Nestlé CEO Mark Schneider has stepped down as head of the world’s biggest food company in a surprise move, to be replaced by group veteran Laurent Freixe.
A statement from the Swiss group said Schneider “decided to relinquish” his role and place on the board.
It comes after a period of underperformance at Nestlé, culminating with a downgrade to full-year growth forecasts in July, as the company admitted prices were falling faster than it expected. Shares tanked in reaction to the disappointing half-year results.
Schneider joined Nestlé eight years ago as the first outsider to take the helm since 1922, joining the group from Germany’s Fresenius healthcare group, where he was CEO.
Freixe, who has worked for Nestlé since 1986, will move from his current role as executive vice president and CEO of the company’s Latin America area to take the top position on 1 September.
Nestlé said Schneider had “actively shaped the company’s portfolio” during his tenure, focusing on high-growth categories like coffee, petcare and nutritional health products.
Schneider said that leading Nestlé for the past eight years had been “an honour”. “I am grateful for what we have achieved, having transformed Nestlé into a future-proofed, innovative and sustainable business,” he added.
“I would like to thank the entire Nestlé community for what we have accomplished together and wish Laurent all the best in his new role.”
Nestlé shares opened almost 3% lower this morning at CHF 86.92 and are down 12% so far in 2024.
“I am privileged to have been given the opportunity to continue building and strengthening Nestlé, and I am excited to take on this responsibility,” Freixe said.
“There will always be challenges, but we have unparalleled strengths, such as iconic brands and products, an unmatched global presence, leading innovation and execution capabilities, and above all, exceptional people and teams. We can strategically position Nestlé to lead and win everywhere we operate.”
Bernstein analyst Bruno Monteyne said the sudden CEO departure raised “many questions”.
“This is not a planned move,” he added. “Mark Schneider made it clear at the last capital markets day, about 18 months ago, and in recent months during meetings, that he was here for the long term.
“It is clearly not his choice either, or he probably would have managed a smoother transition.”
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David Hayes at Jefferies said that after an increasingly difficult year, it was “not a total surprise to see a CEO change”.
He added Freixe would be “a familiar face to investors” thanks to his experience running the European and Americas divisions and also as a contender in the last CEO change in 2016.
“At the time, an outsider in Schneider was preferred to shake things up,” Hayes said. “Freixe’s appointment today to us feels like a sign that the board wants to rebuild Nestlé culture”
Nestlé chairman Paul Bulcke said he had known Freixe for a long time and held him in high regard as “a talented leader with strategic acumen, extensive in-market experience and expertise as well as a deep understanding of markets and consumers”.
“He has demonstrated his ability to deliver results in challenging market conditions,” Bulcke added. “Laurent’s curiosity fuels his passion for innovation and positive change. Laurent is the perfect fit for Nestlé at this time. Under his leadership, Nestlé will further strengthen its position as a dependable, reliable company through consistent and sustainable value creation.
“I would also like to express our gratitude to Mark for his significant contributions to Nestlé and for his outstanding, steady leadership in turbulent times. Mark has been instrumental in the great progress we have made on our sustainability agenda. We extend our best wishes to him in all his professional and personal endeavours.”
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