Gildan Activewear Publishes Investor Presentation for 2024 Annual Meeting - Seite 2

Glenn Chamandy is no longer the CEO that Gildan needs and there was a clear case for change in 2023 after he irreparably broke the trust of Gildan’s Board.

• It became apparent to the Board as early as in 2021 that it was time to prepare for a Gildan without Mr. Chamandy. The Board discussed succession planning with Mr. Chamandy for many years. Mr. Chamandy himself agreed that change was needed when he told the Board in 2021 that he would retire in 3-5 years. Despite this, Mr. Chamandy sabotaged the process when it came time to execute on the succession plan.
• The case for change in 2023 was clear:
  • Mr. Chamandy was gradually more disengaged in Gildan’s business, averaging only 4 days in the office per month in the six months prior to his termination and sending out no more than a handful of work-related emails each day.
  • Mr. Chamandy was distracted by outside personal pursuits including the development a luxury golf resort in Barbados.
  • Mr. Chamandy never visited Gildan’s newest manufacturing plant in Bangladesh, a major investment for the company.
  • Mr. Chamandy held few senior management meetings.
  • Mr. Chamandy failed to govern himself in accordance with acceptable standards of behavior for a chief executive, such as recording a private and confidential phone call with former Chair Donald Berg, without Mr. Berg’s knowledge.
  • Instead of putting forward a compelling strategy, Mr. Chamandy attempted to entrench himself by giving the Board an ultimatum: approve a high-risk multi-billion-dollar acquisition strategy predicated on guaranteeing his role as CEO for several more years to oversee its integration, or he would leave the Company immediately and sell his shares.
  • Gildan’s business was losing momentum, growth was stalled, and share price performance had been stagnating for the past ~10 years.
• While the Board was focused on an orderly transition, Mr. Chamandy’s sabotage of an agreed succession plan and his insistence of a risky and dilutive multi-billion-dollar acquisitions strategy left the Board with no choice but to terminate him.
• As he left, he also violated company polices related to the safeguarding of corporate information by wiping data from his Gildan communication devices.

• Vince Tyra is exactly the right CEO to scale Gildan in an increasingly complex and fiercely competitive global environment.
  • The Board undertook a robust and structured CEO succession planning process and at the conclusion of this process selected Vince Tyra as CEO.
  • Few people have had the opportunity to demonstrate their leadership skills across such an impressive range of industries and managerial challenges as Vince Tyra. The throughline of Vince’s career is using his financial acumen, sound management and ability to build teams and motivate people around a shared strategy and vision to improve the companies and organizations he has led.
    • Houchens Industries: As Senior Vice-President of Corporate Strategy and M&A, Vince led the strategic growth of this $4 billion revenue employee-owned holding company through investments in sectors including consumer products and retail.
    • University of Louisville: In perhaps the most challenging turnaround of his career, Vince fixed the scandal-plagued Athletics Program at the NCAA powerhouse. Under his leadership, Vince established a new culture of excellence and compliance while rebuilding the sports program.
    • Southfield Capital: As an Operating Partner and Investment Committee Member at Southfield, Vince helped achieve industry leading returns by positively impacting many portfolio companies in various leadership positions. At Southfield, Vince’s portfolio produced strong returns, with an internal rate of return of 27% and a multiple of invested capital of 3.2x.
    • Broder Bros.: As CEO of Broder, Vince spearheaded a successful series of acquisitions, including Alpha Shirts – later named Alphabroder, tripling EBITDA – the basis for value creation at private equity firms. Under Vince’s leadership, Broder successfully executed Bain Capital’s levered roll-up strategy and transformed itself into the market leader.
    • Fruit of the Loom: Vince joined Fruit of the Loom from 1997 to 2000 where the board of directors promoted him to President during a tumultuous time where he developed and implemented a successful restructuring plan ahead of its eventual sale to Berkshire Hathaway.
    • In addition, Vince invested in and grew his own activewear business early in his career, while utilizing Gildan as a key supplier.
    • Vince has served on the board of directors at 10 companies and stepped in as interim CEO at three companies.
  • Vince hit the ground running in his role as President & CEO of Gildan and has prioritized consistent engagement with the various stakeholders of Gildan, including:
    • Visiting 18 offices and manufacturing sites to get immersed in Gildan’s processes and cultures,
    • Attending various trade shows to reinforce his presence and reconnect with customers,
    • Holding town halls and interacting with approximately 94% of Gildan’s global leadership base as well as over 2,000 employees to create a two-way dialogue,
    • Kicking off dialogue with major partners to better understand challenges and opportunities, and
    • Putting forward an enhanced GSG strategy that reflects the input of shareholders and leverages Gildan’s manufacturing strength by growing its commercial capability.
  • After Mr. Chamandy’s termination, the Board retained renowned independent corporate governance expert, Dr. Richard Leblanc to evaluate Gildan’s CEO succession planning process. His report concluded that the Board took a series of “reasonable steps” that would be expected of a Canadian public company board. Among his key findings, Leblanc stated: “Based on my review, it is my opinion that the Board acted in a manner consistent with prevailing standards of corporate governance for CEO succession planning, and the duties and obligations owed by directors to Gildan, during the time from May 2021 to the letter of termination of the former CEO, dated December 10, 2023.”