Ex-CEO Glenn Chamandy finds his record scrutinized as Gildan’s shareholders mull leadership change

On a sunny Thursday in late February, Glenn Chamandy held court in front of a room of business people at Manhattan’s posh Rainbow Room supper club and pitched his vision for Gildan Activewear Inc. GIL-T, the T-shirt manufacturer he co-founded 40 years earlier.

In the audience were investors from the Los Angeles-based investment firm Browning West, one of Gildan’s largest shareholders with a roughly 5-per-cent stake in the company.

In a 45-minute, fireside-style exchange with Browning’s founders, the silver-haired Montrealer laid out his plan for growth, his commitment to success and his devotion to the company his family founded.

To those in the crowd, it was an inspiring presentation by a passionate executive – except Mr. Chamandy was no longer running Gildan and he hadn’t been for more than two months.

On Dec. 11, Gildan’s board shocked the market by announcing that Mr. Chamandy had “left his position” as chief executive officer after 20 years in the role. Vince Tyra, a former president of Fruit of the Loom and past CEO of apparel distributor Broder Bros. Co., was taking over.

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The revolt was instantaneous.

Two of Gildan’s largest shareholders – Browning West and Toronto-based Turtle Creek Asset Management – released statements lambasting the board’s judgement.

Nine institutional investors holding an estimated 35 per cent of Gildan’s stock demanded Mr. Chamandy be reinstated. Browning West launched a campaign to take control in order to bring the ousted CEO back.

In the days and weeks that followed, the activist campaign touted the Gildan co-founder’s long track record of strong returns. They attacked Mr. Tyra as being out of his depth and accused the board of having not done its due diligence.

For its part, Gildan accused the disgruntled investors of unfairly slinging mud at Mr. Tyra. They countered that Mr. Chamandy was removed because he had been an absentee CEO who was out of ideas for how to grow the company.

Gildan’s global manufacturing footprint

North

Carolina

United States

Bangladesh

India

Gulf of Mexico

Dominican

Republic

Mexico

Cuba

Honduras

Haiti

Guatemala

Nicaragua

El Salvador

Venezuela

Presence in country

Factories

Colombia

Dedicated contractors

Number of facilities by type

Factory

Dedicated

contractors

Honduras

8

1

North Carolina, USA

7

Nicaragua

4

2

Haiti

5

Dominican Republic

3

El Salvador

1

Guatemala

1

The Globe And Mail, Source: Openstreetmap; Gildan

Gildan’s global manufacturing footprint

North

Carolina

United States

Bangladesh

India

Gulf of Mexico

Dominican

Republic

Mexico

Cuba

Honduras

Haiti

Guatemala

Nicaragua

El Salvador

Venezuela

Presence in country

Factories

Colombia

Dedicated contractors

Number of facilities by type

Factory

Dedicated

contractors

Honduras

8

1

North Carolina, USA

7

Nicaragua

4

2

Haiti

5

Dominican Republic

3

El Salvador

1

Guatemala

1

The Globe And Mail, Source: Openstreetmap; Gildan

Gildan’s global manufacturing footprint

North

Carolina

United States

Bangladesh

India

Gulf of Mexico

Dominican

Republic

Mexico

Cuba

Honduras

Haiti

Guatemala

Nicaragua

El Salvador

Venezuela

Presence in country

Factories

Colombia

Dedicated contractors

Number of facilities by type

Factory

Dedicated contractors

Honduras

8

1

North Carolina, USA

7

Nicaragua

4

2

Haiti

5

Dominican Republic

3

El Salvador

1

Guatemala

1

The Globe And Mail, Source: Openstreetmap; Gildan

Gildan, one of the world’s dominant apparel companies with more than US$3-billion in annual revenue, has seen sales growth slow in recent years, with its share price struggling to maintain momentum after peaking in December, 2021. Its attempts to push into the retail space have been unsuccessful and a series of acquisitions on Mr. Chamandy’s watch fell flat.

