Nestlé has dismissed its chief executive, Laurent Freixe, after an internal investigation found he failed to declare a romantic relationship with a subordinate. The company announced the decision on Monday, saying the breach of its code of conduct left his position untenable. Freixe, who took over the top job only last September, has been replaced with immediate effect by long-serving executive Philipp Navratil. The change comes as the world’s biggest food and drink maker faces rising costs, shifting consumer habits and questions about how it enforces its own governance standards.
Board Acts Swiftly
In a brief statement, Nestlé said the inquiry concluded Freixe had broken company rules by not disclosing the relationship. Chairman Paul Bulcke said the board’s decision was unavoidable. “This was a necessary decision. Nestlé’s values and governance are the strong foundations of our company,” he noted. The company declined to give further details, but the swift removal reflects a hardening stance among global corporations on undisclosed workplace relationships, particularly at senior level.
A Career Cut Short at the Top
Freixe’s departure draws a line under nearly four decades with the company. He joined Nestlé in 1986 and built a reputation as an effective operator, leading businesses in Europe, North America and Latin America. In 2022, he was appointed head of Zone Latin America before being elevated to group CEO in September 2024, succeeding Mark Schneider. His time in the role lasted just a year — a remarkably brief tenure for a company known for stability at the top.
Navratil Steps Into the Role
Replacing him is Philipp Navratil, another Nestlé veteran. Navratil began his career at the company in 2001 as an internal auditor before taking on posts in Central America and later moving into the coffee division. He most recently served as chief executive of Nespresso, where he helped expand the brand’s reach in premium markets. His appointment signals the board’s preference for continuity and internal experience at a moment when Nestlé is trying to steady the ship.
Testing Times for the Food Giant
The shake-up comes as Nestlé contends with mounting pressure across its business. Coffee and cocoa prices have soared, tariffs have hit margins, and shoppers have grown more cautious amid high inflation. In July, the company said it had managed to offset some of these challenges by raising prices, but analysts warn that persistent cost pressures and softer demand could weigh on future growth.
Wider Governance Questions
Governance experts say Nestlé’s handling of the affair shows how sensitive multinationals have become to potential conflicts of interest. Several global companies have faced similar scandals in recent years, often resulting in abrupt resignations. For Nestlé, the decision is also about sending a clear message: rules apply at every level, even in the corner office.
What’s Next
For investors, the sudden change raises questions about stability, but the appointment of a seasoned insider may help ease concerns. Navratil now faces the dual challenge of steering the company through volatile markets while convincing staff and shareholders that Nestlé’s leadership is firmly back on track.
