Target's CEO Steinhafel resigns, Mulligan tapped as interim

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In a high-level shakeup, Target on Monday announced that Chairman, President and CEO Gregg Steinhafel is stepping down, effective immediately.

The Minneapolis-based retailer said Chief Financial Officer John Mulligan has been appointed interim president and CEO. Roxanne S. Austin, a member of Target’s board, has been named as interim nonexecutive chair of the board. Both will serve in those roles until permanent replacements are named.

Steinhafel, 59, has led the nation’s third-largest retailer since 2008. He also resigned from Target's board of directors.

The exit of Steinhafel, a 35-year veteran of the company, comes in the wake of the massive data breach in December, one in a series of big challenges he has faced in the last six years. The security problem five months ago hurt the retailer's reputation among customers and has curbed business, the Associated Press notes.

Hearings in Congress focused on Target's handling of the breach.

Here's a link to the company's official statement, which despite Target's struggles, has kind words for Steinhafel.

The statement reads, in part, "The board is deeply grateful to Gregg for his significant contributions and outstanding service...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."

The statement also notes Steinhafel's leadership in "...navigating the financial recession, reacting to challenges with Target’s expansion into Canada, and successfully defending the company through a high-profile proxy battle."

The Star Tribune reports that Steinhafel started as a merchandise trainee in 1979 and progressed through management positions before being named president of Target in 1999.He was named CEO in May 2008 and chairman in February 2009. Steinhafel’s total compensation for 2012 was $23.47 million, the Star Tribune reported.

An internal Target e-mail sent to team members and obtained by BringMeTheNews details the management transition like this: "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 lead a comprehensive CEO search. The search is underway and a board briefing is expected at our next meeting on May 14."

In his role CFO, Mulligan was Target's point person in Congressional hearings; he testified before the U.S. Senate Committee on the company's response to the data breach. Mulligan's profile on Target's website notes that he joined Target in 1996 as a financial analyst, and has since held key leadership positions in Finance, Target.com and Human Resources. His corporate bio says that he graduated from the University of Wisconsin in 1988, and in 1996 he earned a masters of business administration degree from the University of Minnesota.

Target stock was down in early trading Monday. That's likely partly due to the fact that it could take some time to name a permanent replacement CEO, the site 24/7 Wall Street notes.

Target's stock is down about 2.5 perent from December 18, 2013, the day the breach was made public, Forbes notes. But the chain's stock is up about 18.7 percent since Steinhafel became CEO.

Last week, Target named Bob DeRodes, who has 40 years of experience in information technology, as its new chief information officer. Target said it is continuing its search for a chief information security officer and a chief compliance officer.

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