Moreover, Gildan – which billboards its commitment to ESG as one of its three core pillars – is facing mounting criticism of its business practices abroad. The company built an empire on a foundation of cheap labour in developing countries. Consumers were promised that workers were treated well, respected and compensated fairly. But labour advocates say there is growing evidence that this is no longer the case, pointing to recent incidents in Honduras, where Gildan opened its first factory abroad.

Last year, Honduras’s Supreme Court of Justice determined that Gildan had violated the country’s labour laws. It ordered the company to rehire five workers who had been unlawfully terminated years earlier. This was the first in a series of events – events that culminated in a massacre that left union leaders from one of Gildan’s factories dead – that advocates say should be a wake-up call.

It is against this backdrop that Gildan’s messy public succession battle has played out. A recent attempt by the company to turn down the temperature with a board refresh – replacing five directors, including the chair – did little to assuage the activist campaign.

In the coming weeks, shareholders will be forced to pick a side ahead of Gildan’s annual general meeting on May 28. In many ways, that choice is a referendum on the man who built the company.

With Gildan’s business at a crossroads, the question for investors is: Can Mr. Chamandy replicate his early success or is it time to move on?

Glenn Chamandy was born into the apparel business.

In 1946, his grandfather, Joseph Chamandy, launched a clothing company in Montreal that made kids’ basics, activewear and sleepwear. He named the business Harley after Glenn’s father. The real Harley died at the age of 29 of cancer, so Joseph’s grandsons – Glenn and his brother Greg – took over the company in 1982. Glenn was in his first year of university, and Greg was in his third.

For them, job one was to reduce costs. The Chamandys believed Harley was losing money by outsourcing steps in its production. A big part of their business was screen printing characters such as Batman and Superman onto their apparel, so in 1984, the Chamandys asked their printing partners – Gilbert and Daniel Ayoub – to join forces.

This new company would be named Gildan – an amalgam of the Ayoubs’ names. The Chamandys then purchased machines to start their own fabric production and later that decade, bought a facility that had knitting and dyeing capabilities.

These moves were Gildan’s first foray into vertical integration, which occurs when a business owns multiple steps in its supply chain. This concept became integral to Gildan’s growth.

The Ayoub and Chamandy partnership fizzled after a few years, but Gildan carried on under Glenn and Greg.

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Through the early 1990s, the Chamandys hit the American trade-show circuit, giving away apparel and pitching the company to distributors. Back then, the screen-printing business was dominated by Fruit of the Loom and Hanes. But the shirts were essentially underwear with no additional features, such as higher-grade material and nicer tailoring. Wholesale shirts weren’t like the ones sold in a brick-and-mortar shop.

“Gildan was one of the first companies to say: How do we bring in retail quality, and sell it at the same price?” said Garry Bell, who was working at Hanes before being poached by Gildan.

The first step was focus.

Rather than spread themselves thin, Gildan concentrated on a handful of products – mostly 100-per-cent cotton, tubular T-shirts, which are shirts with no side seams – in a limited array of colours. From there, it went after big markets and made sure its distributors weren’t in competition with one another.

Gildan’s product was superior, but it charged less in order to catch the attention of buyers and pull market share. The company was highly leveraged, but the strategy was working. And as demand surged, costs went down.

“In 1992, we sold $20-million worth of T-shirts. In 1993, we sold $46-million. And then in 1994, we sold $85-million,” Mr. Chamandy told The Globe and Mail in an interview. With demand soaring, Mr. Chamandy said they raised money to expand the business by selling a 30-per-cent stake in Gildan to the FTQ Solidarity Fund, the investment arm of the Quebec Federation of Labour.

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During those years, Gildan was on a hiring spree, stealing senior employees from the big American brands – including Mr. Bell.

