Nestlé CEO Laurent Freixe Dismissed for Code Breach; Philipp Navratil Steps In

Nestlé has removed Laurent Freixe from his position as CEO after an investigation revealed a breach of the company's code of business conduct due to an undisclosed romantic relationship with a direct subordinate. Freixe, who had been with the company for nearly 40 years and served as CEO for just a year, faced immediate dismissal following the investigation. The inquiry was led by Nestlé's Chairman Paul Bulcke and Lead Independent Director Pablo Isla, with assistance from external counsel. Paul Bulcke remarked, "This was a necessary decision. Nestlé's values and governance are strong foundations of our company."

The investigation was initiated after a report was made through Nestlé's whistleblowing channel, highlighting the relationship that constituted a conflict of interest. Despite Freixe’s extensive tenure with Nestlé, during which he stepped into the CEO role last September succeeding Mark Schneider, he will not receive an exit package.

Philipp Navratil, who has been with Nestlé since 2001, has been appointed as the new CEO. Navratil's career trajectory within Nestlé began as an internal auditor, after which he held various commercial roles, including as country manager for Nestlé Honduras and leading the coffee and beverage business in Mexico. He was recently involved with the company's Coffee Strategic Business Unit before taking over as CEO of Nespresso in 2024, and he joined the executive board on January 1 this year.

In addition to these notable changes at Nestlé, the similar dismissal of chief executives from other companies has been observed, with executives from companies like BP and McDonald's also being ousted following revelations of undisclosed personal relationships with colleagues, although their circumstances and outcomes, such as severance packages and fines, varied.

Freixe's departure highlights the strict adherence to corporate governance and ethical conduct within major corporations, reinforcing the importance of transparency and ethical behavior in executive roles. The transition to Navratil is seen as a continuation of Nestlé's strategic goals without altering the company's current strategic direction or performance momentum. Bulcke expressed confidence in Navratil's capability to propel the company forward, emphasizing his track record of achieving results and leadership qualities.