Nestlé has dismissed chief executive, Laurent Freixe, with immediate effect after an investigation into an “undisclosed romantic relationship”, and appointed Nespresso head, Philipp Navratil, as his replacement.
The Swiss consumer goods company said on Monday that the departure of Freixe, who was promoted to chief executive last August after almost 40 years with Nestlé, came after a probe into a relationship with a direct subordinate that breached its code of business conduct.
Nestlé’s chair, Paul Bulcke said: “This was a necessary decision. Nestlé’s values and governance are strong foundations of our company. I thank Laurent for his years of service at Nestlé.”
The SFr191bn ($238.6bn) group behind brands including Kit Kat and Nescafé first launched an investigation into Freixe’s personal relationship with a colleague in late spring after a number of reports were made through Nestlé’s internal complaints system called “Speak Up”.
Staff raised concerns about potential conflicts of interest and favouritism, said people familiar with the matter.
Last month, Nestlé told the Financial Times that, following the internal investigation, it found the claims were “unsubstantiated”.
However, after internal complaints persisted, the Nestlé board subsequently decided to launch another investigation with the help of external counsel. This found the claims to be substantiated, said a person briefed on the situation.
Freixe’s departure, after only one year on the job, adds more upheaval in what has been a difficult year for Nestlé, as it contends with slowing sales in its core businesses.
Shares in Nestlé fell 3.2 per cent to SFr73 in early trading on Tuesday. They have slumped more than 40 per cent since hitting a high of SFr127 in 2022.
French authorities raided Nestlé’s offices in July as part of an investigation into the company’s alleged use of unauthorised filtration methods in its bottled mineral water. The company also had to issue a recall of frozen meals in the US this year over contamination concerns.
Since replacing Mark Schneider as chief executive of the group, which has a sprawling portfolio of more than 2,000 brands spanning coffee and confectionery to petcare, Freixe had been trying to refocus Nestlé on its core businesses and restore a company culture he felt had been lost.