Everyone has been told at least once in their lives that to reach the top one must start at the bottom and work their way up slowly.
Many CEOs begin their careers this way, working in stores or banks for minimum wage. Some eventually climb the corporate ladder until they reach one of the highest positions one can hold at a company.
For Kroger CEO Rodney McMullen, this is exactly the path his career took.
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McMullen began working at Kroger in 1978 as a grocery store clerk, working to pay his way through college. After graduating with a Master’s in Accounting, Kroger offered him a job as an Accounting Supervisor. Throughout the years, he received continuous promotions and became a key asset to the company.
In 2014, McMullen was named CEO of Kroger. However, after nearly 47 years since first joining the company, his history with Kroger would come to an end, and the reason for this abrupt conclusion has nothing to do with retirement but instead for running afoul of Kroger’s business ethics.
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On Feb. 21, Kroger’s Board of Directors was notified of certain personal conduct by McMullen, which prompted the company to take immediate action by opening an investigation conducted through outside independent counsel, which a special Board committee will oversee.
Kroger is one of the largest grocery retailers in the U.S.; the company’s CEO just resigned.
Kroger CEO Rodney McMullen resigns from his position amid investigation
On Monday, Kroger (KR) announced the resignation of its long-time CEO, Rodney McMullen, following an investigation by the Board over conduct which doesn’t align with Kroger’s policy on business ethics.
Although Kroger didn’t provide further details regarding the matter, the investigation is unrelated to the company’s financial performance, operations, or reporting, and did not involve any Kroger associates.
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According to The Kroger Co. Policy on Business Ethics, the requirements of ethical behavior transcend the particulars of a policy or law, and the best way to instill it throughout the company is for each member to set a good example through their own behavior.
“Kroger’s integrity is our most important asset. Each of us bears a responsibility for protecting Kroger’s good name. By adhering to the spirit, principles, and practices outlined in this document, each of you will help safeguard our reputation,” the Policy states, which McMullen signs as well.
Although most of the policy refers to business practices, a section about General Integrity states that to maintain and enhance Kroger’s reputation, all must adhere to the highest moral, ethical, and legal standards, which also apply outside of the work environment.
Kroger appoints an interim CEO after McMullen’s resignation
Kroger’s Board has appointed Kroger Lead Director Ronald “Ron” Sargent to serve as Chairman of the Board of Directors and interim CEO while the company searches for the right candidate to fulfill this position. Sargent’s temporary assignment is to take effect immediately.
“As interim CEO, I am committed to working alongside our proven and experienced management team and dedicated associates to ensure Kroger continues providing exceptional value for our customers,” said Sargent.
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Sargent has a background similar to McMullen as they have both been with the company for decades and began their Kroger careers by working as grocery store clerks while in college.
“Kroger has been a special place throughout my retail career after spending summers in college working in stores, as well as my first ten years after business school at corporate headquarters, before more recently serving as lead independent director,” said Sargent.
“My decades here have given me a full appreciation of what makes Kroger unique, and I am excited to work even more closely with this talented team. I plan to be a steady, but active hand in the execution of our strategy,” he added.
Although Kroger may be keeping the reason behind the investigation against the former CEO private, more details will emerge as it unravels over the next few weeks.
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