Dive Brief:
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REI expressed disappointment Thursday after its membership failed to elect three board members — including two incumbents — it had nominated ahead of its annual meeting.
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But the REI Union called it a win for its “Vote No” campaign, saying in a statement that “REI members and REI workers stood together to send a resounding message that it is time for the co-op to return to its core values.” Since 2022, eleven REI stores have voted to unionize.
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The outdoor retailer also released financial results for 2024, reporting that net sales fell more than 6% year over year to $3.5 billion. Net loss narrowed, though, shrinking nearly 50% to $156.4 million, and the co-op closed out the year in a cash-flow neutral position.
Dive Insight:
As a pandemic-era boom has fizzled for the outdoor category, several retailers including REI have scrambled to adjust. In addition to corporate layoffs last year, the retailer downsized then eliminated its experiences business, tightened up its return policy and hired a new CEO.
Its failure to get its preferred nominees onto its board overshadowed other announcements from the company, including that last year it “became the first major U.S. retailer to achieve the industry definition of zero waste, diverting 90% of waste from landfills across its operations.”
REI Board Chair Chris Carr said the retailer is “losing two incumbent directors who have been valuable contributors to the co-op for a number of years and one promising new director. Therefore, on behalf of the board, I would like to extend my gratitude and appreciation to them.”
But in its statement, the union expressed optimism that newly arrived CEO Mary Beth Laughton would take it as an “opportunity to listen to everyone who voted for workers and members to have a voice in the company’s future.”
“Moving forward, REI should stop union busting, negotiate a fair contract with organized workers, and fill the vacancies on the board with the candidates that members backed initially,” the union said.
The union had put forward two environmental leaders —Tefere Gebre, of the AFL-CIO and Greenpeace, and Shemona Moreno of 350.org — and REI members sent in more than 10,000 co-nominations for them. REI did not put either on the ballot.
The labor group is calling on REI to fill two of the three now-empty board seats with those candidates. Gebre said Thursday he’d “still be happy to serve and work toward making sure workers and members are represented fairly.” Carr said that, per REI’s bylaws, the three seats will remain vacant until the board fills them.
REI’s progressive image has tarnished as it continues to fight unionizing at its stores, often in a manner resembling Amazon’s. The retailer in 2023 hired law firm Morgan Lewis, known for its work against union efforts on behalf of Amazon and other employers, when union organizers accused it of unfair labor practices. There are still 35 charges documenting 175 violations of labor law pending with the National Labor Relations Board, the union said Thursday.