Nestle has fired its chief executive after just one year in the job because he failed to disclose a “romantic relationship” with a “direct subordinate”.
The Swiss food giant, which makes Kit Kat chocolate bars and Nespresso coffee capsules, said Laurent Freixe had been dismissed with “immediate effect” following an investigation led by Nestle’s chair and lead independent director.
The BBC understands the inquiry was triggered by a report made through the company’s whistleblowing channel.
Nestle chair Paul Bulcke said: “This was a necessary decision. Nestle’s values and governance are strong foundations of our company. I thank Laurent for his years of service at Nestle.”
The relationship was with an employee who is not on the executive board and the investigation began because it represented a conflict of interest, the BBC has learned.
As well as Mr Bulcke, independent director Pablo Isla oversaw the inquiry into Mr Freixe “with the support of independent outside counsel”.
The Financial Times has reported that concerns were raised about Mr Freixe’s relationship with an employee earlier this year and, after an internal investigation, the claims were found to be unsubstantiated.
After the complaints persisted, the newspaper reports that Nestle conducted another investigation with help from outside counsel after which the claims were upheld.
A spokesperson for Nestle said: “We acted at all times in line with best practice corporate governance.
“The external investigation was opened shortly after the initial internal investigation, and today’s decision shows that we are taking allegations and investigations seriously.”
On Wednesday, Nestle subsequently said: “Laurent Freixe denied the relationship throughout the course of both investigations.”
Mr Freixe had been with Nestle for nearly 40 years but stepped up to the global chief executive role last September, replacing Mark Schneider.
Nestle confirmed that he will not receive an exit package.
The BBC has contacted Mr Freixe for comment.
Philipp Navratil, who has been with Nestle since 2001, has been appointed as Mr Freixe’s successor.
Mr Bulcke said the company was “not changing course on strategy and we will not lose pace on performance”.
