Sir Stuart Rose, chief executive of Marks & Spencer, will sell his £100,000 stake in Martha Lane Fox’s karaoke business in an effort to defuse a row over boardroom standards.

Institutional investors have expressed concern that Ms Lane Fox, an independent director at M&S, might be compromised by the investment, although there was no suggestion of any impropriety.

The neutrality of the nonexecutive directors is highly sensitive because of Marks & Spencer’s plan to elevate Sir Stuart to the additional role of chairman, augmenting his power.

Sir Stuart said yesterday that the disposal was not really necessary. “She is a very independent-minded woman. She doesn’t suffer fools. She’s not the sort of character who would be swayed by a £100,000 investment.”

However, he went on to reveal in a speech to the Society of Investor Relations: “I have in fact unwound my investment in Lucky Voice [the karaoke business]. Perhaps I should have called it Unlucky Voice,” he quipped.

Sir Stuart later told The Times: “I didn’t want to look arsey and so intransigent that I wasn’t listening to what people were saying. You have to look whiter than white.” He said the transaction had not been completed, so it was not possible to say whether he would make a profit or loss.

The Association of British Insurers, which raised concerns over the commercial relationship between Ms Lane Fox and Sir Stuart, welcomed the planned disposal. Peter Montagnon, investment director of the ABI, said, “It is good and sensible that this has been addressed.”

Until yesterday, Sir Stuart said his investment in Lucky Voice was a private matter. Ms Lane Fox is best known as the co-founder of lastminute.com, the darling of the technology boom.

Sir Stuart also told the conference yesterday that he had not anticipated the extent of the row over his elevation. If he were to do it again, he would consult shareholders first. He said: “We’ve certainly got the right checks and balances now in place.”

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