Target CEO Gregg Steinhafel to step down immediately

Target CEO Gregg Steinhafel to step down immediately

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MINNEAPOLIS (KMSP) - Target Corp. chief executive officer Gregg Steinhafel will immediately be stepping down from his post. Chief financial officer John Mulligan has been named interim chief executive.

Steinhafel, a 35-year Target employee at CEO since 2008, is resigning in the wake of a giant malware attack that compromised the credit and debit card information of 40 million customers. Personal information for an additional 70 million customers is also believed to have been compromised.

Mulligan, a Target employee since 1996, has been CFO for just a few years, and was the one to testify before the U.S. Senate Judiciary Committee about the breach in February -- the first time Target publicly answered questions about the attack.

In a letter to Target's Board of Directors, Steinhafel cited other challenges during his tenure, including the recession and a struggling 127-store expansion into Canada.

"We have already begun taking a number of steps to further enhance data security, putting the right people, processes and systems in place. With several key milestones behind us, now is the right time for new leadership at Target," the letter reads.

BOARD OF DIRECTORS STATEMENT

“Today we are announcing that, after extensive discussions, the board and Gregg Steinhafel have decided that now is the right time for new leadership at Target. Effective immediately, Gregg will step down from his positions as Chairman of the Target board of directors, president and CEO. John Mulligan, Target’s chief financial officer, has been appointed as interim president and chief executive officer. Roxanne S. Austin, a current member of Target’s board of directors, has been appointed as interim non-executive chair of the board. Both will serve in their roles until permanent replacements are named. We have asked Gregg Steinhafel to serve in an advisory capacity during this transition and he has graciously agreed.

The board is deeply grateful to Gregg for his significant contributions and outstanding service throughout his notable 35-year career with the company. We believe his passion for the team and relentless focus on the guest have established Target as a leader in the retail industry. Gregg has created a culture that fosters innovation and supports the development of new ideas. Under his leadership, the company has not only enhanced its ability to execute, but has broadened its strategic horizons. He also led the company through unprecedented challenges, navigating the financial recession, reacting to challenges with Target’s expansion into Canada, and successfully defending the company through a high-profile proxy battle.

Most recently, Gregg led the response to Target’s 2013 data breach. He held himself personally accountable and pledged that Target would emerge a better company. We are grateful to him for his tireless leadership and will always consider him a member of the Target family.

The board will continue to be actively engaged with the leadership team to drive Target’s future success and will manage the transition. In addition to the appointments of the exceptional leaders noted above, we have also retained Korn Ferry to advise the board on a comprehensive CEO search.

The board is confident in the future of this company and views this transition as an opportunity to drive Target’s business forward and accelerate the company’s transformation efforts.”

NOT THE FIRST RESIGNATION

Steinhafel is not the first to step down as the company attempts to recover from the breach that hit during holiday shopping season high tide -- Target Corp. announced in March that chief information officer Beth Jacob would step down. The company is working with Promontory Financial Group, to evaluate its technology, structure, processes and talent as part of the overhaul, the Associated Press reported.

NEW SMART-CHIP READERS

Target announced in late March it will install chip-enable card readers in all stores by September. The retailer had already installed 10,000 devices in 325 stores nationwide, but the Minneapolis-St. Paul Business Journal said the company now aims to have all stores outfitted six months ahead of the original deadline.
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