Parkrun Global has referred itself to the Charity Commission after discovering that its former chief executive had been receiving secret payments from a supplier.
The charity, which supports the network of Parkrun events around the world, revealed today that Nick Pearson, who left the organisation last month, had struck “an undisclosed and unapproved agreement” in 2018 to receive commissions from a supplier linked to the sport clothing company Contra, a trading subsidiary of Parkrun Global.
The charity opened an investigation into the matter after the new chief executive, Russ Jefferys, identified irregularities while liaising with the supplier, the charity said in a statement.
Parkrun Global did not disclose how much money Pearson had made from the commissions, which were paid to him by a company related to Contra, but said the sums had been repaid. Pearson will also pay for the costs of the charity’s investigation into the matter.
The investigation found that no other staff or trustees were aware of Pearson’s activities, it said.
Shortly after leaving Parkrun Global, Pearson was announced as chair of trustees at the charity GoodGym, which helps runners combine exercise with volunteering, but GoodGym told Third Sector that Pearson would not now join its board.
Asked whether it had been involved with Parkrun’s inquiry, a spokesperson for GoodGym said the investigation was “new information to us”.
Writing on Twitter, Pearson admitted: “I entered into [a] consultancy arrangement that benefitted me financially and represented a direct conflict of interests. I failed to declare this to trustees or my colleagues.” He called it “a huge error of judgement”.
Pearson said he hoped to regain the trust of the people he had let down and said: “I will continue to fully co-operate with Parkrun’s legal representatives where required.”
A Charity Commission spokesperson confirmed that Parkrun Global “has kept us updated on its responses to this matter” and said the regulator was satisfied with how the issue had been handled by trustees.
In his statement to the Parkrun community, Gavin Megaw, chair of Parkrun Global, said: “It is with great disappointment that I must inform you that we have recently found ourselves responding to an incident within the charity that has significantly challenged our trust.
“We discovered that our previous chief executive, Nick Pearson, had an undisclosed and unapproved agreement by which he was receiving a commission from a third party supplier, in regard to the creation of the clothing brand Contra in 2018.
“At no point was this conflict of interest disclosed to the trustees or anyone else involved in Parkrun.
“Our new chief executive uncovered the irregularity when liaising with the third party supplier and reported it immediately to the trustees. The trustees have sought advice from independent professional advisers, including legal and accountancy firms, to ensure that the necessary steps have been taken to deal with the incident and recover the funds.
“Alongside that, the appropriate statutory bodies have been informed.
“The independent investigations have not identified any other areas of concern. Nick Pearson has repaid the funds in full to Parkrun. He has also committed to covering the costs of the investigation.”