CFO at 29? Kraft Heinz Move Spotlights a Pattern at Investor 3G Capital - WSJ
Appoint young executives, groom them to your liking—and save some money while you’re at it. That seems to be Brazilian private-equity firm 3G Capital Partners LP’s playbook for the companies it controls.
Kraft Heinz Co., the firm’s biggest investment and the fifth-largest food company in the world, recently named 29-year-old David Knopf as its chief financial officer. In giving the job to Mr. Knopf, a 3G partner who joined the food company in 2015, Kraft Heinz passed over an accounting officer with more than a decade of experience in the food business. 3G has a history of appointing young financiers often from its own ranks to top positions, replacing industry veterans. Such moves are a departure from strategies generally employed at other publicly traded companies, especially those the size of Kraft Heinz, which has nearly $30 billion in annual sales and a market capitalization of about $100 billion. 3G remains the company’s largest shareholder, after orchestrating the merger that formed the food giant in 2015. Publicly traded companies even half Kraft Heinz’s size often hire older executives with more operating experience for top roles. Since December, General Mills Inc. and Hershey Co. have both installed new chief executives who have worked in Big Food for decades. Mondelez International Inc. last month named its new CEO: Dirk Van de Put, an industry veteran who was leading Canada’s closely held McCain Foods Ltd. When Mr. Knopf takes on his new role in October, he will be the youngest CFO among Fortune 500 companies, according to data provider BoardEx.
The average age of finance chiefs in the top 1,000 U.S. companies is 51 years old, according to Korn/Ferry International , an executive recruiting firm. The average age of someone starting a CFO role is 50. Age may not be an absolute proxy for experience, experts say, as finance chiefs today focus on operations, technology and company strategy while more traditional functions of accounting and regulatory reporting can fall to others, such as a global controller. Kraft Heinz has a veteran in that role, and Mr. Knopf’s predecessor, Paulo Basilio, a 3G partner since 2012, will remain at the company as president of its U.S. business. Mr. Knopf “is still green in some areas, but it’s my job to develop him,” said Kraft Heinz Chief Executive Bernardo Hees, also a 3G partner, at a lunch with business executives in Chicago last week. But he is ready to take on more at the company, Mr. Hees added. Mr. Knopf played a role in the Kraft Heinz merger, a deal valued at roughly $50 billion. Once it was completed, he became a vice president of finance for the new company and is currently leading the Planters business.
3G co-founder Jorge Paulo Lemann is known in the industry for nurturing young talent, according to Giovanni Lamarca, a managing director at recruiting firm RSR Partners. “One of his strengths is detecting the diamond in need of polish,” Mr. Lamarca said. The company operates on principles of meritocracy, rewarding hardworking, high performers with rapid promotions. After 3G acquired H.J. Heinz Co. in 2013 with the help of Berkshire Hathaway’s Warren Buffett, it quickly replaced nearly all of Heinz’s top executives with 3G partners or younger, lower-level Heinz employees. Mr. Hees, who was 43 at the time, became CEO, succeeding the 64-year-old, longtime chief. At Burger King, 3G partner Daniel Schwartz was appointed chief financial officer following the private-equity firm’s 2010 purchase. At the time, he was the youngest CFO among top 1,000 companies, according to Korn/Ferry. Three years later, Mr. Schwartz, then 32, became CEO of the company, now run as Restaurant Brands International Inc. 3G’s “playbook is different,” and elevating young, private-equity partners to operational roles gives the firm the advantage of having leaders it can “groom and mold” to its culture, said Peter Crist, chairman of executive search firm Crist | Kolder Associates.
The strategy has also saved money on executive salaries. Despite Kraft Heinz’s total shareholder return outperforming the industry, Mr. Hees’s salary last year was 60% less than what Mondelez paid CEO Irene Rosenfeld in 2016. And chief financial officers at smaller peers Kellogg Co. and General Mills Inc. each received over a million dollars more in total compensation than Mr. Basilio, Kraft Heinz’s outgoing CFO. The company hasn’t disclosed Mr. Knopf’s salary. In an interview earlier this year, Mr. Hees said compensation at Kraft Heinz aligns with 3G’s strategy of thinking long-term—a plan that inherently lends itself to younger, rising stars. 3G has sought cost savings across the board at the companies it manages, selling private jets, cracking down on color printing, closing dozens of factories and laying off thousands of employees. Through the Kraft Heinz merger, it estimates it will cut $2 billion in annual costs.
) negli ultimi 5 anni alzato al 14,3% e previsto aumento 2017 all'8,75%:
