In Push for a Turnaround at Kohl’s, Investor Group Nominates Nine Board Directors


Four Kohl’s investors representing nearly 10% of the retailer’s outstanding common stock have nominated a slate of nine independent candidates for the retailer’s Board of Directors. Their goal is to shake up the board and alter the company’s current trajectory. Macellum Advisors GP, Ancora Holdings, Legion Partners Asset Management and 4010 Capital, together with their respective affiliates, are pushing the plan.

The investor group, which holds approximately 9.5% of the stock, highlighted the reasoning for its nominations in a letter. Some of the complaints included:

  • “Poor retail execution and strategy leading to stagnant sales and declining operating margins.” The investor group noted that Kohl’s operating income margins declined from 11.5% in 2011 to 6.1% in 2019, and that the retailer earned about 44% less in 2019 than it did in 2011 despite similar total sales and $6.6 billion in cumulative capital expenditures.
  • “A long-tenured board with insufficient retail experience.” Kohl’s added a new director in February 2021, but prior to that the board’s average tenure was approximately 10 years. The investor group also believes the board lacks alignment with shareholders’ interests.
  • “Excessive executive compensation and poor alignment between pay and performance.” From 2010 to 2019, Kohl’s top five executives have increased their total compensation from $20 million to $30 million, according to the investor group.
  • “Systemic inability to achieve stated goals.” Kohl’s announced a “Greatness Agenda” in 2013, which called for $21 billion in sales and $1.9 billion in operating profit by 2017. The targets were missed by 9% and 25%, respectively.

The investor group claims to have “identified significant opportunities to generate improvements in sales and margins through changes in merchandising, inventory management, customer engagement and expense rationalization, as well as the potential to unlock $7 to $8 billion of real estate value trapped on the company’s balance sheet.” The firms want the proposed new directors to push its turnaround plan.

Kohl’s has been working on its own strategy to improve operations and has been in contact with the investors for several months. Like many of its peers, the retailer was struck hard by the impact of the coronavirus pandemic, which led to laying off 15% of its corporate staff after a challenging Q2 2020.


“The Kohl’s Board and management team have been engaged in discussions with the investor group since early December and we remain open to hearing new ideas,” said Kohl’s in a statement emailed to Retail TouchPoints. “Kohl’s is deeply committed to enhancing shareholder value and is confident the company’s new strategic framework, published in October 2020, will accelerate growth and profitability. Since we published the new strategy, Kohl’s has received seven equity analyst upgrades and our stock price has appreciated more than 150%.”

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