Management Turnover as Change Agent

Thursday, April 19, 2007

A CEO Change Back in August Worth Noting

Back in early September, I selected six companies out of a total two hundred and thirty three CEO related changes I recommended investors re-examine for investment possiblities. One of the six was Clorox (CLX - NYSE).

On August 30, 2006 Clorox announced that Donald R. Knauss would be named chairman and chief executive officer to be effective in early October. For nearly six months Clorox had experienced a number of management changes at the top which first started back in March of 2006, when its chairman and chief executive officer Gerald E. Johnston was hospitalized for a heart attack on March 1. Initially, the company appointed an interim chairman and chief executive, Robert W. Matshullat the presiding director of the company's board of directors, to take Johnston's place. Two months later, Johnston announced his formal retirement from the firm. Finally at the end of August, Clorox found Johnston's replacement.

I considered Knauss' selection an excellent choice. He previously worked as a senior executive for Coca Cola for twelve years. His last position before joining Clorox was president and chief operating officer of Coca Cola North America. Knauss had extensive experience in consumer marketing and operations which was a perfect fit for Clorox job. Prior to his work at Coca Cola he worked for different divisions at Pepsi and earlier began his career with Proctor & Gamble.

Keep an eye on Knauss.

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