One week after Howard Schultz shocked the beverage industry with the announcement that he will relinquish his title of CEO of Starbucks, another beverage chief executive has said that he, too, has plans to leave his post: Coca-Cola chief Muhtar Kent said Friday that he will step down next year, after a rough eight-year tenure leading of the beverage giant.
The Coca-Cola Company announced Friday that the board of directors has approved a plan that will see Kent step down from his role as CEO on May 1, 2017. He will hand his title to James Quincey, who currently serves as the company’s president and chief operating officer.
Kent will retain his title as chairman of the board.
“It has been the most wonderful and unique privilege to serve as chairman and CEO of our great company over the past eight years,” Kent said in a statement Friday morning. He went on to say that managing the company requires a “thoughtful and orderly” succession plan, and Friday’s announcement not only ensures that orderly process but puts in place someone who is prepared to lead the $180 billion beverage giant.
“Having worked closely with James during the past 10 years of his 20-year career with our company, I know that his vast industry knowledge, expertise with our brands, values and system, coupled with an acute understanding of evolving consumer tastes, make him the ideal candidate to effectively lead our company and bottling system. James has the strategic vision and inspirational leadership to usher in the next phase of growth for our great business,” Kent said.
Kent first joined Coca-Cola in 1978; by 1985, he was the general manager of Coca-Cola Turkey and Central Asia. He left Coke in 1999 for a six-year run as president and CEO of the Turkey-based Efes Beverage Group, but returned to Coke in 2005 as president and COO of its North Asia, Eurasia and Middle East group. He became Coke CEO in April of 2009.
As CEO, Kent has helped Coke look beyond the world of soda. Last year, he shepherded the company’s $2 billion investment in energy-drink maker Monster Beverage (the deal was announced in 2014 and closed in June 2015) and also oversaw its minority stake in Suja Juice, a cold-pressed organic juice company that has been named to FORBES’ Most Promising Companies list and whose co-founder has appeared on the 30 Under 30 in food and drink.
As president and COO, Quincey is already responsible for helping Coke to respond to changing consumer tastes; Friday’s release credited recent changes — including smaller package sizes and 200 initiatives to reduce added sugar — to Quincey’s leadership. During the company’s third quarter earnings call in October, it was Quincey who took point in explaining Coke’s strategies for navigating what is an increasingly sugar-wary environment. “We are expanding the selection of low- and no-calorie products. And we are reformulating products to reduce added sugars,” he said at the time.
“I am truly honored and humbled to lead this great company into the future,” Quincey said in a statement Friday. “Muhtar has been a catalyst for change at The Coca-Cola Company – driving the transformation of our global bottling system, expanding our product portfolio and making sustainability a business imperative. I am committed to continuing my strong partnership with Muhtar, our talented management team and associates, and our valued bottling partners to continue this momentum and capture the enormous opportunities in front of us.”
Billionaire and prominent Coke shareholder Warren Buffett seems pleased with the succession plan; in a statement Friday morning, Buffett called Kent an “excellent steward of Coca-Cola’s business over the last eight years” and said he is “thankful for the leadership he has provided to put in place the right vision, strategy and thoughtful succession plan for long-term success.” Of Quincey, Buffett said: “I know James and like him, and believe the company has made a smart investment in its future with his selection.”
Investors also appear satisfied with the plan: shares of Coke opened Friday trading in positive territory and are currently up 2.8%. Year-to-date, the stock is down 1.9%.