Compass moved to shore up its faltering credibility on Friday by suspending a senior executive while it conducts an investigation into how a subsidiary of the food services group won a contract to supply the United Nations.
Shares in the group, which have fallen nearly 10 per cent since revelations about the investigation surfaced at the beginning of the month, fell as much as 9 per cent in morning trade. By midday on Friday they were down 3.6 per cent at 179p.
Peter Harrishead of the UK, Ireland, Middle East and Africa regions, has been suspended following the revelation earlier this month that Eurest Support Services is assisting a wide-ranging investigation into how the subsidiary won a contract to supply UN peacekeepers in Liberia.
Compass said on Friday it had appointed Freshfield Bruckhaus Deringer, the international law firm, to conduct an investigation into the relations between ESS, IHC Services - a company that provides products and services to UN contractors including Compass - and the UN.
The company gave no indication of how long the investigation would take but said Gary Green, head of the Americas region, will take over Mr Harris’s responsibilities while the inquiry is carried out.
The appointment of Freshfield escalates the investigation which centres around allegations that a Compass employee came into the possession of financial details of bids made by competing companies before a contract to supply food and water to UN peacekeepers in Liberia had been awarded. ESS subsequently won the contract.
In the closed tendering process used at the UN, details of bids are privileged information and circulation of the information outside a small group of UN officials is forbidden.
ESS, which supplies UN peacekeepers in trouble spots around the world including Kosovo, Cyprus and Lebanon, had been a rare success for Compass, which has seen its traditional business of supplying schools and offices struggle.
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