Mr. Bell remembers visiting Montreal before taking the job. Mr. Chamandy took him on a tour of the factory. Mr. Bell had been at Hanes for five years and never seen a knitting machine before, but at Gildan, Mr. Chamandy wanted everyone to have insight into all aspects of the business. Mr. Bell remembers being shown a machine that had been turned off. Mr. Chamandy explained it had been running for 2,400 hours, which is when needles start breaking, causing fabric defects.

“So instead of waiting for that to happen, he changed the needles. He wanted to be able to sell every metre of fabric,” said Mr. Bell, who retired in 2019 as vice-president corporate marketing and communications. “At the time I thought they were really cost conscious but in today’s world, that same practice would be considered ‘sustainable.’... It gave me confidence that they knew how to run a good business.”

Gildan also took advantage of an agreement between Canada and Barbados that permits Canadian international companies to avoid paying significant taxes in their home country, provided certain conditions are met. The arrangement is legal, but controversial.

Pension fund giant Caisse de Dépot et Placement du Québec used to be one of Gildan’s largest shareholders, but the public body sold its stake in 2022 over disagreements with Gildan’s tax strategy. (Gildan’s latest annual report shows its average income tax rate in 2023 was 5.4 per cent globally.) Last week, the Caisse inserted itself into Gildan’s leadership battle by announcing it will lend the T-shirt manufacturer $200-million, which Gildan plans to use to buy back shares and pay down debt, while supporting the board and Mr. Tyra, the new CEO.

In these years of growth, Mr. Chamandy ran the day-to-day operations while Greg focused on the finances and potential acquisitions. (Greg left Gildan in 2004, leaving Glenn as CEO.)

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Numerous former Gildan executives who spoke to The Globe said what Mr. Chamandy did so well during Gildan’s early years was constantly reinvest any profits into new equipment and more efficient technologies. He wasn’t afraid of making big bets and spending when it was needed, they said.

The best example was Gildan’s expansion into Honduras. This move was the key to providing retail quality T-shirts at wholesale prices.

The company chose Honduras for a number of reasons: It wasn’t just that labour was dramatically cheaper, it was that there was an abundance of workers who wanted the jobs. Additionally, the country was close to raw materials, and there were well-established shipping routes to the American market, thanks to the food industry.

Gildan wasn’t the first manufacturer to go offshore, but it was the first to make major capital investments in factories, rather than use subcontractors, said Mr. Chamandy. Gildan did this after the United States passed its “807″ law, which changed the way tariffs were assessed on textiles. The new law gave an advantage to Gildan’s American competitors, so Mr. Chamandy got around this by looking to Central America and, later, the Caribbean Basin.

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In 1997, Gildan took its first steps outside Canada by opening a small sewing plant in San Pedro Sula, Honduras. The facility was a test run for the brothers’ dream of building a $100-million, vertically-integrated textile megafactory.

The following year, Gildan went public, hoping to secure enough capital for a massive push into Honduras. But this initial public offering faltered.

“There was a lot of skepticism about the company,” said Laurence Sellyn, Gildan’s long-time chief financial officer. Mr. Sellyn was recruited shortly after the IPO. “We had tremendous difficulty to get financing to build our factory in Honduras. And that’s where I come in.”

On his first day, Mr. Sellyn was on a plane to pitch fund managers. He secured debt financing deals with a syndicate of banks and insurance companies. Gildan issued a second round of shares. Little by little, it cobbled together enough cash to build its megafactory, which combined all the different elements of textile production – knitting, bleaching, dyeing and cutting – in one place.

“It was a game changer,” Mr. Sellyn said, adding that the company jumped from 10 to 75 per cent market share. “Once we had it, we never looked back. ... Our costs were so much lower and we generated so much cash flow that we could reinvest.”

The company quickly added half a dozen more factories in Honduras and then another in the Dominican Republic. By 2006, Gildan was shutting down factories in the U.S. and Canada and shifting south. Today, Gildan has factories in a dozen countries.

