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Diageo boss Menezes shakes up team at spirits giant

Ivan Menezes will be keen to stamp his signature on the drinks giant. Picture: Contributed

Ivan Menezes will be keen to stamp his signature on the drinks giant. Picture: Contributed

  • by MARTIN FLANAGAN
 

DIAGEO chief executive Ivan Menezes moved to stamp his authority on the spirits giant today by unveiling a shake-up of his top management team..

Menezes, who took over from long-standing chief executive Paul Walsh last July, radically simplified the reporting structure of the organisation, which is also Scotland’s biggest whisky company.

The key supply and procurement function will in future report directly to the company’s chief financial officer, Deirdre Mahlan.

David Gosnell, president for global supply and procurement, and responsible for much of the company’s whisky expansion programme, will retire, and will be succeeded by international supply centre director David Cutter.

Amid emerging market volatility that has hit all the big spirits industry players in the past year, former Asia Pacific president Gilbert Ghostine will become president for India and Greater China.

Ghostine will also take on the newly created role of chief corporate development officer. Nick Blazquez is appointed president, Diageo Africa, Eurasia and Pacific, adding responsibility for Asia and Australia to his existing responsibility for Africa, Turkey, Russia and eastern Europe.

Menezes said the changes to the company’s executive committee would take effect from 1 July, with analysts seeing them as paving the way for a shake-up of the regional back office functions.

That is part of the chief executive’s expressed strategy to slash £200 million off the costbase of the group, much of it to be ploughed back into the global marketing and advertising of its products.

These range from Johnnie Walker and J&B whiskies to Smirnoff vodka and Guinness. On the specific focus on India and China, Menezes said today: “Over the last few years the scale and shape of our business in Asia Pacific has been transformed, primarily by the acquisitions we have made in India and Greater China.

“These markets are key growth engines for Diageo, and Gilbert Ghostine will now focus on the development of our position in India and China, a position which he orchestrated as he led the expansion of our business in Asia Pacific.”

Phil Carroll, drinks analyst at broker Shore Capital, commnented: “There’s obviously an element here of the chief executive stamping his mark on the structural reporting of the business.

“It does not change anything in the short-term.

“The City will have greater interest when Diageo puts some flesh on the bones of its costcutting plans, which it has not done an awful lot of so far.”

Another analyst said Diageo-watchers would be hoping for more detail on those plans, expected to involve a swathe of redundancies, at the company’s third-quarter trading statement in mid-April.

• Newly-filed accounts for Gleneagles Hotel, which is owned by Diageo, show that turnover at the Perthshire resort rose by more than £2m to £38.8m in the year to 30 June. Pre-tax profits came in at £262,000, down from £591,000.

 

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