Target’s CEO has become the first boss of a major corporation to lose his job over a breach of customer data, showing how responsibility for computer security now reaches right to the top.
Gregg Steinhafel, who also was president and chairman, stepped down nearly five months after Target disclosed a huge pre-Christmas breach in which hackers stole millions of customers’ credit- and debit-card records. The theft badly damaged the store chain’s reputation and profits.
Steinhafel, a 35-year veteran of the company and chief executive since 2008, also resigned from the board of directors, Target announced Monday.
“He was the public face of the breach. The company struggled to recover from it,” said Cynthia Larose, chairwoman of the privacy and security practice at the law firm Mintz Levin. “It’s a new era for boards to take a proactive role in understanding what the risks are.”
The departure of Steinhafel, 59, suggests the company wants a clean slate as it wrestles with the fallout. But the resignation leaves a leadership hole at a time when the 1,800-store chain is facing many other challenges.
The company, known for its trendy but affordable housewares and fashions, is struggling to maintain its cachet while competing with Wal-Mart and Amazon.com. Target also is grappling with a disappointing expansion into Canada, its first foray outside the U.S.
Experts say the breach, which highlighted the flaws in Target’s security system, seemed to be the final straw.
Chief Financial Officer John Mulligan was named interim president and CEO.