That transition wasn’t without bumps, however.

In 2008, Gildan was hit with a $500-million class-action lawsuit that alleged the company had seriously misled investors about “severe problems” at its Dominican Republic factory. A statement of claim, which was never tested in court, alleged that Gildan made false or misleading statements to investors in late 2007 and early 2008 about the factory’s production, causing stock prices to rise. Meanwhile, in the latter half of 2007 through to December, Mr. Chamandy and his holding company sold shares worth about US$95-million, the lawsuit alleged.

The stock price then plummeted by 30 per cent in April, 2008, after Gildan acknowledged the Dominican factory production problems in a corrective press release. The company settled for US$22.5-million, with Gildan admitting no wrongdoing. Mr. Chamandy said he and the company did nothing wrong and were confident they would have won the case, but the insurance company wanted to settle.

Class-action problems aside, the cost savings from going offshore were astronomical. According to Mr. Chamandy, when Gildan sold its first T-shirts, they went for about US$30 a dozen. By 2001, when Fruit of the Loom was going through its U.S. bankruptcy, Gildan T-shirts cost US$12.50 a dozen.

So how is it possible to sell T-shirts for a buck apiece?

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For years, Rosa Dalila López Corea sat curled over a sewing machine in Gildan’s San Miguel factory in Honduras, four days a week, 11 and a half hours a day, finishing the bottom hems of shirts.

The factory is divided into teams and each group has a daily quota. Ms. López Corea and her team of 20 or so women had to complete 500 dozen shirts a day. To hit this target, Ms. López Corea says she worked through breaks and drank as little as possible to avoid going to the bathroom. A point of pride for Gildan is that it provides free lunch for its factory staff, but Ms. López Corea said only those who hit quotas receive a lunch ticket. (Another worker confirmed this.)

As of last year, Ms. López Corea took home around 2,600 lempiras a week – about $143 – when she hit her goals, a 2023 pay stub viewed by The Globe showed. Employees who missed targets were paid less and endured harsh rebukes from managers, she said.

Ms. López Corea began working for Gildan in 2005, during a sensitive time at the company.

Three years earlier, the CBC had aired an investigative report questioning Gildan’s labour practices. Then in 2003, the Toronto-based Maquila Solidarity Network, in partnership with the Honduran Independent Monitoring Team, released a report alleging serious abuses: ruthless union-busting tactics, crippling production pressure, health and safety issues, and forced pregnancy tests.

Workers – most of whom were women – reported being required to take urine tests pre-employment and then again two months into the job, which they believed was to screen for pregnancy. They alleged those who tested positive were fired. (Gildan said at the time this was to screen for drugs, not pregnancy, although this also raised questions of fairness for MSN.)

That year, the FTQ Solidarity Fund sold its 11-per-cent stake in Gildan and withdrew its representative from the company’s board of directors over concerns about anti-labour practices.

Initially, Gildan threatened legal action against MSN.

Mr. Sellyn, who handled the fallout from the report, said he can’t remember Gildan making any serious legal threats, but he acknowledges the initial relationship was adversarial as Gildan did not agree with many of MSN’s findings. After some reflection, Gildan engaged with MSN.

“We brought them down to Honduras. … Let them talk to anybody. We implemented recommendations they made that we felt were reasonable,” Mr. Sellyn said. “We were very proud of our labour practices.”

By early 2005 – the year Ms. López Corea started her job – MSN announced it was dropping its campaign against Gildan, satisfied that the company had made significant improvements. The most meaningful change, Bob Jeffcott, one of MSN’s founders, told The Globe was that Gildan stopped fighting unionization.

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Ms. López Corea said that when she took her job, she knew it would be physically demanding, but there weren’t many options in her region and the pay was better than the local grocer, where she had been helping out.

“Gildan didn’t request any diplomas and studies and they also don’t ask about age. In Honduras, it’s very difficult to get a job if you’re over 30,” the now 52-year-old said through an interpreter.

