Woolworths is under renewed pressure to quit its controversial pubs and pokies business, with one of its biggest shareholders urging the supermarket giant to get out of gambling to protect its reputation.

Woolworths owns a majority stake in Australia's biggest slot machine operator, ALH Group, making the retailer a target for anti-gambling campaigners. ALH Group has more than 12,000 pokie machines across its 323 pubs and clubs.

A major Woolworths investor has told the supermarket to exit its pubs and poker machine business. Credit:Janie Barrett

The Sydney Morning Herald and The Age can reveal that pressure has been mounting from one of Woolworths' most influential shareholders, Perpetual Investments, which has told the company's board it should ditch its pokie machines.

The investment powerhouse, which manages a $27.4 billion portfolio, had repeatedly told the Woolworths board that pokie machines are incompatible with the supermarket's expressed values and were a threat to its brand and reputation in the community, sources close to those discussions said.