NEW YORK -- Making a long-awaited move to fortify its top management, Liz Claiborne Inc. said Friday it has named Paul R. Charron, executive vice president of VF Corp., as vice chairman and chief operating officer.
NEW YORK -- Making a long-awaited move to fortify its top management, Liz Claiborne Inc. said Friday it has named Paul R. Charron, executive vice president of VF Corp., as vice chairman and chief operating officer.Charron, 51, who will report to Jerome A. Chazen, chairman and chief executive officer, fills a void left by Jay Margolis, who resigned last July as vice chairman. The appointment, moreover, could eventually define a line of succession at Claiborne.Over the last nine months, analysts had expressed concern about a lack of a successor to steer the company when Chazen, 67, retires. Many had assumed that Margolis was the heir apparent.Although the title of chief operating officer is new, the Charron appointment creates again a three-part top management, which includes Harvey Falk, who continues as vice chairman and president. It would also appear to be a response to criticism from the Wall Street community that the firm needed to beef up its roster of top officials with a seasoned executive from the outside.Chazen, in a phone interview Friday, however, declined to comment on any succession plan, only saying, "We are not thinking of Charron as a replacement but more of a partnership. Right now I have no plans to retire."Chazen has been with the firm since 1977, the year after it was founded by Elisabeth Claiborne Ortenberg -- known professionally as Liz Claiborne -- her husband Arthur Ortenberg and Leonard Boxer. All three founders have been retired for several years.Chazen said that he picked Charron, who spent six years at VF Corp. because of his "strong marketing and consumer background."At VF, Charron served as a group vice president until March 1993, when he was promoted to executive vice president, overseeing sportswear -- including the Marithe & Francois Girbaud line and the Jantzen division -- and the domestic and overseas intimate apparel businesses, whose prime brand is Vanity Fair. He also oversaw the Healthtex and Cutler children's wear, Red Kap occupational apparel and VF's factory outlet operations.VF said Friday that Mackey J. McDonald, president and chief operating officer, will assume Charron's responsibilities. McDonald moved up to president from group vice president also in March 1993.Chazen noted that one of Charron's strengths was in the fashion jeans business, an area that Liz Claiborne is trying to grow at LizWear, part of the company's $1.2 billion sportswear division. The division also includes Collection and LizSport. Chazen also cited Charron's expertise in Quick Response -- one of VF's key strategies -- and his experience with the big moderate-price chain retailers, to whom Liz Claiborne is now marketing the Russ Tog labels it took over last year.Charron, who will join Claiborne in about two weeks, comes on board at a time when the company is attempting to fight its way out of a profit tailspin. In 1993, the firm saw earnings drop 42 percent to $126.9, million, while sales edged ahead only 0.5 percent, to $2.2 billion.Analysts generally saw the Charron appointment as a positive move. Although several doubted whether there is a line of succession actually set at this point, analysts generally say that Falk, 59, a numbers-oriented executive, is not a likely candidate for the top slot."I think they are testing Charron to see whether he could work as Chazen's successor," noted one analyst who did not want to be identified. Another analyst who also requested anonymity said she thought Charron was a good executive, but: "I don't think he's a fashion maven. He's more marketing- and sales-oriented than product-oriented. VF is a manufacturer of basic fashion. Charron doesn't have a strong background in fashion."Todd Slater, an analyst with UBS Securities, said: "While Charron is, without a question, an asset to Liz Claiborne because of his VF background, the appointment still doesn't solve the company's problems. They still need some sort of creative solution."Liz Claiborne has to defend its market share, especially in casual sportswear, and Jones Apparel Group is going after it," added Slater."Charron is coming to Liz Claiborne with great credentials," said Edward F. Johnson of Johnson Redbook Service. "VF serves as a good training ground because it is bottom-line oriented. He is also going to bring a cost-cutting mentality to the company."Elisabeth Claiborne Ortenberg, who at the time of Margolis's resignation expressed dismay at his leaving and dissatisfaction with the way the company was being run, said through a spokeswoman Friday that she and her husband had no comment on Charron's appointment. Margolis is now president and vice chairman of Tommy Hilfiger.Charron, before joining VF Corp. in June 1988 was president and chief operating officer at the Minnesota-based Brown & Bigelow, a specialty advertising firm. He also was senior vice president of sales and marketing at Cannon Mills Co., and worked in marketing management positions at General Foods Corp.
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