Ray Kelvin, the founder and part owner of British high-street retailer Ted Baker, has resigned as CEO amid an investigation into allegations of misconduct and inappropriate physical contact with staff.
Kelvin, who took a voluntary leave of absence last year, denies all allegations of misconduct. Acting CEO Lindsay Page will continue in this role while David Bernstein will act as executive chairman. Bernstein said he will continue in this position until no later than Nov. 30, 2020, by which time a successor will be appointed.
An independent committee, appointed late last year, is still investigating claims against Kelvin and has not yet submitted any findings. It is understood that Kelvin has not seen any draft report or indicative conclusions of the investigation, and made the decision independently. Kelvin holds a 35 percent stake in the business, which is quoted on the London Stock Exchange, and remains a shareholder.
The committee has also commissioned the law firm Herbert Smith Freehills LLP to investigate the allegations and the company’s policies, procedures and handling of HR-related complaints.
The company said Monday the investigation will continue and focus on Ted Baker’s policies, procedures and handling of complaints. The law firm is set to conclude its investigation at the end of the first quarter or early in the second quarter of 2019.
Bernstein said: “Ray Kelvin founded the business 32 years ago and has, together with the fantastic team around him, been the driving force behind it becoming the global brand it is today. We are grateful for his tireless energy and vision. However, in light of the allegations made against him, Ray has decided that it is in the best interests of the company for him to resign so that the business can move forward under new leadership.”
He added that the board of directors wants all employees to feel respected and valued. “We are determined to learn lessons from what has happened and from what our employees have told us and to ensure that, while the many positive and unique aspects of Ted’s culture are maintained, appropriate changes are made.”
According to media reports, staffers accused Kelvin of inappropriate hugging, touching and sexual innuendo. A female employee told The Sunday Times of London that Kelvin scared her and touched her inappropriately while he was wearing a mask during one Halloween in the office.
Staff had also pointed the finger at the Ted Baker human resources department, accusing it of being slow to address their concerns. The company has repeatedly denied wrongdoing.
Kelvin said Monday it was time to move on.
“Difficult though this decision is, given that Ted Baker has been my life and soul for over 30 years, I’ve decided that the right thing to do is to step away from Ted and allow the business to focus on being the outstanding brand it is so it can face 2019 with fresh energy and renewed spirit,” said Kelvin.
He said that as a shareholder in the business, he plans to support Lindsay Page in his leadership and “will be available to him and the team wherever I can” to offer advice.
“I’m extremely proud of what we’ve achieved in building Ted Baker to the global brand it is today. Thank you to every single colleague, customer, supplier and investor for your commitment to the business. We couldn’t have done it without you and I’m so grateful. The past few months have been deeply distressing, and I’ll now be taking time privately with my family to consider what my next adventure will be,” he added.
Last week, Ted Baker said pretax profits will be lower than expected, in the region of 63 million pounds ($83 million), due to a variety of factors, including costs associated with the ongoing investigation, others relating to House of Fraser collapse, and ones linked to the acquisition of the footwear company No Ordinary Shoes Limited from Pentland Group last September.
This story was reported by WWD and originally appeared on WWD.com.