In a year that seems determined to shake the foundations of corporate leadership, Nestlé has made a stunning move, firing CEO Laurent Freixe just over a year into his tenure. The reason? Concealing a romantic relationship with a subordinate, a clear breach of the company's code of conduct. The dismissal, which came after an investigation sparked by an anonymous tip, has thrown the Swiss food giant into a fresh leadership crisis, compounding a share price slump and slowing sales.
Freixe's removal adds to a growing list of high-profile chief executives who have been forced to resign over undisclosed relationships with colleagues, including former BP CEO Bernard Looney and McDonald's CEO Steve Easterbrook. The scandal at Nestlé began with a tip from an internal reporting channel known as Speak Up. Although an initial investigation was inconclusive, persistent concerns from staff prompted the company to order a more thorough inquiry. The report, completed in recent days, led to a board meeting and Freixe's immediate dismissal.
The firing of a CEO for a personal relationship, while shocking to some, is a powerful statement about the evolving nature of corporate governance. As corporate governance expert Peter V. Kunz from the University of Bern stated, such behavior is "simply stupid and incomprehensible in this day and age." Companies, including Nestlé, have clear internal codes of conduct that require relationships between senior executives and subordinates to be disclosed to avoid potential conflicts of interest. Freixe's failure to do so, despite initially denying the relationship to the board, led to his unceremonious departure. The company has made it clear that he will receive no exit package.
Freixe's sudden departure is a major setback for Nestlé, which is already struggling with the impact of U.S. tariffs, a darkening global economic outlook, and dwindling investor confidence. The company's troubles are part of a wider trend in 2025, which has seen Japan's Suntory and Kraft Heinz also part ways with their CEOs. Ingo Speich, a top Nestlé investor, noted that the loss of two CEOs and a chairman in a year is "of historic proportions for Nestlé."
Freixe's replacement is Philipp Navratil, the Nespresso chief and a rising star within the company. He faces an uphill battle to fix the business model, bring volumes back, and regain investor confidence. The scandal surrounding Freixe's departure is a powerful reminder that in today's corporate world, transparency and adherence to ethical codes are not just a matter of policy, but a matter of trust and a key to maintaining a company's stability and public reputation.
