Heineken’s executive committee reshuffle
What can it mean that Alexis Nasard, formerly Heineken’s Chief Commercial Officer, has been appointed President Western Europe & Chief Marketing Officer as of April this year?
For Mr Nasard to become President Western Europe, Didier Debrosse had to vacate this post. At the end of March Mr Debrosse was sent to Latin America to take on the challenge of Managing Director Heineken Brazil. Whether Mr Nasard volunteered for the new job or whether the portfolio was pushed his way in the recent committee reshuffle announced in February this year, we cannot say.
What is beyond doubt is that Heineken’s unit Western Europe remains the brewer’s main building site. You don’t need to be a clairvoyant to predict that beer volumes in Western Europe will continue to decline and that competition among brewers will grow even fiercer. Among the top 4 global brewers, only Heineken and Carlsberg still significantly depend on Western Europe for their profits. While AB–InBev make 7 percent (EBITDA) and SABMiller 17 percent (EBITA) of their profits in these markets, Heineken realise 32 percent (EBIT) and Carlsberg 46 percent (EBIT) there.
In actual fact, Western Europe has long been Heineken’s “engine room”, a much–liked metaphor among brewers, providing the profits needed to fund Heineken’s acquisitions.
Mr Nasard’s predecessor, Mr Debrosse, set the bars high for Mr Nasard. According to an internal memo, since 2005, Mr Debrosse has overseen an increase in Heineken’s EBIT (beia) of EUR 360 million, which translates into an average 8 percent growth per annum all the while a global financial crisis raged. He also managed to implement major cost saving programmes, with regional fixed costs reduced by EUR 421 million.
All eyes are now set on Mr Nasard, who not only will be Heineken’s bossman in Western Europe but also its global Chief Marketing Officer. Mr Nasard’s previous role of Chief Commercial Officer has ceased to exist. The marketing and sales elements of the role are now split between Mr Nasard (Marketing) and Jan Derck van Karnebeek (Sales). Mr van Karnebeek, who was Regional President Central and Eastern Europe, bears dual responsibilities of President Central and Eastern Europe & Chief Sales Officer.
What Heineken’s CEO Jean–François van Boxmeer has seemingly done (with the consent of the Heineken family, presumably) by reshuffling the executive committee is to follow the maxim of “divide et impera” (“divide and rule”). In plain English: you maintain your power by breaking up larger concentrations of power into chunks that individually have less power. As said, this is how one could interpret (!) the re–alignment of responsibilities in Heineken’s executive committee.
However, this is not to imply (!) that Mr van Boxmeer has faced a boardroom revolt or that he is about to lose the majority owners’ support. Far from it.
Because he has done so well in taking Heineken forward through acquisitions in recent years, most notably FEMSA Cerveza in Mexico and APB in Asia, his remuneration was more than doubled in 2012. Heineken awarded him one–time share bonuses worth EUR 4 million (USD 5.2 million), which made his total remuneration rise to EUR 8.17 million in 2012, Bloomberg calculations show, from the previous year’s EUR 3.4 million, according to the company’s annual report.
Also, Mr van Boxmeer’s base pay will increase to EUR 1.15 million for 2013 from EUR 1.05 million in 2012. This is supposed to bring his salary more in line with industry peers. In 2011, the Belgian magazine Trends reported, Mr Brito (AB–InBev) had a base salary of EUR 1.6 million, Mr Buhl Rasmussen (Carlsberg) of EUR 1.4 million, and Mr Mackay (SABMiller) of EUR 1.3 million. Mind you that’s without bonuses, other annual incentives paid, and any long–term incentive awards, which are often significantly higher than the base salary.
