1st Feb 2006 09:30
Compass Group PLC01 February 2006 Compass Group PLC: Conclusion of Freshfields Investigation 1 February 2006 Compass Group PLC announces that the investigation undertaken by Freshfields,assisted by Ernst & Young, into the relationships between its subsidiary, EurestSupport Services (ESS), IHC Services (IHC) and the United Nations (UN) has nowconcluded. The investigation has been overseen by Steve Lucas, the Chairman of CompassGroup's Audit Committee, and has lasted 3 months, involving an extensive andhighly detailed review of documents and emails and intensive interviews withrelevant individuals. The key findings and recommendations of this investigationhave been presented to the Compass Group PLC board and are as follows: •The investigation has established serious irregularities in connection with contracts awarded to ESS by the UN. •There were issues in relation to the behaviour of a few individuals within ESS. •The considerable work undertaken by Freshfields and Ernst & Young gives no reason to believe that these issues extend beyond these individuals to other parts of ESS or to the wider Compass Group of companies. •Compass Group does not own, and has never owned, any shares in IHC. The Board has taken the following actions arising from this investigation: •Action has been taken in respect of those individuals accountable within ESS, including dismissals where appropriate. •The senior management of ESS has been completely restructured and now reports to Andrew Martin, Group Finance Director. •Compass Group has reviewed, with Ernst & Young, the systems and controls within ESS in the light of the issues raised by this investigation and is implementing changes including reducing the level of autonomy within the business and increasing central controls. IHC's relationship with the UN and ESS is part of wider and on-goinginvestigations into UN procurement activity being conducted by the Office of theUnited States Attorney for the Southern District Court of New York, the UnitedStates Congress and the UN itself, and with which Compass Group is fullycooperating. As these matters are the subject of criminal investigation in theUnited States, it would be inappropriate at this time for the Group to make anyfurther comment. Steve Lucas, Chairman of the Audit Committee of Compass Group, said: "This has been a highly regrettable episode for Compass Group. However, we havenow concluded a very thorough investigation and taken appropriate and decisiveaction. We have no reason to believe that the issues identified extend to anyother part of the Group. The Board is determined that Compass Group should meetthe highest ethical and governance standards and is taking all necessary stepsto ensure that this is the case." Enquiries: Compass Group PLCShareholders/Analysts Andrew Martin 01932 573000Media Paul Kelly 01932 573000 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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