Kohl’s Corporation has made headlines with the recent termination of CEO Ashley Buchanan, effective April 30. The decision follows an external investigation that revealed he had breached the company’s conflict-of-interest policies.

Grounds for Termination

The investigation found that Buchanan directed the company to engage in transactions involving undisclosed conflicts of interest. Specifically, a regulatory filing indicated he had conducted business with a vendor with whom he maintained a personal relationship. This connection was not disclosed, in violation of Kohl’s code of ethics.

As a result of his dismissal, Buchanan will forfeit his equity awards and must repay a pro-rated portion of his $2.5 million signing bonus.

Impact on Company Shares

Following news of Buchanan’s termination, the company’s shares saw a notable increase, rising by 7.5% to $7.20 during late morning trading.

Context of Buchanan’s Leadership

Buchanan’s tenure as CEO began on January 15, with the objective of revitalizing Kohl’s amid sluggish sales and increasing competition from major retailers like Walmart and Amazon. The company’s current challenges are compounded by economic pressures, causing middle-income shoppers to reduce discretionary spending.

Despite his short time in the role, the statement from Kohl’s clarified that his termination was not linked to the company’s financial performance or operational results.

Appointment of Interim CEO

In light of Buchanan’s exit, Kohl’s has appointed Michael Bender, the current board chair, as the interim CEO. Bender expressed his commitment to leading the company during this crucial period.

Background on Ashley Buchanan

Before joining Kohl’s, Buchanan was the CEO of Michaels Companies and held various senior leadership positions at Walmart and Sam’s Club, highlighting his extensive experience in the retail sector.