Miguel Medina, Honduras’s Minister of Investment, told The Globe that Gildan is one of the country’s largest employers. Not only does the company provide stable employment and solid wages for the thousands of workers employed in its factories, but there is the trickle-down impact in surrounding communities. (Gildan employs around 14,000 people in Honduras today, Mr. Chamandy said.)

“There are lines and lines of people trying to get those jobs. If you were to remove Gildan, it would be a huge hit to Honduras,” Mr. Medina said.

But therein lies the tension: Ms. López Corea was both grateful for the job and miserable at work.

The constant repetitive movements at the sewing machine caused pain and numbness in her arm, hand and shoulder, she said. In 2009, Honduras’s technical commission on occupational risks diagnosed Ms. López Corea with left omalgia and later scapulothoracic dyskinesia, court documents show. Gildan touts the fact it makes doctors available to its factory workers, but Ms. López Corea said that when she went to the company-provided doctor for help, he would “give an injection for pain so I could go back to work.”

Then, about seven years ago, after Ms. López Corea required further accommodation at work following surgery for an unrelated issue, she and 150 others were laid off. Gildan has said the terminations were part of a restructuring at one of its sewing facilities. Ms. López Corea believes she and others were targeted because of their injuries.

That year, la Colectiva de Mujeres Hondureñas – a women’s labour organization in the country – spearheaded a court challenge against Gildan on behalf of Ms. López Corea and four other injured women who had been laid off. The case went all the way to Honduras’s Supreme Court and in early 2023, Gildan was ordered to reinstate all five.

In a statement to The Globe, Gildan noted that the Supreme Court’s decision related to labour rights, not safety, and that each of the five women were rehired with back pay.

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However, Ms. López Corea says she was back on the job just four months before she was terminated again.

It was June 21, 2023. Around 4:30 p.m. – two hours before the end of the shift – a manager came over the loudspeaker and read from a prepared statement: The San Miguel sewing plant would close, leaving 2,700 workers without a job.

“People were crying. Some people fainted,” Ms. López Corea said. “It made me feel horrible. I am a single mother.”

Gildan told The Globe that 408 of the San Miguel employees have been rehired in other facilities. Ms. López Corea remains unemployed.

Nadia Revelo, the human and labour rights program director at CoDevelopment Canada, said the sad reality is that laid-off employees struggle to find other jobs.

“As companies race to the bottom and lay off workers who have developed injuries and illnesses on the job, workers are abandoned and left vulnerable, deemed unemployable – due to presumptions of injuries – by remaining maquila companies,” she said.

Perhaps even worse for Ms. López Corea: Her colleagues blamed her. Many believed that Gildan had closed the factory to avoid having to accommodate injured workers. This sentiment was expressed in a memo sent to Mr. Chamandy when he was still CEO by the Canadian Union of Public Employees, Canada’s largest union.

“Workers see the targeted closure of the San Miguel factory as possible retaliation for successful organizing and activism,” wrote CUPE national president Mark Hancock and national secretary-treasurer Candace Rennick.

Gildan has said the decision was strictly because of market conditions. According to Mr. Chamandy, costs in Honduras are now 60 per cent higher than in neighbouring Nicaragua – mostly because of labour. He said the San Miguel closing was years in the making and is part of an overall shift to move more labour-intensive work, such as sewing, to Nicaragua. The company has also started a major push into low-cost Bangladesh and hopes to recreate the boom times of the early 2000s there.

For workers, the economic explanation was cold comfort.

And then, four days after the San Miguel closing, tragedy struck. Four members of the factory’s union, including president Xiomara Cocas, were gunned down in a pool-hall massacre along with nine others. Five men were arrested following an investigation. Police told The Globe that the killings were a result of a territorial dispute between rival gangs and were not connected to Gildan in any way. But among workers, another narrative has taken hold.

