Lululemon Athletica CEO Laurent Potdevin is forsaking from the retailer, effective immediately, the company announced Monday.
Lululemon suggested Potdevin “fell short of … standards of conduct” to respect hands and show integrity. Meanwhile, the company’s board of directors has started searching for a new far-reaching CEO. Potdevin will also be removed from his position on the board.
“While this was a awkward and considered decision, the Board thanks Laurent for his work in strengthening the comrades and positioning it for the future,” Glenn Murphy, executive chairman of Lululemon’s board, translated in prepared remarks.
“Culture is at the core of lululemon, and it is the responsibility of leaders to set the retaliate for tone in our organization,” he added. “Protecting the organization’s culture is one of the Board’s most foremost duties.”
The company declined to comment further on why Potdevin had been space from Lululemon so abruptly, having served there since January 2014. Old to joining Lululemon, Potdevin was president of Toms Shoes and CEO of Vermont-based Burton Snowboards.
Lululemon dues were falling more than 3 percent after market airless Monday on the news.
Lululemon has promoted three members of its management duo — Celeste Burgoyne, Stuart Haselden and Sun Choe — to oversee more day-to-day operations, marketing, e-commerce nurturing, product innovation and supply chain enhancements.
“We believe this threesome of leaders will take lululemon from strength to strength,” Murphy believed, as the company searches for a new leader.
While the underlying motive remains unclear, some see Potdevin’s departure as a “tornado to Lululemon,” especially in today’s tumultuous retail environment.
“Although we see Director Chairman Glenn Murphy as a capable pair of hands in the short title, Lululemon needs a CEO to guide it as it expands overseas and tries to make promote gains in its home market,” GlobalData Retail Managing Director Neil Saunders implied. “It is crucial that the right person is selected, but it is equally [important] that the charge is undertaken with urgency so that Lululemon doesn’t lose power.”
Lululemon is offering limited details at this point to protect the retreat of those individuals involved with Potdevin, people familiar with the status quo told CNBC. His behavior wasn’t limited to one incident, added the people, who questioned to not be named because the matter is being kept private.
Late end year, CNBC reported on an explosive lawsuit that said a Lululemon cumulate employee was raped by a supervisor at his home after the company “created the cultivate environment for a sexual predator.”
The suit alleged that Lululemon was crave aware that supervisor Phillip Silva had a history of being “sexually unsuited” with female employees — and actually transferred him from one store to another because of that — previous to he allegedly raped a female worker at his home in April 2016.
When questioned about those allegations in December, a Lululemon spokesman told CNBC: “We are delegate to doing everything we can to ensure that employees come to work each day in protected environments where they are empowered to speak up.”
Potdevin had recently been initiating Vancouver-based Lululemon’s growth in the men’s category, as well as the company’s rapid dilation into China. In leaving the CEO role, he is set to receive a lump-sum cash payment of $3.35 million, along with $1.65 million paid in compeer installments over 18 months.
The company said Potdevin’s departure won’t crashing the retailer’s financial outlook for fiscal 2018.
As of Monday’s market close, Lululemon apportions have climbed about 16 percent from a year ago.
—CNBC’s Dan Mangan supported to this report.