News

Diageo CFO steps down

03 May 2024 By James Evison

There are more changes in the top team at global drinks giant Diageo with Lavanya Chandrashekar stepping down as chief financial officer (CFO) after three years in the role.

Chandrashekar, who has been at the firm for six years, started as CFO for its North American division in 2018, before stepping up to the CFO role in July 2021.

Her role has included putting in place its £500m supply agility programme, which aims to deliver a US$2bn productivity target from 2025 to 2027 fiscal years.

The news follows disappointing results for Diageo in 2023, falling short of analysts’ predictions, even after a warning. It also follows Debra Crew taking the top job from the late Ivan Menezes last year.

Performance

The drinks giant was hard hit by a 23% fall in the Latin American and Caribbean region which accounts for 10% of its business. Overall, sales fell 1.4% to US$11.0 billion, with organic sales down 0.6%. Organic operating profit slipped 5.4%, but would have increased by 0.9% if Latin America was excluded.

In the US organic sales fell by 2% compared with the strong performance a year earlier.

New chief executive Debra Crew said in December 2023 that “North America delivered sequential improvement in line with our expectations” but emphasised “we are focused on returning to high-quality share growth as consumer behaviour continues to normalise in our largest region”.

Chandrashekar will now step down from the executive committee and board at the same time and return to the US, the company said.

Speaking about her performance she said that she was “proud” to have overseen a strong period of growth for the company and to have “embedded a culture of productivity and efficiency”.

Replacement

Nik Jhangiani will replace Chandrashekar, joining the executive committee as CFO in the autumn.

Jhangiani is currently CFO at Coca-Cola Europacific Partners (CCEP), where he has been in the role since 2016.

He has more than 30 years of finance experience across a number of roles, with 20 years within the Coca-Cola group of companies. He has also held a group financial officer role at Bharti Enterprises, a leading Indian food, retail, property and telecoms firm for three years from 2009 to 2012.

Speaking about the appointment, Crew said he was “a highly experienced CFO” with a “proven global track-record” to generate growth across multiple businesses and industries. She said his “experience and international mindset will make him a strong addition to our leadership team”.

Crew also commented on Chandrashekar’s departure saying she was “grateful” to her contribution and delivering productivity savings.

Long runway

She added: “With a strong focus on execution, we will continue to invest behind our world-leading brands to create value for shareholders and maintain our position as an industry leader in total beverage alcohol, which we strongly believe is an attractive sector with a long runway for growth.”

Javier Ferrán, who chairs the company said that he was “confident” of Jhangiani’s “record of sucess” and that it will “further strengthen our long-term track record of delivering long-term sustainable returns for our shareholders”.

Jhangiani said he was “delighted” to be joining Diageo, and it was a firm he had “long admired”.

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