CINCINNATI, Ohio: Kroger CEO Rodney McMullen has resigned following a board investigation that found his personal conduct to be "inconsistent" with company policies, the U.S. grocery giant announced this week.

The conduct in question was not related to financial performance, operations, or reporting and did not involve any Kroger employees, according to the company. However, Kroger declined to provide further details about the nature of the issue.

McMullen's departure follows the collapse of Kroger's planned US$25 billion acquisition of Albertsons, a merger he had defended as a way to better compete with Walmart and Costco. Albertsons has since sued Kroger for an alleged breach of contract related to the failed deal.

The board was alerted to concerns about McMullen's conduct on February 21 and quickly launched an independent investigation, overseen by a special board committee. As a result, McMullen will not receive a 2024 bonus—a notable decision given his $15.71 million total compensation in 2023.

Ronald Sargent, Kroger's lead director and former CEO of Staples, has been named interim CEO while the company searches for McMullen's permanent replacement.

McMullen, who joined Kroger in 1978 and served as CEO for over a decade, oversaw significant stock growth, with shares tripling in value under his leadership. However, his exit leaves the company in a vulnerable position, especially amid uncertainty over its future strategy.

Kroger's shares fell 1.4 percent following the announcement. Legal and business experts believe the transition may not significantly impact operations if the new leadership follows McMullen's established strategy.

"This type of leadership change usually doesn't disrupt a company's performance," said Xu Jiang, a professor at Duke University's Fuqua School of Business. "The interim CEO will likely maintain existing strategies."

McMullen joins a growing list of CEOs ousted for personal conduct violations, including former McDonald's CEO Steve Easterbrook in 2019 and Hewlett-Packard's Mark Hurd in 2010.

Kroger's board has formed a search committee to identify a new permanent CEO as the company prepares to report its fourth-quarter results on March 6. Despite recent turbulence, Kroger expects full-year earnings to surpass previous forecasts.