Paragraph 1: The Dismissal and its Cause
Nestlé, the Swiss multinational food and beverage giant, abruptly dismissed its chief executive, Laurent Freixe, on Monday, citing a violation of the company’s code of business conduct. The dismissal stemmed from an undisclosed romantic relationship between Freixe and a direct subordinate, a situation deemed unacceptable according to Nestlé’s internal regulations. The company’s statement emphasized the seriousness with which it viewed the matter, highlighting its commitment to upholding its values and governance principles. This swift action underscores the increasing scrutiny placed on workplace relationships, particularly those involving power imbalances, and the growing intolerance for behavior that could potentially compromise professional ethics. The dismissal serves as a reminder that even senior executives are not exempt from the rules and regulations governing workplace conduct.
Paragraph 2: The Investigation and Board’s Response
Following the discovery of the relationship, Nestlé’s board of directors initiated a comprehensive investigation, overseen by chairman Paul Bulcke and lead independent director Pablo Isla, with the assistance of external legal counsel. This thorough process demonstrated the board’s commitment to transparency and due diligence in addressing the matter. The investigation culminated in the decision to terminate Freixe’s employment, a decision characterized as “necessary” by Bulcke, reinforcing the company’s unwavering stance on upholding its ethical standards. The involvement of independent directors and external counsel further underscores the board’s commitment to objectivity and impartiality in the investigation process.
Paragraph 3: Freixe’s Career and Recent Appointment
Laurent Freixe had a long and established career within Nestlé, having joined the company in France in 1986. He held various leadership positions, including overseeing European operations during the challenging period of the subprime and euro crises. His experience and expertise led to his appointment as CEO of the Latin America division before his promotion to the top job in a surprise move in September 2024. This rapid ascent to the CEO position underscores the high regard in which he was held within the company prior to the revelation of the relationship that led to his dismissal. His task as CEO was to address declining consumer spending on Nestlé’s products, a significant challenge considering the company’s vast portfolio of household brands.
Paragraph 4: Nestlé’s Performance and Share Price
Nestlé, known for its iconic brands like Nespresso, KitKat, Purina, Maggi, Gerber, and Nesquik, faced significant financial headwinds in the period leading up to Freixe’s dismissal. The company’s share price experienced a substantial decline of nearly a quarter in the previous year, raising concerns among Swiss investors, particularly pension funds heavily invested in the company. This share price drop reflected broader market anxieties about the impact of sluggish consumer spending, especially in key markets like China, coupled with rising input costs for commodities like cocoa and coffee. The company’s first-half profits for 2025 also showed a marked decline, further highlighting the challenges facing the new CEO.
Paragraph 5: The Appointment of Philipp Navratil
In a swift response to Freixe’s departure, Nestlé’s board appointed Philipp Navratil as the new chief executive. Navratil, a seasoned executive within the company, had previously served as the CEO of Nespresso and joined the company’s board in January 2025. His extensive experience within Nestlé, including roles in Central America and leadership of the coffee and beverage business in Mexico, provided him with a deep understanding of the company’s operations and strategic priorities. The board expressed confidence in Navratil’s ability to navigate the company through its current challenges and execute its growth plans, emphasizing continuity in strategic direction and a focus on performance.
Paragraph 6: Navratil’s Vision and the Path Forward
Navratil embraced the existing strategic direction of Nestlé and pledged to accelerate the company’s value creation plan. His prior experience in leading global strategy and innovation for Nescafe and Starbucks, combined with his more recent role as Nespresso CEO, positioned him well to address the evolving consumer landscape and drive growth. He committed to intensifying efforts to improve Nestlé’s performance while maintaining the company’s core values and ethical standards. His appointment signaled a commitment to stability and a focus on execution as Nestlé sought to regain its momentum in a challenging market environment. The minor uptick in Nestlé’s share price following the announcement suggested a degree of investor confidence in Navratil’s leadership and the company’s ability to navigate the challenges ahead.
