Menomonee Falls, Wisconsin — Kohl’s announced this week the termination of CEO Ashley Buchanan following revelations of a personal relationship that created a conflict of interest with a vendor linked to a significant consulting deal. The retailer reported the decision in a regulatory filing, stating that an investigation uncovered violations of company policy regarding undisclosed conflicts.
Buchanan, who had been at the helm since January, guided the company to enter into transactions that involved terms not typically granted to vendors, raising ethical concerns. The board’s decision to terminate him for cause was based solely on this matter and not related to the chain’s overall performance or any other employees.
The investigation, conducted by an external law firm, found that Buchanan failed to disclose his relationship with a vendor founder, who was also part of a team that struck a multimillion-dollar agreement. This led to an unfavorable relationship with regulatory practices intended to uphold transparency within the company.
In light of the evidence uncovered, the company’s board appointed director Michael Bender as interim CEO. The filing indicated that Buchanan would also have to forfeit equity awards and bonuses, including a $2.5 million signing bonus, as part of the fallout from this incident.
Initial reports suggest the consulting firm involved was the Boston Consulting Group, where Buchanan’s partner, Chandra Holt, served as an advisor. The group expressed surprise at the nature of their relationship and has since ended Holt’s contract due to nondisclosure of the conflict.
Boston Consulting Group clarified that Holt, recognized for her industry expertise, was hired on a part-time basis and worked hourly. They emphasized that she had no role in contract negotiations for the project associated with Kohl’s.
As the retailer navigates these challenges, analysts will be closely watching how the leadership change affects the company’s strategic direction and operational integrity moving forward.