CH Robinson Chief Executive Bob Biesterfeld resigned Saturday and the company’s Chief Executive Scott Anderson is now interim CEO.
A filing with the Securities and Exchange Commission on Tuesday specifically noted that Biesterfeld’s departure is viewed as an “involuntary resignation by the company without cause.”
The Eden Prairie-based company offered no reason for the abrupt transition with its public announcement Tuesday morning. The logistics and freight giant has hired Russell Reynolds, a leading national recruitment firm, to find a permanent replacement.
Stephens Inc. analyst Jack Atkins said pressure on the company’s top executive had been mounting for some time.
“We believe this transition has evolved over the past few months,” Atkins wrote in a note to investors on Tuesday.
With Anderson’s appointment as interim CEO, Jodee Kozlak was appointed independent chairman of the board. Anderson thanked Biesterfeld for his “significant contributions” over his three years as CEO.
The company’s fall was bumpy as supply chain disruption from the pandemic transitioned to a new normal. CH Robinson announced in November that it would lay off 650 employees, or 3.6% of its workforce, after third-quarter results slumped.
Biesterfeld said in July the company will see lower demand as rising inflation rates change consumer habits. A slowdown in retail and housing markets, he said, would weigh on demand in the second half of the year.
“It has been a privilege to lead CH Robinson and this exceptional team,” Biesterfeld said in a press release. “I am proud of everything we have achieved together and it has been my pleasure to work with so many talented team members across the company during my tenure as CEO. I am confident that CH Robinson’s industry-leading people and culture will continue to exist, ensuring the company is well-positioned for the future.”
One of Biesterfeld’s big initiatives as CEO was to double the pace of its technology investments to expand its advantages over other third-party logistics companies. In 2019, he announced that CH Robinson would invest $1 billion in technology over the next five years.
But the company recently came under pressure from an activist investor. Ancora Group won two seats on CH Robinson’s board in February and later signed a standstill agreement.
Atkins said the disappointing third-quarter results reported in November “and a very challenging earnings backdrop for the company” likely contributed to the CEO’s decision.
Anderson was appointed to CH Robinson’s board of directors in January 2012 and has served as chairman since 2020. From 2010 to 2017 he was Chief Executive of Patterson Cos.
“I am honored to assume the role of interim CEO and am committed to ensuring this is a seamless transition for everyone involved at CH Robinson,” Anderson said in the press release. “Now is the right time for CH Robinson to accelerate our strategic initiatives, and the Board is focused on finding a successor CEO who can capitalize on the opportunities available to Robinson. I look forward to working closely with our talented people to continue enhancing our customer and carrier experience and scaling our digital operations to drive sustainable growth.”
According to Tuesday’s SEC filing, interim CEO Anderson will not be a candidate for the permanent position.
A new CEO at CH Robinson faces increased competition in the logistics space. While Robinson is the largest outside logistics company, the industry is fragmented with many small competitors and a growing number of tech-enabled startups.
Morningstar analyst Matthew Young estimates that CH Robinson accounts for 17% of the truck brokerage industry in the U.S. thanks to the large network of trucking and trucking companies it works with, but notes that competition is increasing. “We anticipate that as the industry consolidates, competition will begin to become better organized,” Young wrote in a research note.
Given the near-term and long-term challenges CH Robinson faces, Atkins is hesitant about CH Robinson’s immediate prospects. “We believe the issues here are bigger than one person and will take time to fix,” Atkins wrote.
“Also, the CEO change could raise cultural issues as we believe Mr. Biesterfeld was highly regarded internally,” he added.