Nestlé investors has been pitched back into uncertainty after the Swiss food giant abruptly sacked Chief Executive Laurent Freixe over an affair with a subordinate, marking the company’s second leadership shake-up in just over a year.
Freixe was replaced by Philipp Navratil, a rising executive within the company, in a move Nestlé said followed an internal investigation into a breach of its code of business conduct. “The dismissal of Freixe follows an investigation into an undisclosed romantic relationship with a direct subordinate which breached Nestlé’s code of business conduct,” the company announced late on Monday.
The sudden removal deepens the turbulence at the world’s largest food group, which has been battling to halt a prolonged slide in its share price. Freixe’s departure comes a year after the ouster of his predecessor Mark Schneider and only months after long-serving chairman Paul Bulcke said he would step down in 2026.
Nestlé’s shares, once a cornerstone of the Swiss stock exchange, have shed nearly a third of their value in the past five years. Investors had hoped Freixe could steady the ship, but during his tenure the stock fell a further 17%. In July, the company announced a review of its underperforming vitamins business after first-half sales volumes missed expectations.
Market watchers said Freixe had failed to win over investors. “The market did not particularly like Freixe, and the restructuring goals were also put on the back burner,” said Maurizio Porfiri, chief investment officer at trading firm Maverix. “Another fresh start is needed, and it is time for more stability to return to the management at this global corporation,” he said.
The dismissal dominated Swiss newspaper headlines on Tuesday. The Neue Zürcher Zeitung wrote that Nestlé had lost its “legendary stability” where CEOs traditionally stayed for years before eventually becoming chairmen.
Analysts warned that Navratil’s appointment left big questions unanswered. “The latest change is likely to leave questions unanswered about Nestlé’s mid-term direction and keep a lid on the equity story until we hear more about Mr. Navratil’s plan,” JPMorgan analysts said in a research note. They added that the reshuffle was unlikely to calm investors: “The news of Freixe’s ouster was unlikely to reassure investors because it was the second time in a year that the company had appointed a new boss without carrying out a thorough search for a replacement.”
The note also suggested Navratil may struggle to chart his own course in the short term. Analysts cautioned he appeared “boxed in” by Freixe’s turnaround strategy at a time when markets remained unconvinced about Nestlé’s performance.
Jon Cox, an analyst at Kepler Cheuvreux, said the latest upheaval was highly unusual for a company long known for its steady leadership transitions. “This is not the Nestlé way to do things, to have two CEO replacements in just over a year,” Cox said. “Hopefully this will get them back on the straight and narrow.”
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