AN ONLINE fashion retailer and major East Lancashire employer is reportedly considering linking multimillion pound bonuses received by executives to how they improve workers' rights.

According to Reuters, Burnley-based Boohoo founder Mahmud Kamani told MPs on Saturday that the firm was considering plans which would see bonuses linked to 'environmental and social governance' (ESG) improvements, including better pay and conditions for workers and more environmentally friendly ways of working.

This comes after a series of revelations last year which found that a number of factories in Boohoo's supply chain were paying workers less than the minimum wage and requiring them to work under unsafe conditions during the height of the coronavirus pandemic with one such factory described by an independent investigator as having “the worst working conditions that I have seen in the UK."

EAC chairman Philip Dunne MP said: “Boohoo’s response to our committee’s letter sends promising signals that we are reaching a turning point in fast fashion’s awareness of its environmental and social responsibilities.

“It is welcome news that the board is considering aligning senior executive bonuses with making ESG improvements, and I look forward to hearing whether this is being taken forward."

The recommendations were first made by the House of Commons committee in a letter to Boohoo following an evidence session in December, attended virtually by company founder Mahmud Kamani and executives.

During the December session, Mr Kamani told executives that he would address the low pay and poor conditions in his company's supply chain.

Since then, Boohoo, which maintains a major distribution hub on Heasandford Industrial Estate, Widow Hill Road in Burnley, has ceased business with over 400 supply chain companies.

However, the company also faced criticism last year for the timing of its bonus scheme, which would pay out up to £150 million pounds to its founders and top executives if Boohoo's share price rose 66 per cent over three years from June 2020.

Mr Kamani and co-founder Carol Kane could each have been in line for £50 million, with Mr Kamani’s son Samir, who is CEO of BoohooMan, in line for £25 million, while chief financial officer Neil Catto could end up with a bonus of £10 million.

Mr Dunne said: “Bonuses shouldn’t just be linked to breakneck growth.

"Boohoo needs to demonstrate that it is delivering verifiable improvements in workers’ rights and the climate impact of its products."

In response, Boohoo has now said that it is considering the new bonus proposals with shareholders.