Kohl’s is back in crisis mode, and this time, it’s not because of sales, On May 1, the struggling retailer made headlines after abruptly firing CEO Ashley Buchanan, just four and a half months into his tenure.
The reason? Unethical behavior tied to undisclosed conflicts of interest in vendor transactions. According to a company statement, Buchanan’s actions violated internal policies, triggering a “for cause” dismissal, one of the most serious exits a CEO can face in corporate America.
What Did Ashley Buchanan Do?
Kohl’s brought in external counsel to investigate Buchanan’s conduct, which allegedly involved directing the company to engage in vendor deals where he had undisclosed ties or benefits. While details of the vendors or specific deals have not been made public, Kohl’s made it clear: this was a serious breach of trust.
Importantly, the company emphasized that Buchanan’s firing is not related to financial performance, accounting irregularities, or other employees. But the damage to perception? That’s a different story.
A Short, Rocky Tenure
Buchanan, previously the CEO of Michaels, took over the reins at Kohl’s on January 15, 2025, with the mission to engineer a turnaround. But he struggled to gain traction. Just last month, Kohl’s reported sales slumping by as much as 4.3% in preliminary earnings, hardly the revival the board was hoping for.
His departure adds yet another layer of instability to a company that’s been whiplashed by leadership shakeups, strategy pivots, and store closures. Analysts have been quick to note that Kohl’s looks like a company stuck in perpetual chaos.
Industry Reaction: “A Blow Upon a Bruise”
Retail analyst Neil Saunders of GlobalData Retail didn’t mince words. “While the sacking is not related to performance, it gives the impression that Kohl’s is in a perpetual state of chaos,” he said. “It raises some questions about the due diligence over his appointment. It’s a blow upon a bruise.”
Ouch.
What’s Next for Kohl’s?
Chairman Michael Bender has stepped in as interim CEO, while the board searches for a permanent replacement. In a twist of irony, Buchanan’s removal actually boosted investor confidence, with Kohl’s (KSS) stock jumping as much as 8% after the announcement. Investors seem relieved that the board acted decisively, especially in a time when Kohl’s desperately needs stability.
But the challenges ahead are steep:
- Changing consumer behavior has hit department stores hard
- E-commerce competition continues to erode in-store traffic
- Inflation and tighter wallets are stifling spending
- Kohl’s recently closed 27 stores, leaving it with just 1,100 locations
In short, the company has little room left for missteps.
The Bigger Picture
Kohl’s firing Buchanan for unethical behavior shines a light on the importance of corporate governance and transparency, especially at a time when retailers are fighting tooth and nail to survive.
While the board insists this scandal is isolated, it raises a fair question: How did someone with potential conflicts of interest slip through the cracks of vetting and due diligence? And more importantly, can Kohl’s rebuild trust with its shareholders, customers, and employees?
