Unilever ousts chief Schumacher and promotes finance head Fernandez

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Unilever has ousted chief executive Hein Schumacher after less than two years, replacing him with chief financial officer Fernando Fernandez as the consumer goods group steps up efforts to revive its fortunes.

Schumacher, who has led the group since July 2023, will step down by “mutual agreement” on March 1, Unilever said on Tuesday.

The abrupt change comes as Unilever faces growing pressure from investors, including US activist Nelson Peltz, to improve its lacklustre performance. It also follows the launch of a major restructuring at the maker of Magnum and Ben & Jerry’s, kicked off by Schumacher, which includes plans to hive off its ice-cream business and slash costs.

The decision to remove Schumacher was taken at a board meeting on Monday, according to a person familiar with the matter, after the group’s directors concluded that Fernandez was “better suited” to execute the turnaround plan.

Schumacher was appointed in 2023 by the previous chair, Nils Andersen, and is considered to have been Peltz’s preferred candidate for the role. Andersen was replaced months later by British businessman Ian Meakins, former chair of caterer Compass Group and electrical equipment distributor Rexel, who analysts say has a no-nonsense reputation.

Fernandez, an Argentine who has been at Unilever for almost 40 years, previously led the group’s beauty business. He took over as chief financial officer in early 2024. The executive is known for being decisive and results focused and is popular with investors, according to analysts and people familiar with the company.

Analysts reacted with shock to the news. Unilever’s share price has been on a strong run since Schumacher joined as chief executive, rising 11 per cent and outperforming its peers. 

Since joining the company, the Dutch executive has launched a wide-ranging turnaround plan which included cutting 7,500 jobs and spinning out the company’s ice-cream division. The restructure has caused significant upheaval inside the company, and prompted the departure of multiple senior executives.

At the group’s full-year results earlier this month, Unilever forecast muted growth at the start of the year and worse than expected earnings, prompting concerns that the turnaround had stalled. 

“One set of slightly wayward results certainly would not warrant his defenestration in our opinion,” said James Edwardes Jones, analyst at RBC Capital Markets, adding that Schumacher was “very highly regarded” and that his departure was a “bolt from the blue”.

David Hayes, analyst at Jefferies, said the move was a surprise but that investors would be happy with the new appointment: “They like [Fernandez’s] direct approach, but some may also see his style as somewhat maverick.”

“This dynamic of fiery, charismatic CFO vs understated CEO in Hein was always somewhat unusual,” said Callum Elliott, analyst at Bernstein. “In this light, Fernando’s promotion to CEO is not a surprise. It is the timing and manner of the change which takes us off-guard.”

Unilever said on Tuesday that Schumacher would be eligible for a payment in lieu of the remainder of his notice and would be treated as a “good leaver”.

Unilever’s chair Ian Meakins said: “The board has been impressed with Fernando’s decisive and results-oriented approach and his ability to drive change at speed.”

He added: “I would like to thank Hein for resetting Unilever’s strategy, for the focus and discipline he has brought to the company and for the solid financial progress delivered during 2024.”

Schumacher said in November that he would sell smaller and underperforming food brands, amounting to about £1bn in revenue, which could include anything from its plant-based food brand Vegetarian Butcher, to Pot Noodle, Marmite and Colman’s.

Shares in Unilever slipped 2 per cent in early trading on Tuesday as investors digested the news.

Schumacher will leave the group on May 31.