The Co-operative Group has announced that chief financial officer Richard Pennycook will take over as interim chief executive following the resignation of Euan Sutherland.
Mr Sutherland announced yesterday (March 11th) that he was stepping down from the role because he does not agree with the way the company is being governed.
The Co-Operative Group, unlike most organisations, is run for the benefit of its members, rather than its shareholders. But Mr Sutherland argued that decisions are being made that instead considered the impact on elected officials.
In a statement, he stated that he resigned with "great sadness" and revealed that he will "not accept" the retention and bonus payments that had previously been agreed with his employers.
Co-op chairwoman Ursula Lidbetter added she accepted the resignation of Mr Sutherland with "deep regret" as she confirmed Mr Pennycook will temporarily step up to the chief executive role.
She said: "Euan's resignation must now act as a catalyst for the real and necessary change which the group must go through."
Mr Sutherland was in his position for less than a year but stated he was not able to push through the reforms he wanted to implement at the top of the organisation.
He said: "We appear to have disaffected people who are determined to make life difficult and embarrassing for the Co-operative at a time when what we need most are professionalism and loyalty to the business."
Lord Levene, who led a rival bid for Lloyds TSB branches in competition with the Co-op Bank, told the BBC that this resignation is the latest stage in a "never ending" series of issues for the firm. "They got in a good professional to run the place, and it seems he looked, and decided it wasn't for him," he said.
Mr Pennycook, who takes over from Mr Sutherland as chief executive with immediate effect, added that businesses will "continue to perform in line with the clear commercial plans put in place under Euan's leadership". He added: "I and the team will plot a steady course in the coming months."
Co-op Group operates 4,500 retail outlets and employs almost 90,000 people.
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