Guardian's McCall steps down from Tesco

by Jacquie Bowser, Brand Republic 11-Apr-08, 09:00

LONDON - Carolyn McCall, chief executive of Guardian Media Group, has resigned from her post as a non-executive director of Tesco after the supermarket giant launched a libel lawsuit against the Guardian newspaper last week.

McCall conceded that the legal action had created a "conflict of interest" and said it would be "inappropriate" to remain on Tesco's board.

Tesco is suing Guardian News & Media and its editor Alan Rusbridger for libel and malicious falsehood after the Guardian newspaper published a series of articles and a podcast alleging the supermarket chain had avoided paying corporation tax.

Last week Tesco said The Guardian had wrongly alleged that Tesco was using a tax avoidance structure involving a series of joint venture partnerships held mainly offshore to avoid paying up to £1bn in corporation tax on UK property sales.

Tesco claims it told the newspaper five times before publication that the allegations about it avoiding paying corporation tax were untrue, and has accused the newspaper of not publishing its denials.

McCall said: "It is with regret that I have decided to resign from the Tesco board, but given the clear conflict of interest it would be inappropriate for me to continue in the role."

David Reid, Tesco chairman, said: "It is with regret that I accept Carolyn's resignation from the board. She has been a very good non-executive director and has made a strong contribution to the success of the business."

McCall was appointed as a non-executive director at Tesco in March 2005.

Earlier this week, McCall was named as the Veuve Clicquot Business Woman of the Year at the Berkeley Hotel in London.

Read Gordon's Republic blog post: Tesco/Guardian and decision time for Carolyn McCall.