3 weeks ago
43
Dearbail Jordan
Business reporter, BBC News
Primark boss Paul Marchant has resigned following an allegation by a woman about "his behaviour towards her in a social environment".
Associated British Foods (ABF), which owns Primark, said following an investigation by external lawyers, Mr Marchant "acknowledged his error of judgement and accepts that his actions fell below the standards expected" by the business.
Mr Marchant co-operated with the investigation and apologised to the individual, said ABF.
George Weston, chief executive of ABF, said: "I am immensely disappointed. Colleagues and others must be treated with respect and dignity. Our culture has to be, and is, bigger than any one individual."
He added: "At ABF, we believe that high standards of integrity are essential. Acting responsibly is the only way to build and manage a business over the long term."
The company said it remains in contact with the individual "who rightly raised her concerns and have offered her our support".
ABF's share price fell by nearly 4% to £18.64 each after the announcement.
Mr Marchant became chief executive of Primark in 2009, taking over from the firm's founder Arthur Ryan. He previously worked at a number of retailers including Debenhams, Topman, River Island and New Look.
Primark is known for its low-priced clothing and ubiquitous presence on the High Street.
During Mr Marchant's time at the company, Primark has expanded internationally into Europe and the US, where it plans to continue opening stores.
Primark is a key part of the wider ABF business, contributing nearly half of the group's overall sales of £20bn.
However, in its most recent trading update covering the Christmas period, Primark reported a fall in sales for the UK and Ireland, which accounts for 45% of the retailer's revenues.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said Mr Marchant's departure came at a trying time for Primark.
''The change at the top will be unsettling particularly given that Primark delivered a very mixed bag of results at the last count," she said.
"This leadership upset comes amid weaker consumer sentiment which has meant footfall at its stores has fallen - and the chain has been losing market share in the UK.
She said that internationally the company has performed well, but added: "There could be uncertainty ahead about the speed of expansion given the change of boss."
Following Mr Marchant's "immediate" departure, ABF's finance director Eoin Tonge will become Primark's interim chief executive.
The firm's financial controller, Joana Edwards, will step into Mr Tonge's role. The company said: "Both executives have the experience to perform these roles well."
