Durk Jager, the veteran chief executive of Procter & Gamble was ousted yesterday after the multinational mammoth issued its third profits warning of the year. Mr Jager - who also doubled as P&G’s chairman and president - announced his intention to retire immediately after just eighteen months in the driving seat.

Alan Lafley, president of P&G's global beauty care business, was elected by the board as chief executive, while previous chairman John Pepper emerged from retirement to reoccupy his old post.

According to analysts, Jager’s downfall was due to “over-ambitious and aggressive forecasting”, plus a bungled attempt to modernise P&G's culture. His attempt to improve sales growth had undermined profits as spending ran out of control. The company's market value had dropped from $165bn in January to the current level of less than $85bn.

Under Jager, the company became much more bullish on growth, but alienated investors by consistently failing to deliver. Mr Lafely said P&G would revise its forecasts to more conservative levels.

News source: Financial Times