News: Danone board ousts Faber as chairman and CEO after activist pressure.
PARIS (Reuters) – French food giant Danone’s board of directors said Monday that Emmanuel Faber would step down as chairman and CEO as the group tries to draw a line amid a management crisis and mounting pressure from shareholders.
Faber, who recently announced that he would be leaving his role as CEO but would continue to serve as chairman to appease critics, will be immediately replaced by recently appointed director Gilles Schnepp in the non-executive chairman’s seat.
“The new Chairman’s immediate priority, along with the Board of Directors, will be to lead the transition, including finding a new CEO. Danone has appointed an international search agency to assist in the process, ”the group said in a statement.
Danone had come under pressure in recent months from several shareholders, including mutual fund Artisan Partners and activist investor Bluebell Capital, who were demanding that Faber leave the company and the group improve returns.
They had also campaigned for Schnepp, who previously ran the electrical company Legrand and was appointed to Danone’s board in December, as a desirable candidate for chairman.
The sudden shock puts Danone under pressure to quickly find a new CEO.
“Of course, the ‘job’ starts now with the board of directors as a high-profile CEO is appointed,” Bluebell said in a statement late Sunday, adding that he was satisfied with the results so far.
“We are confident that under Mr. Schnepp’s leadership, Danone will regain profitable growth that will continue to focus on sustainability.”
Investors had pointed to Danone’s poor stock market performance and weaker sales growth than some of its competitors over the past year, and criticized some strategic decisions and Danone’s low investments in areas such as marketing.
Problems at the world’s largest yogurt maker, which also makes bottled water from Evian, were exacerbated by the COVID-19 pandemic, which, for example, affected sales to the restaurant sector.
Faber, who has been CEO since 2014 and later assumed the chairmanship, advocated environmental issues and more sustainable business practices and made him a supporter among some employees.
However, recent changes in management and an organizational overhaul had led to divisions among the board members.
Reporting by Sarah White and Gwenaelle Barzic; Adaptation by Stephen Coates and Louise Heavens
Original Source © Reuters