“The murders may be linked to false rumours that the union was responsible for the announcement last week that the Gildan textile plant in the town of San Miguel would be closed,” the International Trade Union Confederation, which represents 191 million workers around the world, said in a statement at the time.

In the release, acting general secretary Luc Triangle noted that death threats, attacks and intimidation against union members in Honduras is common. “Honduras has an appalling record of killings, intimidation and violence against workers and their unions, with hundreds of murders remaining unsolved over several years.”

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Meanwhile, Gildan said it stands by its labour record.

The company has made the Dow Jones Sustainability North America Index for 11 consecutive years. It said it is the first vertically integrated apparel manufacturer to have its social-compliance program accredited by the Fair Labor Association.

“The health and safety of our employees is of paramount importance,” Gildan spokesperson Geneviève Gosselin said in a statement. “We recognize our responsibility to contribute to a higher standard of living for our employees by offering benefits that help better meet their overall needs, such as free on-site medical clinics, vaccination and medicine programs, parental leave, financial assistance, subsidized meals, and free transportation to and from work.”

But labour advocates point to the recent events in Honduras as evidence that Gildan is once again losing its way.

Emma Pullman, the head of shareholder engagement and ESG at BC General Employees’ Union, a Gildan investor, said the company’s actions abroad aren’t just a concern for human-rights watchdogs. They also raise serious financial and reputational risks for Gildan.

“More and more, consumers and investors alike are holding companies accountable for their actions globally,” Ms. Pullman said. “On paper, Gildan has exemplary labour-related disclosures that would make any investor proud. So how is it that the reality conveyed by workers tells such a different story? As a responsible investor, it’s our duty to probe the company and try to understand this concerning discrepancy.”

At Gildan’s annual general meeting, investors won’t just be deciding the company’s CEO. They will be asked to vote on a shareholder resolution from the B.C. trade union requesting that Gildan evaluate the effectiveness of its human-rights infrastructure given the recent allegations made by workers, Ms. Pullman said.

One of the central mysteries in the Gildan saga concerns why and when the company decided to part ways with its co-founder.

After informing Gildan’s board in May, 2021, that he planned to retire within three to five years, Mr. Chamandy agreed to a succession plan that would see him step down as CEO in December, 2024, and retire from the company after a transition period with the new CEO, Gildan said.

Mr. Chamandy remembers things differently: “There was never any timeline or anything suggesting that I was leaving.”

What is clear is that in September of last year, what had been a cordial relationship between the board and Mr. Chamandy blew up. When directors informed him that they would soon start speaking to external CEO candidates, then chairman Don Berg said Mr. Chamandy snapped. He said the CEO expressed his opposition to the direction and vowed to sell his Gildan stock.

This fight over Mr. Chamandy’s future dovetailed with a question that the board had been grappling with for years: What was next for Gildan?

Gildan’s strong performance had largely stalled. The stock price had gone sideways since 2019. What had been double-digit growth in sales and profits gave way to single-digit increases in key financial metrics for the dominant company in a slow-growth sector. As Gildan shifted down to simply respectable expansion, investors downgraded their valuations on the stock from more than 20 times the company’s earnings per share five years ago to about 12 times earnings today. Valuations on Gildan’s peers also fell.

In an interview, Mr. Chamandy said: “If you look at our proxy group or our direct competitors, we’ve outperformed everybody.”

Directors say they challenged Mr. Chamandy to find the ingredients for the next leg of growth, but he offered little, which raised the question of whether the founder was still the right person to lead Gildan. One former senior executive, who The Globe is not naming because they still work in the industry and fear career repercussions, said Gildan’s best chance is retail, but Mr. Chamandy is a manufacturing guy who hasn’t broken into the retail market. (Mr. Chamandy defended his retail record and said the market has changed considerably in recent years.)

