Nestlé, the world's largest food company headquartered in Switzerland, has dismissed Chief Executive Officer (CEO) Laurent Freixes after one year in office. The secret romantic relationship with a subordinate was first raised through the internal whistleblower system, and while it was initially denied in the preliminary investigation, it was confirmed as a violation of the company's code of conduct in a re-investigation that included external legal advice.
On the 1st (local time), Nestlé announced in a press release that the board of directors had dismissed CEO Freixes and appointed Philippe Navratil, who oversees the Nespresso coffee brand, as his successor.
CEO Freixes joined Nestlé in 1986 and successfully served as the crisis management head at headquarters during the global financial crisis in 2008. He was responsible for the European and Americas divisions for over a decade. He was appointed as his predecessor Mark Schneider was abruptly dismissed due to poor performance last September.
The Nestlé board explained that this dismissal was an unavoidable measure to uphold the company's core values and governance. The Financial Times reported, "Nestlé began an investigation after multiple reports regarding the CEO and his office romance were filed with the internal grievance system this spring," stating that "initially, the internal investigation concluded there was 'no basis' for the claims, but after a re-investigation with external legal advice, it was concluded that there was a problem."
Meanwhile, Nestlé is facing increased difficulties due to allegations of unauthorized filtration technology use in France and a frozen food recall in the U.S. This sudden CEO change is expected to amplify confusion within the management and burden the company's future operations.