The decision by Danone chief executive Emmanuel Faber to step down from his role as CEO, and continue to occupy the position as chairman at the food group "raises more questions than answers", an industry analyst has said.
Dean Best of Global Data was commenting as Danone, under pressure from activist investors, announced it was making a number of executive changes, in a move that had the 'unanimous support' of its board.
As well as Faber taking the role of chairman, recently-appointed director Gilles Schnepp and former CFO Cécile Cabanis have taken vice chairman positions at the food group.
Future Strategy
As Bell noted, while activist investors Artisan and Bluebell "may welcome the end of one person holding both the roles of chairman and CEO, as well as Faber relinquishing the job of chief executive, questions remain over what the changes will mean for strategy at Danone.
"Might the new CEO feel constrained by having Faber remain as chairman and, for that matter, Cabanis as vice chairman?"
In its immediate response to the move, Artisan Partners said earlier this week that Danone should appoint a new, independent chairman, adding to the pressure on Faber.
'With Mr. Faber as chairman, the incoming CEO will not have the appropriate latitude to set a new direction,' Artisan said in a note, as reported by Reuters.
Local First
Elsewhere, in its statement to announce the changes, Danone also said that it was increasing its investment in its 'local first' strategy, as it seeks to "become more agile and better serve customers," said Best.
"Artisan is not a fan of the strategy, although it could be argued a stronger focus on local markets could benefit the business," he added.
Furthermore, Jean-Michel Severino, who has been on the Danone board since 2011, has been named the company’s new lead independent director, "which could be another frustration for those wanting more significant change at the business," Best argued.
As Best noted, since the announcement was made, Danone's share price has slipped back, "indicating a lukewarm response to the company’s efforts to calm shareholder concerns. It remains to be seen whether Danone’s moves will work."
Faber has headed up Danone since 2014.
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