Methodist fund wrote to Ted Baker about harassment allegations | Business

The clothing brand Ted Baker has come under fire from the Methodist church over the harassment scandal that forced the company’s founder, Ray Kelvin, to take a leave of absence.

Epworth, a fund manager owned by the Methodist church, wrote to Ted Baker last month to demand an investigation into the allegations against Kelvin after 300 former and current staff signed an online petition complaining about behaviour including “forced hugs” and “ear kissing”. The claims are now the subject of an independent investigation led by a City law firm.

Epworth owns a small stake in Ted Baker and is said to have urged swift action, including changes to the corporate culture, if wrongdoing was unearthed.

On its website the fund, which has £1.4bn of assets under management, says it aims to ensure that its investments are “consistent with the Christian faith and that it seeks to use its “influence to improve ethical standards in the businesses we invest in. We ask ourselves if the companies we are investing in are sustainable and operating in a way that is to the benefit of all stakeholders, including wider society.”

The Ted Baker controversy came to light in early December when a petition appeared on the employee campaigning platform Organise. The petition called for an end to the alleged behaviour, saying: “It is part of a culture that leaves harassment unchallenged.”

Until the Observer reported the allegations, Kelvin’s hugs were accepted as part of a quirky culture at Ted Baker’s London head office, according to current and former employees. But staff of both sexes have now accused Kelvin of ear kissing, shoulder massages and asking young female employees to sit on his knee.

After several days of allegations the company brought in the law firm Herbert Smith Freehills to lead an investigation. Organise said it had sent about 100 anonymised reports of alleged harassment to the Ted Baker board. Herbert Smith will report back to a committee of Ted Baker’s non-executive directors.

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Kelvin, who owns a 35% of the listed company, initially tried to continue in the role of chief executive but agreed to take a voluntary leave of absence after the company’s board was made aware of “further serious allegations”.

The 63-year-old opened the first Ted Baker store in Glasgow in 1988 and, 30 years on, it has 544 outlets worldwide and annual sales of £590m. Kelvin released a statement in which he said the accusations were “very serious and upsetting” and that it was “only right” they should be investigated.

He added: “Ted Baker has been my life and soul for 30 years. I love this company and I care deeply for all my colleagues. Ted Baker means everything to me and I can’t bear to see it harmed in any way.”

Ted Baker and Epworth declined to comment on the letter.

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