The fall of 2010 was a challenging, even painful, time as our still-new CEO Chuck Maniscalco announced his resignation and the Board of Directors made the difficult decision to end the company’s relationship with our co-founder, long-time CEO, and Executive Chairman Jeffrey Hollender. The brand has evolved to embody Jeffrey’s original values and his legacy lives on in the work that we do and the mission that drives our company. Our new CEO John Replogle is energizing Seventh Generation, recommitting all of us and our company to a core set of values based upon the vision Jeffrey embraced 23 years ago.
Seventh Generation has always believed in the importance of radical transparency and corporate responsibility and has a long tradition of sharing our successes and challenges as a values-driven company. The Board’s fall 2010 announcement of Jeffrey’s departure was met with shock, cynicism, sympathy, outrage and every emotion in between. For many, our explanation fell short of the level of transparency expected of us. Despite legal constraints on what we can disclose, we would like to provide some perspective here.
Looking back to 2008, Seventh Generation was receiving deserved acclaim for our product innovations, sustainability strategy and social mission. With our co-founder Jeffrey Hollender at the helm, we enjoyed greater than 50% sales growth that year. With the company poised to grow much bigger and more complex, Jeffrey decided to step down as CEO. He explained that, “While I knew I still had many meaningful contributions to make to Seventh Generation, it became clear to me that what I could not do was supply the managerial wisdom and experience needed to steer the company on the next stage of its voyage.” Jeffrey resigned in 2009 while retaining roles as Chief Inspired Protagonist and Executive Chairperson.
Attracted by our company’s philosophy, Chuck Maniscalco joined us as CEO in June 2009, bringing the solid brand growth experience we needed. Chuck built the infrastructure necessary to support our future growth, introduced systems that provide deeper and more insightful monitoring and analysis of the state of our business, and improved our overall business practices. He announced his intention to pursue other interests in mid-2010 but stayed on until a new CEO was hired.
With the company needing "unambiguous leadership at the top" and the Board and Jeffrey unable to bridge their philosophical differences concerning management of the company, the Board reluctantly voted in October 2010 to remove Jeffrey from the Board and end his employment relationship with the company. Jeffrey vigorously opposed this decision and it continues to be an open wound in the company’s relationship with its founder. More recently, Jeffrey reflected on the reasons for his departure at the 2011 Sustainable Brands conference. Without endorsing his depiction of events, we provide a link to this summary of his talk to enable our stakeholders to understand his perspective.
The Board and Jeffrey penned a legal agreement that limits the public airing of this process and its rationale to protect both parties. This limits our ability to discuss this as openly as we might like in this report, but the issues involving a transition from entrepreneurial founder to professional management in growing businesses are not new. Many companies have stumbled at this point and while it was a difficult process for Seventh Generation, the company has weathered the transition strongly committed to its long-standing vision.
In explaining the Board’s decision to Seventh Generation’s shareholders, Chairman of the Board, Peter Graham, shared these words:
“As the leader of the company since its very earliest days and its philosophical light for over two decades, Jeffrey has been an integral part of our brand and an obvious lynch pin of our success, our unique corporate spirit, and our much acclaimed emphasis on equity and justice in the way we conduct our business. It is no overstatement to say that without his unwavering dedication to our cause and his tireless efforts on our company’s behalf, we would not be the company we are today, and indeed might not be here at all. His is a legacy worthy of the highest respect and admiration, and nothing in our recent decision should dim that in any way…Though our leadership has changed, our aspirations have not.”
Mindful of the journey still ahead of us, in the spring of 2011, we are enthusiastically moving forward with our new CEO, John Replogle, formerly CEO of Burt’s Bees. He brings a sense of excitement and optimism to our organization and a pledge to continue to fulfill our company mission. Corporate growth is not always easy or smooth, but we hope that we have emerged stronger and with a recommitted sense of purpose.