A Lululemon store in Austin, Tex., in June. Lululemon stock has dropped 43 per cent since the start of 2025.Brandon Bell/Getty Images
Lululemon Athletica Inc. LULU-Q founder Chip Wilson is launching a proxy fight to overhaul the board of the athletic apparel company as it deals with mounting competitive pressure, a near-halving of its stock price and the impending departure of its chief executive.
On Monday, Mr. Wilson nominated three new directors to the board, calling the lack of clear CEO succession planning a “total failure of board oversight,” and insisting that the next chief executive appointment should take place only after significant changes to its membership.
At the same time, he submitted a governance structure proposal that, if passed, would see each board member face a shareholder vote every year.
“It is clear to the world that Lululemon is special, but in need of change,” Mr. Wilson said in a press release Monday. “Lululemon needs visionary creative leadership to thrive. The simple truth is that the current board lacks these skills.”
Elliott Investment takes $1-billion stake in Lululemon, pushes for new CEO
Why is Lululemon CEO Calvin McDonald stepping down?
Lululemon stock has dropped 43 per cent since the beginning of the year. The Vancouver-based athleisure brand has struggled to compete with fresh labels entering the market it once dominated.
In early December, Lululemon said that its CEO, Calvin McDonald, would step down at the end of January, and that the company is seeking a successor. Mr. McDonald, who had led the retailer since 2018, had struggled to reassure investors amid a slowdown in its U.S. business. The company’s stock jumped 10 per cent after the announcement.
In his press release, Mr. Wilson said the directors he has put forward will help the company redefine its creative vision, attract the best employees and maximize shareholder return.
These directors are Marc Maurer, the former co-CEO of On Holding AG, a Swiss athletic shoe and sportswear company known for challenging established brands such as Nike and Adidas; Laura Gentile, formerly chief marketing officer for American cable sports network ESPN; and Eric Hirshberg, former president and CEO of American video game publishing company Activision.
Mr. Wilson said he intended to file official proxy materials with the U.S. Securities and Exchange Commission, which would allow shareholders to vote with him by supporting his proposed directors, as opposed to the company’s nominees.
Chip Wilson, founder of Lululemon, at his office in Vancouver in December, 2018. Mr. Wilson believes the directors he has put forward will help the company redefine its creative vision.DARRYL DYCK/Globe and Mail
The directors will be up for nomination during the company’s next annual general meeting. Last year’s AGM took place in June.
In a press release issued Monday afternoon, Lululemon said its board members would evaluate Mr. Wilson’s director nominees in due course, in accordance with the company’s governance process, and present a formal recommendation in the company’s proxy statement.
“Mr. Wilson has not been involved with the company for a decade, and since his departure, lululemon has continued to adapt to the marketplace and lead the industry, building one of the most compelling growth stories in retail,” the company said in the release.
Mr. Wilson, who founded Lululemon in 1998, has not been a member of the board since 2015, but he remains a major shareholder. In recent months he has publicly slammed the company for its “loss of cool,” criticizing the board for complacency and what he has characterized as a focus on financial success over design innovation.
Lululemon is also contending with pressure from an activist shareholder with its own succession ideas.
One of the world’s largest activist funds, Elliott Investment Management, has built a more than US$1-billion stake in Lululemon, and is pushing to be part of the conversation about the CEO selection.
Elliott is working with Jane Nielsen, a former chief operating officer and chief financial officer at Ralph Lauren, as a possible candidate to replace Mr. McDonald.
As an early mover in the upscale athleisure market, Lululemon popularized yoga leggings and made athletic wear fashionable outside the gym. But in recent years, the company has faced pressure from new brands such as Alo Yoga and Vuori, which have stayed on top of trends.