In a statement, Bed Bath & Beyond said Patrick Gaston, the board's current lead independent director, has been named independent chairman, and five independent directors will step down. The board will be made up of 10 directors, nine of whom are independent and six of whom are women.
The company's co-founders Warren Eisenberg and Leonard Feinstein will retire from the board.
"The transformed board will reflect significant diversity across race, gender and ethnicity, and have an average tenure of less than four years," the company said.
Bed Bath & Beyond also said its board would form a "business transformation and strategy review committee" to "review all aspects of the company's business transformation, strategy and structure."
The stock has risen nearly 54% in 2019 as three activist firms -- Legion Partners, Macellum and Ancora Advisors -- push the company to improve results. Earlier this month, the company posted its first annual loss and sales decline in its history as a public company.
"The company has had multiple discussions with members of the activist group, which is composed of Legion Partners, Macellum Capital Management and Ancora Advisors, and has invited them to participate in the board transformation process and to offer their ideas for business and operational improvement," Bed Bath & Beyond said Monday. "To date, the activist group has declined this invitation, but the company remains open to engaging in constructive dialogue with them.
Shares of Bed Bath & Beyond were falling 3.6% on Monday at $16.79.