Robert McDonald is set to take over from A.G. Lafley as the new CEO of Procter & Gamble, according to a report in the Monday edition of The Wall Street Journal.
The company is due to make an official announcement following a board meeting today, but has so far refused to make any comment about the newspaper report.
McDonald currently holds the position of COO at the company, where he has spent the last 29 years. He was appointed an officer in 2000, and has served as vice president of global operations as well as holding several key posts in the Asia Pacific region.
Appointment comes earlier than expected
It has been known for some time that Lafley, who has served as CEO for nine years and has clocked up 32 years at P&G, is due to step down some time this year. But, despite there being no surprise over the rumored decision, an appointment was not expected this early.
Industry experts had clocked McDonald as an obvious candidate to succeed Lafley because of his tough stance on financial matters and the fact that he has held such a diverse range of top jobs in the company.
Likewise, he is also credited as being a ‘co-architect’, working in unison with Lafley towards the company’s successful expansion and increased profitability.
Arnold's decision to retire made competition easier
The race for the position became less competitive in March of this year, when Susan Arnold, head of the company’s global business units, made a surprise decision to announce her retirement.
Investors will be keeping a close eye on the decision, hoping that the new CEO can help guide the company out of the tough times it has been experiencing since the advent of the economic downturn last year.
Although Lafley has been credited as a highly competent CEO, the company’s last two quarterly results have been hit hard by tough retail conditions in the North American market and the strength of the US dollar.
Recent results buckle under economic pressure
For its most recent quarter, ending 31 March, sales dropped to $18.42bn, from $18.9bn a year earlier, although the company pointed out that organic sales were up one percent, reflecting a six percent positive impact from pricing and mix, helping to offset the 5 percent fall in sales volumes.
P&G expects sales growth to hover around zero in the coming fiscal year as its prediction is in the range of up 1 percent to down 2 percent.
The company anticipates organic sales growth of 1 to 3 percent driven mainly by market share growth.