Nestle fires CEO Laurent Freixe for concealing a romantic relationship with a subordinate. Philipp Navratil replaces him as Nestle faces leadership crisis, share price slump, and slowing sales amid global economic challenges. Other consumer companies like Suntory and Kraft Heinz also see leadership changes and activist investor pressure. Freixe’s dismissal follows an investigation into the relationship that breached Nestle’s code of conduct.

Concerns about the relationship were raised by staff via Nestle’s internal reporting channel Speak Up, leading to an investigation overseen by former CEO Paul Bulcke and Pablo Isla. Freixe, who spent 39 years with Nestle, will receive no exit package following his departure. Nestle’s code of conduct prohibits direct reporting relationships between family members, partners, and close associates.

Nestle’s shares have lost almost a third of their value over the past five years, underperforming European peers. Freixe’s appointment failed to halt the slide, disappointing investors. The new CEO, Navratil, is tasked with slimming down the company, cutting costs, reducing headcount, and boosting organic growth. Nestle’s underperforming vitamins business is under review for potential divestment.

Investment director Russ Mould anticipates a period of uncertainty for Nestle as Navratil takes over and potentially resets the turnaround plan. The company faces challenges in restoring investor confidence and improving performance amid global economic headwinds. Navratil’s appointment represents an opportunity for a more ambitious overhaul of Nestle’s business model and growth strategy.

Read more at Yahoo Finance: Nestle plunged into crisis as CEO fired for hiding romance with staffer