Ancora Holdings Group, a long-term shareholder of Kohl’s Corporation, has sent a letter to the department store group calling for its chairman, Peter Boneparth, and its CEO, Michelle Gass, to be removed.
The letter, addressed to the company’s board of directors, comes as a response to Kohl’s continued “underperformance” throughout 2021, during which Ancora said it had held back from public critiques in order to provide “Kohl’s time to bounce back from the covid-19 pandemic”.
The firm noted that both Boneparth and Gass had failed to deliver on a productive review of strategic solutions and a viable plan that Kohl’s investors could support.
Ancora went on to state that Kohl’s needed new leadership with the necessary experience, as it claimed that during Boneparth’s 15 years at the company he had also “created an environment in which Ms. Gass is no longer well-positioned to lead”.
Among its complaints against Kohl’s, Ancora highlighted that Kohl’s had produced negative total shareholder returns “over every relevant horizon”, it has had an “unsettling” level of c-suite turnover in recent quarters and it has recently failed to keep up with its competitors.
It further criticised the retailer for awarding Gass nearly 60 million dollars in compensation between fiscal year 2017 and 2021 while it continued to see poor returns.
In conclusion, Ancora said it was urging the board to implement a “thoughtful succession plan” and run a search process involving a diverse group of candidates.
It continued: “Ultimately, Kohl’s needs leadership that can design and implement a precise turnaround strategy to ensure the company averts peril and starts producing enhanced value for shareholders over the long-term.”