich List, with a family fortune of £1.16 billion.
Mr Kamani’s parents, who were originally from India, arrived in Manchester from Kenya in 1969 when his father was just two years old.
The Kamanis were forced to flee to Britain by increasing unrest and draconian employment laws that favoured native Kenyans.
Entrepreneurial Mahmud sold handbags on a market stall. He invested his money wisely in property and began a wholesale business, Pinstripe, sourcing garments from India.
By the early 2000s, the company was selling £50 million-worth a year to high street brands such as Topshop and Primark, which led to Mahmud setting up the Boohoo brand in 2006.
The company’s growth quickly skyrocketed and is now believed to be worth £2billion or more and employing 2,352 people.