Peltz to Depart P&G Board, Capping Nearly Four-Year Overhaul

(Bloomberg) -- Billionaire Nelson Peltz is retiring from Procter & Gamble Co.’s board after nearly four years and several dramatic changes to help improve performance at the consumer-goods giant.

Peltz, who co-founded and runs Trian Fund Management, told P&G he won’t stand for re-election at the 2021 shareholder meeting, according to a statement Thursday. Peltz was appointed to the board in December 2017 after a high-profile and costly proxy fight that P&G said it had won based on preliminary numbers before a recount said it hadn’t. The final certified results showed Peltz fell short of winning his seat, but the parties settled, and he was appointed to the board.

Since then, the parties put their differences aside and total shareholder returns have been roughly 67% since Trian first disclosed its position in June 2017, according to data compiled by Bloomberg. Trian still owned a roughly $827 million stake in the company as of June, according to a regulatory filing.

“P&G has created tremendous value for all stakeholders since 2017,” Peltz said Thursday. “As a large shareholder of Procter & Gamble, Trian remains highly confident in P&G’s continued success given its focused strategies, disciplined execution, accountability-driven organization structure and an extremely strong management team.”

Trian argued when it took its initial position in P&G that the company suffered from a bloated structure and a lack of new brands favored by younger shoppers. While Peltz didn’t call for the replacement of Chief Executive Officer David Taylor at the time, or a breakup of the company, he did suggest reorganizing the maker of Tide laundry detergent and Pampers diapers into three largely autonomous units.

While the company didn’t quite go to those extremes, it has sustained market share, streamlined its operations from 10 business units to six, improved its earnings growth, cleared out bureaucracy and increased accountability.

Departing CEO

Taylor said last week he planned to step down as CEO as of Nov. 1, and will be succeeded by current Chief Operating Officer Jon Moeller. Taylor will remain at P&G as its executive chairman.

Taylor thanked Peltz for his service Thursday, calling the investor a “focused, collaborative member” of the board.

“Working in concert, Nelson and the board have constructively provided perspective and expertise to help me and P&G’s senior leaders navigate a challenging external environment and maintain long-term competitive advantage for the benefit of many stakeholders,” he said in a statement.

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