Guardian Media Group chief executive Carolyn McCall has resigned as a director of Tesco, following the supermarket giant's decision to take legal action against the Guardian.
McCall announced today she has resigned as a non-executive director of Tesco, to avoid 'a conflict of interest'in a legal action by Tesco against the Guardian and its editor, Alan Rusbridger.
She said: 'It is with regret that I have decided to resign from the Tesco board, but given the clear conflict of interest it would be inappropriate for me to continue in the role."
Tesco began legal proceedings against the Guardian last Friday for libel and malicious falsehood over allegations made by the newspaper concerning the supermarket's tax affairs.
Tesco said that Guardian articles and a podcast wrongly alleged that the supermarket had arranged a series of joint ventures partnerships largely held offshore to avoid paying up to £1 billion in coporate tax on the sale of its UK properties.
The supermarket also said the Guardian wrongly alleged it had already used this type of tax avoidance structure to avoid paying £500 million in corporation tax in two property deals.
Tesco said it repeatedly told the Guardian the allegations were wrong and all profits from the transactions were included in Tesco's UK tax returns.
The Guardian accused the retailer of bullying tactics and attempting 'to chill public debate'on tax avoidance. The newspaper said it did not accuse Tesco of acting illegally at any point but that its actions had raised questions of public interest which the newspaper repeatedly asked the retailer to clarify prior to publication.