Nestle In Trouble: Affair Allegations End CEO Laurent Freixe's 40-Year Journey; New CEO To Take Over

Swiss food giant Nestle has removed its CEO Laurent Freixe after an internal probe confirmed he had an undisclosed romantic relationship with a subordinate. The company called the decision "necessary" to uphold its code of business conduct and governance standards.

Why Was Laurent Freixe Dismissed?

According to Reuters, the issue first came to light through Nestle's internal whistleblowing system. At first, nothing was found, but after more complaints, the company brought in outside experts to investigate.

The probe confirmed that Laurent Freixe had a personal relationship with a direct report, breaking company rules. After this, the Nestle board, led by Chairman Paul Bulcke and independent director Pablo Isla, decided to fire him.
Reports also said he will not get any severance pay, though Nestle has not clarified what will happen to his stock holdings worth about $3.6 million.

Who Is Laurent Freixe?

The 63-year-old Freixe was a Nestle veteran with about 40 years at the company, rising through roles in Europe and Latin America. He became CEO in September 2024, replacing Ulf Mark Schneider.

However, his short stint was challenging. Nestle faced falling profits, weak consumer demand, and higher raw material costs, which weighed on its margins.

New Nestle CEO appointed: Philipp Navratil

According to the press release shared by Nestle, Chairman Paul Bulcke stated, "I am pleased to announce Philipp Navratil as CEO. Philipp is recognised for his impressive track record of achieving results in challenging environments."

Navratil, who joined the company in 2001, previously headed the Nespresso division and has played a major role in growing brands like Nescafé and Starbucks.

His focus will be on improving efficiency, handling inflation pressures, and reviving growth in key markets like China.

Stock Market Reaction

Nestle shares on the SIX Swiss Exchange were trading at 74.80 CHF, down 0.69 CHF (0.91%) today. Over the past six months, the stock has slipped nearly 15.6%, due to concerns over weak demand, rising input costs, and now the sudden leadership change. Market sentiment is currently cautious as investors await signs of recovery in performance.