That kind of problem can be cause by mulch, by chronic weedeater or mower damage, by irrigation head misplacement, and other factors.

No mower near that spot. Mulch yes. What should I do about it?

The damage is done, so there's not much to do now except maybe think about removing the tree if it's in an area where it would do damage or possibly hurt someone if it were to fail. This damage isn't new. Most of the trunk in your photo is dead and you can see the new live wood slowly growing around it on the left hand side of the photo(the swollen looking, rounded part). You could clean up the dead loose bark shown in the photo and apply liquid copper fungicide as described in this thread. Also, keep mulch at least 4 to 6 inches away from the trunks of any trees and do not pile mulch up around them like is often seen in commercial landscapes. It causes lots of rot and disease issues and eventual tree failure.