Onome Amuge
Nestlé, the world’s largest consumer goods company, has moved swiftly to install Philipp Navratil as its new chief executive after firing Laurent Freixe on Monday, thrusting the Nespresso chief into the role of reviving the Swiss giant’s flagging share price and sluggish sales.
Freixe, who had led the group since last year, was dismissed for failing to disclose a romantic relationship with a subordinate, a breach of conduct that echoes similar governance controversies at BP, McDonald’s and Kohl’s in recent years. His sudden exit marks the second time in just over a year that Nestlé has had to change leaders, raising concerns about stability at the top.
Navratil, a 49-year-old Swiss and Austrian national, is a company veteran who joined in 2001 and built much of his career in Latin America before being appointed head of Nespresso in 2023. He only joined Nestlé’s executive board in January, making his elevation to the chief executive’s office unexpectedly rapid.
The new CEO inherits a business weighed down by slowing global demand and battered by macroeconomic headwinds. In its first-half results in July, Nestlé reported weaker-than-expected sales growth, blaming U.S. trade tariffs and the strong Swiss franc for eroding competitiveness.
Consumers, squeezed by inflation and higher interest rates, have increasingly traded down to cheaper alternatives, hitting premium brands such as Nespresso. Analysts warn that Navratil must now prove he can revive growth in categories where pricing power has waned.
Investor patience is wearing thin. Nestlé shares have lost nearly a third of their value in the past five years, underperforming rivals such as Unilever and Danone. The stock slipped another 0.8 per cent on Tuesday morning following the leadership announcement.
“There might now be disruption to the company’s turnaround plan as new boss Philipp Navratil gets up to speed. The uncertainty is whether he will continue on the same path as his predecessor or chart a new course,” said Russ Mould, investment director at AJ Bell.
Beyond financial performance, Nestlé faces reputational risks. Freixe’s dismissal is considered a reminder of the scrutiny over executive behaviour at global blue-chip companies. The departure of Mark Schneider as CEO last year, coupled with the planned exit of Nestlé’s long-serving chairman, has left the company facing leadership churn at a time when stability is critical.
“Bringing calm waters back to Nestlé must be a top priority. The company cannot afford further negative headlines while trying to execute a turnaround,” said Ingo Speich of investor Deka.
Insider debate
The choice of another insider has divided opinion. Bernstein analysts noted that the rapid timescale of his appointment presumably implies that no extensive external search was undertaken, and indicated investors may question whether Nestlé is overly reliant on internal continuity.
By contrast, Zürcher Kantonalbank analysts described Navratil’s appointment as a Swiss compromise, balancing the need for change with the familiarity of an insider.
Jean-Philippe Bertschy at Vontobel called Navratil “straightforward, ambitious, and relentlessly focused on results,” adding that the group was banking on a next-generation leader to steer it out of crisis.
Analysts however agree that Navratil’s immediate priorities will be to stabilise investor sentiment, reinvigorate growth in premium categories, and reassure stakeholders that Nestlé’s governance lapses are firmly behind it. He must also decide whether to stick with Freixe’s turnaround blueprint or chart a fresh strategy in an increasingly competitive consumer goods market.
For now, the market remains cautious. The new chief inherits a company with vast global reach, iconic brands and deep financial resources , but also one weighed down by lost momentum and investor scepticism. According to analysts, how Navratil addresses these cross-currents will determine whether Nestlé can rediscover its status as a European market leader, or remain trapped in a cycle of weak sales and governance controversies.
