Nestlé says it has dismissed its chief executive, Laurent Freixe, after uncovering that he failed to disclose a romantic relationship with a direct subordinate in a violation of corporate policy.
Freixe will be succeeded by Philipp Navratil, who was previously chief executive of Nestlé Nespresso.
Freixe, a four-decade fixture of the Swiss food and beverage giant, was tapped for the role one year ago to revive growth after a period of sluggish performance under his predecessor, Mark Schneider.
Nestlé said board chairman Paul Bulcke and Pablo Isla, an independent board member and the former Zara chief executive, oversaw the investigation with the support of outside counsel. Bulcke framed the dismissal as both necessary and symbolic of Nestlé’s standards, while expressing gratitude for Freixe’s tenure.
“This was a necessary decision,” Bulcke said in a statement. “Nestlé’s values and governance are strong foundations of our company. I thank Laurent for his years of service at Nestlé.”
Business Insider has reached out to Freixe for comment.
The boardroom drama arrives during a critical period for Nestlé. The company enjoyed a pandemic-era boom as consumers stocked up on staples to eat and drink at home, but that momentum has vanished. In July, Nestlé reported a 1.8% drop in half-year group sales, to 44.2 billion Swiss francs, roughly $55 billion, reflecting softening consumer demand.
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Shares of the stock have slid nearly 40% from its high-water mark in early 2022.
When Freixe took over as the Nestlé chief last August, he made clear that his mandate was to refocus the company on its core strengths — coffee, petcare, and food — rather than chasing diversification. In an interview with The Financial Times in May, he criticized his predecessor Schnieder’s expansion into health supplements and other new categories, arguing that it had “weakened the fabric of the organisation.”
Schneider was only the second outsider to run Nestlé in its 159-year history. Freixe cast himself as the consummate insider — a nearly 40-year veteran who climbed the ranks through posts in Hungary, Spain, and Latin America.
Freixe told the FT that what set him apart was his “intimate” knowledge of Nestlé’s inner workings. “Because of that, and maybe my style, I’m very close to the people, so it’s a big advantage,” he said.
Nestlé has tapped another longtime employee as Freixe’s replacement. In a statement, the board chairman recognized Navratil for his aptitude for getting results and his “collaborative” style.
“We are not changing course on strategy,” Bulcke wrote, “and we will not lose pace on performance.”
