The co-founders of Bed Bath & Beyond (BBBY) will retire from the company’s board as part of the home goods retailer’s overhaul of its directors as it seeks to bolster diversity.
Bed Bath & Beyond will also form a business transformation and strategy review committee and reconstitute its audit and compensation committees, according to a statement on Monday. Five independent directors will step down and five others will be appointed, with effect from May 1.
“The board has been undertaking a comprehensive review of its composition, governance structure and compensation practices,” said Patrick Gaston, the current lead independent director who becomes independent chairman. “The changes announced today reflect a significant shareholder input and underscore our commitment to ensuring we have best-in-class governance.”
The changes come after the Union, NJ-based retailer said earlier this month sales fell 11% to $3.3 billion in its fiscal fourth quarter, with comparable-store sales falling 1.4%.
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Bed Bath & Beyond said on Monday it’s had “multiple discussions” with members of a group of activist shareholders including Legion Partners, Macellum Capital Management and Ancora Advisers. The company said they’ve sought their participation in the board changes and “to offer their ideas for business and operational improvement,” but the invitation has been declined.
Warren Eisenberg and Leonard Feinstein will become “co-founders, co-chairmen emeriti” of the company they headed as co-chief executives from 1971 to 2003, the retailer said. Dean Adler, Stanley Barshay, Klaus Eppler, Jordan Heller and Victoria Morrison will step down from the board.
The new directors will be comprised of nine independent directors out of a total of 10 members, and six of them are women. The average tenure will be less than four years.
New members include Harriet Edelman of Emigrant Bank, Harsha Ramalingam of Boston Consulting Group, Andrea Weiss who has had executives role at The Limited, Ann Taylor and Walt Disney (DIS); Mary Winston who was chief financial officer at Family Dollar and Ann Yerger, a corporate governance specialist.