Lululemon fired back at founder Chip Wilson on Monday in a shareholder letter, calling his perspectives “outdated” and his conflicts of interest “troubling,” and urging investors to reject the three board nominees he has put forward ahead of the company’s June 25 annual meeting.
Settlement negotiations broke down last week, prompting Lululemon to go public with what marks its first significant response to Wilson since his proxy campaign intensified at the end of last year, according to Reuters
According to Lululemon, it held off on submitting its definitive proxy filing while pursuing a negotiated resolution, only for Wilson to respond with terms the company described as “a significant departure from what had been discussed.” Wilson had demanded the appointment of three directors of his choosing, quarterly meetings with the incoming CEO, and full reimbursement of his campaign costs. Lululemon rejected the terms. The shareholder letter included pointed criticism of Wilson’s grasp of the company’s current position: “Mr.
Wilson has shown that he does not have a full understanding of the business today or the brand’s future potential and remains intractably focused on the past. His vision for Lululemon appears to be frozen in time, viewing Lululemon through the lens of a founder who has been outside the boardroom for over a decade and away from any operating responsibility within the company for nearly 15 years.” Since departing the chairmanship in 2013 — a role he held after founding the company in 1998 — Wilson has repeatedly targeted Lululemon’s board and argued the brand has shed the cultural cachet that once defined it. He nominated three directors — former ESPN CMO Laura Gentile, former Activision CEO Eric Hirshberg, and former On co-CEO Marc Maurer — arguing the company needs more creative leadership.