Reuters, Zurich, September 1: Exactly one year after taking over, the Swiss food giant Nestle (NESN.S) announced on Monday that its CEO, Laurent Freixe, had been unexpectedly fired for failing to declare a sexual relationship with a subordinate.
With immediate effect, the company that makes everything from KitKat to Nesquik announced that it has replaced Freixe with seasoned insider Philipp Navratil, who had led the Nespresso coffee division.
Given the challenging consumer climate and the disruptive U.S. trade tariffs, Nestle faces more volatility as a result of the shock departure.
Freixe’s retirement, according to Nestle, comes after an examination into an undeclared intimate involvement with a direct subordinate that violated the company’s code of business conduct was conducted under the supervision of Chairman Paul Bulcke and Lead Independent Director Pablo Isla.
Bulcke stated, “This was a necessary decision,” in a statement. “Nestle’s governance and values form a solid basis for our business. Laurent’s years of devotion are much appreciated.
In June, the company declared that Bulcke, its longtime chairman, would step down the following year.
Concerns over a potential relationship between Freixe and a direct report initially surfaced in the spring via an internal corporate hotline, a business spokesperson told Reuters. According to this individual, the board of directors launched an investigation into the issue right after, but it came up empty.
With the assistance of an outside firm and under the supervision of Bulcke and Isla, the corporation conducted a second investigation as the worries continued, and the results verified the relationship. The spokesman noted that Freixe had first denied the relationship to the board.
Nestle informed Reuters that the fired CEO will not be given an exit payment.
