Danone's former chief executive Emmanuel Faber has hit out at the manner in which activist investors have influenced the board of directors at the food group, saying that certain members of the board played an "unhealthy game" that led to erratic decisions being made.
Faber was speaking during a hearing of the Economic Affairs Committee of the National Assembly, several newspapers in France reported, with the former CEO, who was ousted from his position in March, suggesting that the company's board was "compromised" by activist investors.
Faber also described as "false" suggestions that he was ousted from Danone due to the insufficient performance of the business, particularly in terms of its profitability.
In the latter months of his tenure as chief executive, Faber had come under increased pressure from shareholders, including investment fund Artisan Partners and activist investor Bluebell Capital. Artisan Partners is the group's third biggest shareholder.
"The activists came because of the dysfunction of the board of directors," the AFP news agency quoted Faber as saying. "They are as much the consequence of it as they are the cause."
On the increasingly important role that said activists played in influencing management decisions, Faber added, "Certain activists inside the board used these shareholder activists for purposes that were personal to them and which led to the result which we only see the beginning of today, with my departure."
Noting that "at least some" of the board members played an "extremely unhealthy game" with these activist investors, Faber called for the "very urgent" reform of the company's board.
“When you start a game like this, it's hard to stop it," he added,
New Chief Executive
In May, Danone announced the appointment of outgoing Barry Callebaut CEO Antoine de Saint-Affrique as its new chief executive, effective 15 September.
On his appointment, chairman Gilles Schnepp said that the new CEO "will have all the room and resources a CEO can have to best assess and direct Danone's strategy for the future".