Kohl's abruptly terminated CEO Ashley Buchanan this week, just four months into his tenure, following an internal investigation that revealed he directed the company to enter into undisclosed vendor transactions involving a former romantic partner, according to people familiar with the matter and company disclosures. The department store chain characterized the dismissal as "for cause," citing "unethical conduct" that violated corporate policies.
The company said the termination is unrelated to financial performance, operations, or any other employees. Buchanan, who began as CEO on January 15, was fired after the board's audit committee reviewed findings from an external investigation. The committee found he had engaged in vendor relationships that involved "undisclosed conflicts of interest."
Kohl's did not name the vendor, but a Wall Street Journal report identified the party as Chandra Holt, a former Walmart colleague of Buchanan's and the current CEO of Incredibrew, a coffee startup. Holt acknowledged knowing Buchanan for a decade but told the Journal, "I have not received any compensation for my Incredibrew business from Kohl's."
The consulting contract in question was reportedly worth millions and contained unusually favorable terms. Holt and Buchanan each held high-ranking roles at Walmart before departing around the same time. Holt later served as CEO of Conn's HomePlus and then Beyond Inc., the parent of Overstock.com and Bed Bath & Beyond.
Buchanan's ouster makes him the third Kohl's CEO in as many years, succeeding Tom Kingsbury and Michelle Gass. Kohl's appointed board chair Michael Bender as interim CEO, effective immediately. Bender has served on the board since July 2019 and became chair in May 2024.
Kohl's shares rose nearly 8% on the news, closing at $7.09. Analysts said the removal eliminates a leadership distraction as the company confronts continued sales declines and store closures.
In securities filings, Kohl's disclosed that Buchanan will forfeit all equity grants and must return a prorated portion of a $2.5 million signing bonus. Preliminary results for the first quarter showed comparable sales down between 4% and 4.3%, underscoring the company's ongoing struggles amid broader headwinds in retail.
"While the sacking is not related to performance, it gives the impression that Kohl's is in perpetual state of chaos," Neil Saunders, managing director at GlobalData Retail, said in a note. "it raises some questions about the due diligence over his appointment."
Kohl's, based in Menomonee Falls, Wisconsin, operates about 1,100 locations and recently announced plans to close 27 stores as it contends with shifting consumer behavior and inflation-driven spending cutbacks.
