REI CEO Stritzke Resigns Over Undisclosed Personal Relationship
Outdoor retailer Recreational Equipment, Inc., or REI, says its president and CEO Jerry Stritzke has resigned for failing to disclose a personal relationship with the head of another organization in the outdoor industry, according to a company statement. REI's board accepted Stritzke’s resignation “following an investigation into the facts and circumstances surrounding a personal and consensual relationship between the REI CEO and the leader of another organization in the outdoor industry.” Stritzke, who joined REI in 2013, will leave the co-op on March 15, and current COO Eric Artz will take on the role of interim CEO. The investigation, which found no evidence of financial misconduct, was conducted by an external law firm and overseen by REI’s board of directors. The board thanked Stritzke in an open letter to employees for his drive, creativity and many innovative contributions to the co-op, highlighting that he has recruited great talent and made a great number of successes possible.
Total Retail's Take: While this news can't be good for REI, the way it was handled could be considered a master class in human resources management. The company was transparent and forthright in telling its employees — and the public — the news as soon as possible, and it was done in a positive and nurturing way. In the letter to employees, REI Board Chair Steve Hooper praised Stritzke for the work he did, as opposed to keeping silent or burying the news.
"Jerry has been an excellent CEO for REI, and together all of you have delivered outstanding results for the co-op during remarkably challenging times in retail," wrote Hooper. "The co-op is stronger today than when Jerry joined. We're confident that you have the right strategy, great talent and a very strong leadership team" Hooper was also forgiving: "Errors of judgment were made, and Jerry and the board agree that it's time for a new leader to take the co-op forward." Likewise, in an open letter to employees, Stritzke, who spent the past five years helping build REI’s brand as one of the most ethical players in the outdoor retail business, offered a forthright apology. “I regret few things in life, but I am sorry that I did not disclose the relationship, and it’s time for the co-op to have a new leader."
What the resignation of Stritzke means for the health of REI is another story. It comes at a challenging moment for REI, as the outdoor retail industry faces strong competition from online retailers, as well as the growing popularity of rental and secondhand products marketed to a younger, more cost-conscious consumer.