Marks & Spencer in danger of 'red top' punishment from investors

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Marks & Spencer could face the ignominy of a "red top" warning from the Association of British Insurers if it fails to provide a full explanation for the elevation of Sir Stuart Rose to executive chairman.

F&C has become the latest investor to go public with its disquiet at Sir Stuart's promotion. Best corporate governance practice says companies should separate the roles of chairman and chief executive.

The ABI has already said it plans to put the retailer on "amber alert". However, it is understood that a continued failure to provide a proper explanation for the move could place M&S in the "red" category, reserved for the most serious corporate governance breaches.

George Dallas, F&C's head of corporate governance, said: "Our position is not very different from many of the other investors who have expressed concern."

M&S claims 50 per cent of its shareholders are "broadly supportive". But Legal & General, Schroders and AXA have already publicly voiced their disquiet.