Procter & Gamble Co. (PG) Chief Executive Officer Bob McDonald said he’s spending more than a third of his time at the world’s largest consumer-products company on succession and leadership planning for top positions.
McDonald has been under pressure from activist investor Bill Ackman, whom people familiar with the matter have said may seek leadership changes at P&G after his Pershing Square Capital took a $1.8 billion stake in P&G in July. The CEO said today at an event in Chicago that he’s looking to promote internal candidates as the company has in the past. The succession issues are occupying about 35 percent to 40 percent of his time, McDonald said.
“The logic is that you really want to know who’s in the pipeline for almost any senior position,” Sydney Finkelstein, the Steven Roth Professor of Management at Dartmouth’s Tuck School of Business, said today in a telephone interview. “It’s common to know personally, a lot about the top 500 people in some of these companies, which is an incredible number of people.”
P&G’s share performance has trailed competitors such as Colgate-Palmolive Co. (CL) and Kimberly-Clark Corp. (KMB) since McDonald took over in July 2009. The company is trying to boost sales growth by focusing on top markets and categories and working to save $10 billion by 2016.
Ackman has sought organizational and management changes in other companies, including a successful effort to remove Canadian Pacific Railway Ltd. CEO Fred Green this year.
P&G was little changed at $69.26 at the close in New York. The shares have gained 3.8 percent this year.
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