Kohl's CEO fired after investigation uncovers alleged conflicts of interest
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The CEO of Kohl's was fired after the company's board said he violated conflict-of-interest standards by inappropriately directing business to someone with whom he had a "personal relationship."
Why it matters: The struggling department store chain has had significant turnover in the C-suite as it tries to reinvent itself amid three straight years of sales declines.
Driving the news: Kohl's said Thursday morning that CEO Ashley Buchanan had been terminated after less than four months on the job.
- "An investigation conducted by outside counsel and overseen by the Audit Committee of the Board determined Mr. Buchanan violated company policies by directing the Company to engage in vendor transactions that involved undisclosed conflicts of interest," Kohl's said in a statement.
- In an SEC filing, the company said the arrangement involved "highly unusual terms favorable to the vendor" and that Buchanan also "caused the Company to enter into a multi-million dollar consulting agreement wherein the same individual was a part of the consulting team."
- He did not disclose the relationship, as the company required in its ethics code, according to Kohl's.
- The retailer added that his firing was "unrelated to the Company's performance, financial reporting, results of operations and did not involve any other Company personnel."
Buchanan, a past CEO of Michaels, became CEO of Kohl's in January as the company seeks a turnaround.
- The retailer reported Thursday that it expects its first-quarter comp sales to fall in a range of 4% to 4.3%.
What's next: Kohl's board member Michael Bender was named interim CEO while the company searches for a permanent replacement.
- He becomes the fourth person to serve as permanent or interim CEO of Kohl's in less than three years.
- Bender is a past CEO of optical retailer Eyemart Express and a past executive at Walmart, where he served as chief operating officer of global ecommerce.
The other side: Buchanan could not be immediately reached for comment.
Editor's note: This story has been updated with details from the company's regulatory filing.
