17 hours ago | By WGSN Insider
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Sep 02, 2014
Italian luxury eyewear giant Luxottica Group said Monday Andrea Guerra has stepped down as chief executive after almost 10 years. The move comes after a major board reshuffle that will now see co-chief executives appointed while company founder Leonardo Del Vecchio, who owns 61%of the company, will return to become chairman. Both CEOs will have distinct responsibilities heading two separate units, markets and corporate, while an operations role, will be headed by current Luxottica executive Massimo Vian.
Current CFO Enrico Cavatorta takes up the role of corporate chief executive and will oversee the markets role on an interim basis until an appointment is made. A new chief financial officer will be selected from within the company’s current executive team.
The three areas will fall under the supervision of 79-year-old Del Vecchio who will head an executive committee made up of the co-CEOs “which will help the executives maintain a unitary strategy”, Luxottica explained.
“We’re entering a third phase [of the history] of the company,” Cavatorta said Monday. He added that the increasing complexity of the business had made a new organisational model “necessary”.
According to a person familiar with the matter telling Dow Jones Newswires, the new structure had been proposed and decided upon by Del Vecchio few months ago, as he wanted to return to a strong operational role.
However, tension and disagreements with Guerra have surfaced over the past few months, including a proposal for a change in the executive structure.
Within the new structure, Del Vecchio will be “much more present” compared with past years, particularly in the transitional phase, said Cavatorta.
But he also said Del Vecchio won’t manage day-to-day operations: “He will have the role of a guide and strategic vision,” he said.
Cavatorta also said that the company’s strategy is unchanged, and it will continue to grow through acquisitions and by broadening its role in emerging markets. Yet the company will have a renewed focus on return on investment, he added.
“It’s not going to be a dramatic change in strategy but if in the past we have tolerated to maintain low profitability business divisions… we will now be more severe with ourselves,” he said, adding that this could refer to either licenses or proprietary brands.
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