According to a Bloomberg News report, the relationship was brought to the notice of Nestle hierarchy through the company’s whistleblower program.
Nestlé garnered retail attention late on Monday after the company fired its CEO, Laurent Freixe, over an undisclosed romantic relationship with an employee.
The Swiss food products giant also named Philipp Navratil, the head of its Nespresso coffee brand, as its new chief executive with immediate effect.
The KitKat maker stated that Frexie’s departure followed the company’s investigation into an “undisclosed romantic relationship with a direct subordinate which breached Nestlé’s Code of Business Conduct.” Chairman Paul Bulcke and Lead Independent Director Pablo Isla oversaw the investigation with the support of independent outside counsel.
“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,” Bulcke said.
According to a Bloomberg News report, citing a person familiar with the matter, the relationship was brought to the notice of Nestle hierarchy through the company’s whistleblower program called “speak up.”
The report further states that the allegations couldn’t be substantiated through an initial probe, and further concerns were raised through the internal system afterward, leading to the launch of the investigation with external counsel. Freixe will not reportedly receive an exit package.
Retail sentiment on Stocktwits about Nestlé was in the ‘neutral’ territory at the time of writing.
Over the past few years, there have been several departures over undisclosed workplace relationships. BP let go of CEO Bernard Looney in 2023 for not properly revealing relationships with colleagues, while Kohl’s CEO Ashley Buchanan was fired earlier this year for directing millions to a vendor with whom she had a romantic relationship.
“Will they ever learn?” one user posted, noting the announcement.
Another wondered if they should sell the stock and re-enter at the $80 level.
Freixe’s abrupt departure continues an upheaval among Nestlé’s top brass. The now-departed CEO had only replaced former Chief Mark Schneider the previous year, following a weak share performance in recent years. Bulcke is also stepping down next year, to be replaced by Isla.
However, the executive changes have done little to convince investors. Nestle stock has fallen nearly 17% over the past year, compared with a 5% fall in rival Unilever’s share prices.
Nestlé shareholders will keenly watch whether Navratil, who has spent over two decades in the company, can steady the ship amid continued uncertainty in the global economy.
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