THE boss of fashion chain Ted Baker – who spoke of the company’s “hug culture” in Bournemouth just days before an investigation was launched into his behaviour last year – has resigned.

Ray Kelvin stood down with immediate effect following allegations of harassment.

His speech to an audience of entrepreneurs in Bournemouth turned out to be his last as chief executive of the retailer. 

Mr Kelvin, who also founded the retailer, began a leave of absence shortly afterwards, following claims “enforced” hugs at the business. Accusations were also made that he massaged employees, kissed their ears and asked some to sit on his lap.

Mr Kelvin denies all allegations of misconduct, but Ted Baker said he agreed to resign as chief executive and director.

The businessman, who has been fond of Bournemouth since childhood holidays in the resort, spoke at a Virgin StartUp event in the town last November.

On that occasion, he urged everyone in a 200-strong audience to hug the person next to them.

He told a previous event in Bournemouth that the business had a “hug culture”, with hugs instead of handshakes. He said the idea arose out of a rheumatic complaint which made it painful for him to shake hands.

Alex Chisnall, who organised Mr Kelvin’s speeches to local entrepreneurs, said: "I don't think any of us who who attended Ray Kelvin speaking at This Workspace last November thought we'd be witnessing his last public appearance as Ted Baker CEO.

"When the news broke the following day about the allegations, you couldn't help but think that would be the beginning of the end for him in that role. By resigning he's clearly giving the business the best chance to focus on what it does best as a global fashion brand."

Executive chairman David Bernstein said on Monday: "Ray Kelvin founded the business 32 years ago and has, together with the fantastic team around him, been the driving force behind it becoming the global brand it is today.

"As founder and CEO, we are grateful for his tireless energy and vision. However, in light of the allegations made against him, Ray has decided that it is in the best interests of the company for him to resign so that the business can move forward under new leadership."

Mr Kelvin himself said that stepping away is the "right thing to do".

He said: "The past few months have been deeply distressing and I'll now be taking time privately with my family to consider what my next adventure will be. Bye for now, Ray."

An internal independent committee has been in the process of investigating the allegations alongside law firm Herbert Smith Freehills.

The probe will continue, with the primary focus now on Ted Baker's policies, procedures and handling of complaints.

Acting chief executive Lindsay Page has agreed to continue in the role, with Mr Bernstein providing additional support in an executive capacity until no later than November 30 2020, by which time a successor will be appointed.

Mr Bernstein added: "As a board of directors, we are committed to ensuring that all employees feel respected and valued. We are determined to learn lessons from what has happened and from what our employees have told us and to ensure that, while the many positive and unique aspects of Ted's culture are maintained, appropriate changes are made.”