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News March 18, 2025

Former Board Members Sue Gildan in Continued Fallout From Proxy Fight

Past Gildan board chair Donald Berg and nine other previous directors assert that the publicly traded Counselor Top 40 supplier owes them a combined $25.6 million.

By  Christopher Ruvo

Key Takeaways

• See You In Court: Ten former Gildan (asi/56842) board members are suing the Counselor Top 40 supplier, saying they are owed $25.6 million in deferred compensation.

• Proxy Fight Continues: The suit represents continued fallout from a six-month-long corporate battle that followed the Dec. 2023 ousting of now-reinstated CEO Glenn Chamandy. Gildan has reportedly spent $82 million on the proxy fight.

• Financial Snapshot: Despite sales and stock price increases, Gildan's net income dropped 25% in 2024.

The fallout from Counselor Top 40 supplier Gildan’s (asi/56842) epic proxy fight has yet to subside.

On March 7, 10 former members of the publicly traded company’s board of directors sued Gildan in Quebec Superior Court, alleging the Montreal-headquartered firm owes them a combined $25.6 million.

The suit asserts that Gildan has not cashed out deferred compensation the past directors are owed due to “the investigation of certain questions surrounding the board of directors and the decisions it made during the course of the CEO succession.”

Former board chair Donald Berg’s claim is the largest at $5.7 million. Berg, who served on the Gildan board for nearly 10 years, is a former corporate leader who spent about 25 years with Brown-Forman Corp., a major player in the wine and spirits business. The smallest claim is from past Gildan board member Sharon Driscoll, a former RB Global Inc. chief financial officer who served on Gildan’s board for about six months.

Geneviève Gosselin, Gildan’s director of global marketing and corporate communications, told ASI Media that the company will not be commenting on the legal proceedings but will be filing a response in court.

Berg and other former directors were on the losing side of a vitriolic proxy fight that began in mid-December 2023 when the board ousted Gildan CEO/co-Founder Glenn Chamandy following alleged disagreements over a succession plan for a new chief executive officer and reported different views over how to take Gildan forward.

Things got ugly – and expensive – from there.

Activist investors, led by Los Angeles-based investment firm Browing West, spearheaded a charge to reinstate Chamandy. For approximately six months, directors who had booted Chamandy dug in their efforts to keep him from returning, appointing a new CEO/president in Vince Tyra.

There were court filings from both sides and a stream of public statements in which each camp took shots at the other. There was even talk of Gildan possibly being sold to private equity firms.

Ultimately, Chamandy and his backers prevailed. He was reinstated as CEO and board member in May, with 84% of shareholders voting to return Chamandy to the C-Suite. On May 23, 2024, Tyra and the sitting board of directors resigned. As they did, the departing board members announced that talks to sell Gildan had ended. A new board, loyal to Chamandy, took over.

Gildan has reportedly spent $82 million on lawyers, consultants and more related to the proxy fight.

Sales increases and a stock price rise (up about 40% year over year as of Monday, March 17) have followed Chamandy’s return, but results haven’t entirely been a slam dunk.

The vertically integrated apparel manufacturer, which employs about 50,000 people, drove a 2.3% year-over-year sales gain in 2024, tallying $3.195 billion in total company sales. Even so, net income in 2024 was down by 25% year over year, hurt by heightened taxes and heftier expenses, including those tied to the proxy fight.

Based on estimated North American promotional product industry revenue of $739.3 million, Gildan ranked fourth on Counselor’s most recent list of the largest suppliers in the promo market.