Business

Target CEO Exits Amid Security Breach Fallout

The resignation of CEO Gregg Steinhafel is the latest shake-up for Target after last year's data breach. Some speculate

Target CEO Exits Amid Security Breach Fallout
Target
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‚ÄčTarget is undergoing a swift executive shake-up following its widespread data breach last year. The retailer has announced Gregg Steinhafel will step down as CEO.

"A massive data breach at Target now costing the CEO of that company his job." (Via Fox News)

"CEO and Chairman Gregg Steinhafel, who's been with Target since 1987, is now stepping down. It is effective immediately." (Via Bloomberg

" ... stepping down after that massive data breach. The timing of the announcement is leaving some scratching their heads." (Via CNBC)

Many in the media are speculating Steinhafel's exit is a direct fallout from Target's security crisis, which reportedly cost the company $61 million to correct.

A letter written by the company's board refers to the former CEO's handling of the breach but doesn't give a firm reason for Steinhafel's departure.

"[Steinhafel] held himself personally accountable and pledged that Target would emerge a better company. We are grateful to him for his tireless leadership and will always ‚Ä®consider him a member of the Target family." 

But after reading the board's statement, CNN's Poppy Harlow believes there are some things the company left unsaid.

"So what's interesting in this release that just came out is that the company is not saying this is tied to the breach. … However, this was a massive data breach, hurt them from a PR standpoint, it affected how many people have come into their stores. It cost them millions of dollars, and it hurt their earnings."

So, in other words, it's anyone's guess why Steinhafel quickly resigned in a seemingly overnight decision. He has been with Target for 35 years and will now serve as an adviser during the transition.

In his place, Chief Financial Officer John Mulligan will serve as interim CEO, and board member Roxanne Austin will take over his duties as a nonexecutive chair of the board.

The breach in December of last year compromised the personal information of up to 110 million customers. Besides spending millions to fix the problem, Target's fourth quarter earnings fell and the Minnesota retailer's credit ratings took a hit.

Target has not said who is under consideration to take the reins as CEO next.