The boss of the Dettol disinfectant maker Reckitt Benckiser has abruptly resigned in order to take a new job in the US, surprising investors after a relatively brief three-year stint at the top of the FTSE 100 company.
Laxman Narasimhan will step down as chief executive on 30 September, despite being partway through a turnaround plan he launched after joining in September 2019.
Shares in the Slough-based company, whose brands also include Durex condoms, Calgon detergent and Nurofen painkillers, fell by 4.5% on Thursday morning. It was valued at about £48bn before the announcement.
Narasimhan said: “I have been offered an opportunity to return to the United States and although it is difficult to leave, it is the right decision for me and my family.”
Narasimhan was one of the best paid chief executives in the FTSE 100. He received total pay of £6m in 2021 and £8.4m in 2020, when the company benefited from increased sales of disinfectants from germ-conscious shoppers during the coronavirus pandemic. Part of his pay had included tax advice to help with his relocation from the US.
The company’s senior independent director, the former British American Tobacco boss Nicandro Durante, will step in as interim chief executive while the company scrambles to find a long-term replacement.
Narasimhan’s departure comes as consumer companies brace for an expected recession in many leading economies, including the UK, with households’ spending power diminished by soaring energy prices. Reckitt has protected its profits in recent months by increasing prices by more than 10%.
There have been 17 changes announced in the top job for FTSE 100 firms in 2022 so far, according to research by AJ Bell, an investment platform.
Maryum Ali, an analyst at the debt rating agency CreditSights, said the announcement was “undoubtedly a surprise”, especially as Reckitt is in the middle of a “major overhaul”.
“Reckitt Benckiser has made good progress with the strategic plan so far, albeit undeniably benefiting from a pandemic boost,” she wrote in a note to clients. However, she warned the change in leadership raised questions over whether it would stick to the same strategy in the longer term.
The company said it was a “well-invested, resilient business with a clear strategy and purpose” and would stick to the strategy set by Narasimhan.
Durante said the “transformation agenda” led by Narasimhan and group executives was “exciting” and was “delivering results”, adding: “I look forward to continuing the momentum.”
Chris Sinclair, Reckitt’s chair, said Narasimhan’s departure was caused by his desire to live in the US and thanked him for his work.