His track record on acquisitions is far from stellar, said Morningstar analyst David Swartz. The purchase of T-shirt makers Anvil Holdings Inc. in 2012 and Comfort Colors in 2015 amounted to Gildan buying out competitors and had mixed results. Other deals for branded businesses such as sock maker GoldToe Moretz and Peds Legwear Inc. haven’t yielded the expected benefits either, Mr Swartz said.

“None of them have become anything worth noting,” Mr. Swartz said. “And you’ve got to say that Chamandy is partly to blame for that.”

Gildan also snapped up Los Angeles-based retailer American Apparel out of bankruptcy protection in 2017, an awkward transaction that saw a brand tainted by a sex scandal land at a company that makes kids’ hoodies and adult compression socks.

“It hasn’t really come back,” the analyst said. “Most people probably have no idea that it even still exists.” In a statement, Gildan’s Ms. Gosselin said the company is “pleased with the acquisition of American Apparel. The brand has a significant following and customers have been excited about its recent repositioning.”

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Last October, Mr. Chamandy presented a long-range plan to Gildan’s board that he now dismisses as a routine exercise. One possible path was to stay the course and attempt to grow on its own, though this option had limited potential and would result in profit-margin erosion.

Instead, the board said he proposed one or more multibillion-dollar acquisitions. He walked them through the possible scenarios, including buying competitor Hanesbrands Inc. and two major clothing distributors – a business Gildan knew little about.

The catch was that the M&A work had to start within six months, meaning he would have to stay on as CEO for at least another two years to oversee the takeovers. The deals would load Gildan up with debt – and further tie the board to Mr. Chamandy even though their faith in him was growing shaky.

“He made it very clear. He was the only man who could run Gildan,” former director Luc Jobin said. Meanwhile, the board considered the 30 pages of acquisition proposals a reckless move that would require extensive analysis to flesh out.

Mr. Chamandy said his October presentation was a sketch of potential options and not a must-do acquisition strategy. But Mr. Berg said it confirmed the board’s suspicions that Mr. Chamandy had run out of mental muscle to drive Gildan forward. He was a “part-time CEO” anyway, Mr. Berg said, because he was distracted by personal pursuits such as golf.

In his interview with The Globe, Mr. Chamandy said this was flat out false. “I’m 100 per cent engaged in the company. I’m 24/7. If you speak to any of the existing employees, they will tell you that I’m relentless. I work 24/7,” he said.

As investors consider their leadership choice, there’s no guarantee that Mr. Tyra will be able to do better.

Gildan has mastered manufacturing print wear, Mr. Swartz said. But COVID-19 proved that business doesn’t always have great visibility. Sales dropped off in tandem with social and sporting events, and group gatherings. Meantime, making private-label clothes on contract for retailers such as Walmart is not a particularly stable business. The bottom line is that it might take a miracle to grow Gildan’s top line, no matter who is CEO.

“If you look at my financial model, I’ve got the company generating 2-per-cent annual growth for the next 10 years,” Mr. Swartz said. “I don’t see a way that this company really has a growth profile.”

Still, Mr. Chamandy has his supporters. On Bay Street, Turtle Creek Asset Management has urged Gildan’s board to “check their egos and end the drama” by reinstating him. Browning West has said Mr. Chamandy deserves a chance to take Gildan to the next level, noting that under his leadership, Gildan generated extraordinary returns for shareholders, with the share price increasing almost 100-fold.

“This is my legacy. This is the company that I’ve built,” Mr. Chamandy said on why he wants to come back as CEO. “The standard investor question, Investor 101, they ask you ‘What keeps you up at night?’... What kept me up at night was the thing I did not control. And that was the board itself. ... My worst nightmare actually happened.”

With reports from Stephanie Chambers

The Gildan saga: More on The Decibel

Reporter Robyn Doolittle has been looking beyond Gildan’s boardroom drama to learn about its track record in Honduras, and the tension in the clothing industry between low prices and ethical labour. She spoke with The Globe’s news podcast about what she learned. Subscribe for more episodes.