Indigo sees nearly half its board exit; founder Heather Reisman to retire this summer

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Indigo Books & Music Inc. IDG-T has seen an exodus of nearly half of its board of directors – with one departing member saying she has lost confidence in the board’s leadership – and has announced that company founder Heather Reisman will retire later this summer.

The Toronto-based retailer on Wednesday announced that four of its 10 directors have stepped down: Frank Clegg, Howard Grosfield, Anne Marie O’Donovan and Dr. Chika Stacy Oriuwa. The company also wrote in a release that Dr. Oriuwa resigned “because of her loss of confidence in board leadership and because of mistreatment.” Before her resignation, she had served on the company’s human resources, compensation and governance committee.

Indigo founder Heather Reisman has served as executive chair of the board since last September, when she stepped back as chief executive officer, promoting Peter Ruis to the top job. On Wednesday, Indigo announced Ms. Reisman plans to retire from the board on Aug. 22.

Indigo spokesperson Melissa Perri declined to answer questions about the reason for the directors’ departures.

When contacted by e-mail, Dr. Oriuwa declined to provide further information on the nature of the mistreatment or the loss in confidence in the board’s leadership. “I have full confidence and respect for Peter Ruis, CEO of Indigo, faith in his management team and executive strategy,” she wrote.

Ms. Reisman did not respond to requests for comment on the matter.

All four of those who have departed were independent directors, leaving the Indigo board with three independent and three non-independent directors – the latter including Mr. Ruis; Ms. Reisman’s daughter, Andrea Johnson; and Ms. Reisman’s husband, Onex Corp. ONEX-T chairman Gerald Schwartz, who is also Indigo’s controlling shareholder.

Ms. Reisman and Mr. Schwartz, through various companies, own 16,737,265 Indigo shares, or 61.2 per cent of the company, according to a disclosure filed in November, 2022.

The changes also mean that Indigo’s board has lost two out of three members of its audit committee, including Ms. O’Donovan, who served as the committee’s chair, as well as two out of three members of its human resources, compensation and governance committee.

Indigo did not announce who will serve as the new executive chair. Robert Haft is currently the board’s lead director, and chair of the latter committee.

“Work is being done during this period of Board transition to ensure a strong team of Directors in place. We will have more to share as we move forward,” Ms. Perri wrote in an e-mailed statement.

Just nine months ago, Ms. Reisman had planned to remain very involved in the business, driving its overall strategy and vision, Mr. Ruis said in an interview with The Globe and Mail at the time. On Wednesday, Ms. Reisman wrote in the release that it was time to retire from an active role with Indigo.

“Deciding when it is time to move on is one of the toughest decisions a founder must make, but I know this is the right moment for me,” Ms. Reisman wrote in a statement.

Indigo appointed Dr. Oriuwa, a psychiatry resident at the University of Toronto, to its board in November, 2020. In a statement at the time, Ms. Reisman noted that Dr. Oriuwa would influence the company’s efforts to expand its assortment of wellness-related products, and that she would be “an additional and knowledgeable voice to inform our diversity and inclusion efforts.”

Her bio on Indigo’s investor relations site notes that she was valedictorian of her graduating class at the University of Toronto’s faculty of medicine, and was the first Black woman to be named sole valedictorian.

The board departures occur amid a challenging period for Indigo. In February, a cyberattack took down the retailer’s e-commerce operations and leaked sensitive information about current and former employees.

Indigo is also operating in a difficult environment, as shoppers are cutting back on the type of non-essential purchases – such as housewares, toys and tech gadgets – that make up a sizable portion of Indigo’s product assortment. The company is scheduled to report its fourth-quarter financial results later this month.

“I firmly believe the Indigo family, spanning from coast to coast, is the best in the business, and the company has a bright future,” Ms. Reisman wrote in her statement. “Building Indigo over the past 25 years has been the adventure of a lifetime. As I embark on this new chapter, I will be rooting for the company every step of the way.”