PepsiCo shuffles its top order

Indra Nooyi

Indra Nooyi  


PepsiCo announced management changes on Monday that laid out a potential line of succession to its Chief Executive Indra K. Nooyi, a move also aimed at addressing investor concerns over its lagging stock price.

John Compton, who has been running PepsiCo's food divisions, including Frito-Lay and Quaker, was named President, a newly created position with responsibility for global categories such as beverages and snacks as well as operating functions like procurement, marketing and corporate strategy.

Taking Mr. Compton's place as Chief Executive of the food division is Brian C. Cornell, a PepsiCo veteran who most recently headed Sam's Clubs for Wal-Mart Stores Inc.

“Mr. John and Mr. Brian are superb executives and will both contribute enormously in their new roles to ensure that we compete effectively and efficiently in the global marketplace,'' Mr. Nooyi said in a statement.

PepsiCo has come under fire of late as an ambitious effort to sell healthier products has reduced returns on capital and failed to generate higher profits.

The stock has stubbornly remained at more or less the same price it was when Ms. Nooyi took the helm in 2006, and investors have increased pressure on the board to do something to improve the company's financial performance.

At a snack foods conference last month, analysts made much of the fact that Mr. Compton did much of the talking while Ms. Nooyi, normally a show stealer, sat quietly on the stage.

Rumours also swirled around that meeting that PepsiCo was trying to hire Mr. Cornell, who also was being courted by Avon.

Neither of the changes announced on Monday appeared to address one of the company's largest headaches, namely, declining sales of its signature brand, Pepsi. In September, PepsiCo assigned Albert P. Carey, a 30-year company veteran, to lead its stumbling U.S. beverage business.

Ms. Nooyi has been mentioned as a possible candidate to head the World Bank.

In December, PepsiCo lost the only executive that many believed had the management experience to take Nooyi's place, when Eric J. Foss, who had been chairman and chief executive of the bottling operations before the company bought it, unexpectedly retired.

Executives like Zein Abdalla, chief of PepsiCo Europe, and Saad Abdul-Latif, head of its Asia, Middle East and Africa businesses, are still regarded as contenders for Ms. Nooyi's job in spite of Monday's announcement, and they, like Mr. Compton, will report directly to her.

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Printable version | Dec 12, 2019 2:20:45 PM |

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