Britain’s biggest grocer, Tesco, has hired the City veteran Gerry Murphy as chair to replace John Allan, who stepped down after allegations of inappropriate behaviour. Murphy, who chairs the luxury fashion retailer Burberry and the sugar company Tate & Lyle, is to join Tesco on 1 September, and will relinquish his role at Tate & Lyle at the same time. Allan, who chaired Tesco for eight years, stood down at the retailer’s annual general meeting in mid-June, after the Guardian reported that he allegedly touched the bottom of a senior member of Tesco staff in June 2022, at the company’s AGM. Murphy joins Tesco at a time when supermarkets are under pressure to do more to alleviate the cost of living crisis, amid accusations from politicians and trade unions of “greedflation” – the practice of using high inflation as cover to raise prices further. Byron Grote, who has served as Tesco’s interim chair, said Murphy was “the unanimous choice of the board and will bring to our board a record of strong and effective boardroom leadership and a deep understanding of retail and consumer-focused businesses and corporate governance”. Grote will return to his previous position as senior independent director at Tesco and chair of the audit committee. Murphy has previously worked as chief executive of the B&Q owner, Kingfisher, the media group Carlton Communications, the logistics firm Exel and the Irish food business Greencore Group. Before that, he ran the private equity group Blackstone’s European arm and had his first job at Bank of Ireland as a bank assistant. He also founded, and later sold, several businesses, including Great Gas Petroleum. The Irish businessman, 69, paid tribute to Allan, whom he has known for many years, saying he had left Tesco “with its business, management and board in great shape and fit for the future”. Four allegations about Allan emerged during the Guardian’s investigation into the Confederation of British Industry, the UK’s biggest business lobbying group. Allan was president of the CBI between 2018 and 2020 and then vice-president until October 2021. He has denied three of the four claims made against him. As well as the allegation relating to Tesco, it was also claimed he touched the bottom of a member of staff at the CBI during its annual dinner in May 2019, when he was the organisation’s president. Allan has also stepped down as the chair of the housebuilder Barratt Developments, which said this would prevent the impact of the allegations against him “from becoming disruptive to the company”. Barratt said it had not received any complaints about Allan during his tenure at the builder.