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Laurent Potdevin, CEO of Lululemon Athletica Inc., speaks at the Alibaba Gateway Conference in Toronto, Ontario, Canada September 25, 2017. REUTERS/Mark Blinch - RC134A0EBD00
Reuters/Mark Blinch
Lululemon’s now-former CEO, Laurent Potdevin.
EFFECTIVE IMMEDIATELY

Lululemon’s CEO has resigned after falling short of its “standards of conduct”

By Marc Bain

Laurent Potdevin, Lululemon’s CEO since 2014, is out as chief executive and as a board member, after he ”fell short” of Lululemon’s standards of conduct, the company has announced. His resignation is effective immediately.

The company has already begun a search for Potdevin’s replacement. In the meantime, three of its senior leaders will take on expanded roles and report to Glenn Murphy, executive chairman of the board.

Lululemon hasn’t released details on how Potdevin violated its standards of conduct. In a statement, it said it “expects all employees to exemplify the highest levels of integrity and respect for one another,” and that’s where Potdevin came up short. The company did not share any comments from him.

One person familiar with the situation told Quartz there was no single incident that led to Potdevin’s resignation, but rather a variety of instances where he was said to have shown a lack of leadership.

Murphy, meanwhile, thanked Potdevin for his work, and added, ”Culture is at the core of Lululemon, and it is the responsibility of leaders to set the right tone in our organization. Protecting the organization’s culture is one of the Board’s most important duties.”

The company has been caught in some leadership debacles in the past. In 2013, the year before Potdevin became CEO, it had to recall one style of its yoga pants because they were see-through. Chip Wilson, one of Lululemon’s cofounders, said the pants didn’t work “for some women’s bodies.” Wilson later resigned his role as chairman of the company’s board of directors, and then resigned from the board entirely in 2015.

Lululemon says it doesn’t expect Potdevin’s departure to hurt its business. Lately the company has been thriving, despite fears from investors that the market for activewear might be cooling off. It has continued to find customers for its pricey yoga clothes, though, and on Jan. 8 even raised its financial outlook for the quarter. In its statement announcing Potdevin’s resignation, it reaffirmed its outlook, and said the company’s growth plan is still on track to reach $4 billion in annual sales by 2020.