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Lululemon Athletica is in the midst of a leadership shake-up as founder Chip Wilson launches a proxy fight to revamp the company's board amid falling sales and stiff competition.

The yoga apparel retailer has been searching for a new CEO following Calvin McDonald's announcement that he will step down in January.

Wilson, Lululemon's second-largest shareholder with a 9% stake, has been a vocal critic of the board, calling it "complacent" in the face of declining North American sales, NY Post reported.

On Monday, he nominated three new directors—former On Running co-CEO Marc Maurer, ex-ESPN chief marketing officer Laura Gentile, and former Activision CEO Eric Hirshberg—to strengthen the board's product expertise and guide the CEO search.

"The recent CEO change announcement was the third total failure of board oversight with no clear succession plan in place," Wilson said in a statement.

"Shareholders have no faith that this board can select and support the next CEO without input from a board with stronger product experience."

A spokesperson for Lululemon confirmed the company will evaluate Wilson's nominees "in due course in accordance with the Board's governance process."

Previously, Wilson declined to provide nominee names when asked by Lululemon to avoid a "costly and distracting proxy fight."

Activist investor Elliott Investment Management is also pressing for change, holding a $1 billion stake in the Vancouver-based company. Elliott has proposed former Ralph Lauren executive Jane Nielsen for the CEO role.

A source familiar with Wilson's thinking said he is not coordinating with Elliott but acknowledged that their campaigns do not interfere with each other.

Lululemon Founder Launches Proxy Fight

Lululemon has struggled this year with fashion missteps and increased competition from brands such as Alo Yoga and Vuori.

The company discounted more merchandise than ever in its 27-year history, including bright-colored leggings that landed on clearance racks, according to analysts.

According to CNBC, shares have shed nearly half their value in 2025, though they rose about 1% on Monday after news of Wilson's proxy fight.

Wilson emphasized that his campaign is not about himself but about restoring "genuine creative leadership" to the company. He did not seek a seat on the board, saying the focus should be on strengthening the brand.

This is not Wilson's first push for board changes. After founding Lululemon in 1998, he left daily operations in 2012 and stepped down as chairman in 2013 following a recall of see-through yoga pants.

He resigned from the board in 2015 after disagreements over strategy but later sold part of his stake to Advent International while securing additional board positions.