NEW YORK (AP) — Ethan Allen Interiors Inc., the Danbury, Connecticut‑based home‑furnishings retailer, said Monday it has engaged a nationally recognized executive‑search firm to begin a comprehensive hunt for a new chief executive officer. The board has set a firm deadline to announce the next CEO no later than June 30, 2027, the date Kathwari’s current employment contract expires.
Transition plan for Farooq Kathwari
Farooq Kathwari, who has led the company as president since 1985 and as chairman and CEO since 1988, will step down from day‑to‑day management when his contract ends. He will remain a non‑executive member of the board until the company’s 2027 annual shareholder meeting, providing continuity while the new leader is identified.
Board’s commitment to a smooth succession
The board emphasized that the search will consider both internal candidates familiar with Ethan Allen’s culture and external leaders who can bring fresh perspective. By naming a deadline, the board aims to give shareholders confidence that the transition will be orderly and that the company’s strategic initiatives will stay on track.
Investor criticism and calls for change
Doug Bergeron, an investor who owns more than a 5% stake in Ethan Allen, publicly expressed disappointment with the board’s handling of the succession process. In a statement released on Sept. 10, Bergeron said the company “has all the ingredients needed to compete and win in the home furnishings industry,” but it “lacked leadership capable of putting its considerable assets to work.” He added that the board’s composition, which he described as “loyalists to Farooq,” was “utterly unqualified to select the next CEO.”
Bergeron also noted that he had previously nominated an alternate slate of six board members for the upcoming shareholders’ meeting, signaling his desire for a more activist board that would accelerate leadership change.
Company response to criticism
Ethan Allen’s spokesperson responded that the board’s primary responsibility is to act in the best interests of shareholders and that the search process is being conducted with the utmost diligence. The company highlighted recent financial performance, noting stable revenue growth and a strong balance sheet, which they say positions Ethan Allen well for future expansion.
What this means for the furniture market
The CEO transition comes at a time when the home‑furnishings sector is navigating shifting consumer preferences, supply‑chain challenges, and heightened competition from both traditional retailers and online‑only players. Analysts note that a new chief executive could bring strategic initiatives such as expanding e‑commerce capabilities, modernizing product lines, and exploring new distribution channels.
Stakeholders will be watching the upcoming shareholder meeting, typically held in November, for any further developments on board composition and the timeline for the CEO appointment. The outcome could influence investor confidence and set the tone for Ethan Allen’s growth strategy over the next several years.
Looking ahead
With the deadline set for mid‑2027, the board has ample time to vet candidates and ensure a seamless handover. The company’s commitment to transparency and its engagement of a reputable search firm suggest a methodical approach aimed at preserving the brand’s legacy while positioning it for future success.
Original reporting: Alexandria, VA News – WTOP News — read the source article.
