Unilever CEO retires after headquarters row, replaced by
insider Jope
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[November 29, 2018]
By Sarah Young
LONDON (Reuters) - Unilever's <ULVR.L> Chief Executive Paul Polman will
retire in January after 10 years in the job, leaving insider Alan Jope
to step into his shoes after the group's failed attempt to shift its
headquarters.
A UK investor revolt forced Polman and the Unilever board to scrap a
plan in October to move the headquarters of the dual-listed company,
which makes Dove soap and Ben & Jerry's ice cream, to the Netherlands.
Company veteran Jope, 54, is the boss of the beauty and personal care
division which is Unilever's <UNc.AS> largest, accounting for almost
half of group annual profits. The Scotsman also previously led the
company's business in China and has long been seen as a possible
successor to Polman.
"Our global footprint includes strong positions in many important
markets for the future and our focus will remain on serving our
consumers, and our other multiple stakeholders, to deliver long‐term
growth and value creation," Jope said.
At the helm since January 2009, Polman, 62, generated big returns for
shareholders totalling 290 percent over the period, expanded its
presence in emerging markets, and in 2017 fended off a $143 billion
takeover approach by Kraft-Heinz <KHC.O>.
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That failed bid, however, helped prompt Dutchman Polman to seek to
simplify Unilever's Anglo-Dutch structure by shifting its headquarters
to Rotterdam. That provoked an angry reaction from UK-based shareholders
as Unilever would have left the UK FTSE 100 share index, forcing some to
sell.
Unilever's board, led by Marijn Dekkers, ditched the HQ move plan on
Oct. 5 after it became clear that it could fall short of the investor
approval needed.
Dekkers denied the row had accelerated Polman's departure.
"The appointment of Alan Jope as the successor of Paul has nothing to do
with the simplification process," he told reporters on Thursday.
Polman's decision to retire was not unexpected and the board had started
a process a year ago to consider appropriate replacements, Dekkers
added.
"That's why we were able to appoint Alan immediately," he said.
MARMITE
Polman's reputation as a champion of issues like sustainability and the
company's social impact wasn't always appreciated. Bernstein analyst
Andrew Wood said some investors were irked by what they considered a
"preachy" style but added that Polman had a strong record over the past
decade.
"Just like one of Unilever's highest profile products, Marmite, Polman
engenders strongly differing opinions from investors," Wood said.
"We consider that Polman has been an exceptionally good CEO of
Unilever," Wood added.
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![](../images/112918pics/busine53.jpg)
Paul Polman, chief executive officer of Unilever Plc, attends the
MEDEF union summer forum on the campus of the HEC School of
Management in Jouy-en-Josas, near Paris, France, August 28, 2018.
REUTERS/Benoit Tessier
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Dekkers said that Jope's appointment "stands for continuity", reassuring
investors that the company was on track to meet guidance set by Polman, that
includes a target for underlying operating margin of 20 percent by 2020.
NATIONAL BALANCE
The appointment of Jope rebalances the Anglo-Dutch leadership of the company in
favour of the British-side. While Dekkers is Dutch, Unilever's Chief Financial
Officer Graeme Pitkethly is also British.
Dekkers said that nationality played no role in how Unilever made appointment
decisions.
Pitkethly, who was involved in the media campaign defending the plan to move the
HQ, had also been rumoured as a possible replacement for Polman.
Jope joined Unilever as a graduate trainee in 1985. He will be paid a fixed
salary of 1.45 million euros ($1.65 million) plus a target annual bonus of 150
percent of fixed pay in his new role as CEO.
He was named in the job after what the chairman described as "a rigorous and
wide-ranging selection process", which analysts Bryan, Garnier & Co said had
been lead by recruitment firm Egon Zehnder.
Investors will not have to wait long for a chance to quiz the company on its
future - Unilever is due to hold an investor day in Mumbai, India on Dec. 4 and
5.
On the new CEO's agenda will be Unilever's bid for GlaxoSmithKline's <GSK.L>
Indian Horlicks nutrition business, where it is competing against consumer giant
Nestle <NESN.S>, as well as handling any fallout from a possible no-deal Brexit
as Britain is due to leave the EU in March 2019.
Polman, who was paid a fixed annual salary of 1.4 million pounds but with
bonuses took home a total package of about 10 million pounds, will stay on for
six months to support Jope's transition into the role, Unilever added in its
statement.
Shares in Unilever traded down 0.5 percent in midday trade. The stock has risen
170 percent since Polman took the top job, outperforming Britain's bluechip
index <.FTSE> which is up about 75 percent.
(Additional reporting by Martinne Geller; Editing by Keith Weir and Elaine
Hardcastle)
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