British American Tobacco reshuffles board in strategy shift for new chief

A major boardroom reshuffle at British American Tobacco will create a new chief operating officer role and result in six executive job moves, as the cigarette maker’s new chief attempts to move faster towards products such as vapes and revive US growth.

Two longtime BAT executives — Johan Vandermeulen and Kingsley Wheaton — will extend their influence as a result of the shake-up, which comes just a month after the board suddenly dismissed Jack Bowles, the chief executive of four years, and installed finance chief Tadeu Marroco in his place.

Vandermeulen will assume a newly created chief operating officer role, overseeing the cigarette maker’s regional operations including US-based Reynolds American, while Wheaton will become chief strategy and growth officer, taking on responsibility for the tobacco giant’s vaping drive and its ESG push.

Rae Maile, tobacco analyst at Panmure Gordon, said the shake-up was Marroco “stamping his mark” on the Lucky Strike and Dunhill maker. “This is putting in place his team to support him with his objectives,” said Maile. “The board structure had also got horrifically complicated so this is a long overdue simplification.”

The executives directly in charge of BAT’s US-based subsidiary Reynolds American and the cigarette maker’s new categories segment, which includes its popular Vuse vaping device, were both dismissed as part of the shake-up.

Maile said that a “refreshed approach” would probably be welcomed by investors. Shareholders have previously expressed frustration at BAT’s sluggish transition to reduced-harm products, such as vapes, which account for around 14 per cent of group revenues, compared with more than a third for US rival Philip Morris International.

Moreover, Marroco admitted earlier this month in a trading statement that US cigarette sales, which account for more than a third of group revenues, were “disappointing”, as the company reported a 0.4 per cent fall in dollar market share in cigarette sales.

Shares in the London-listed group were flat in early morning trading.

David Waterfield, BAT’s western Europe head, will become president and chief executive of Reynolds from the start of July, and Luciano Comin, who ran BAT’s Americas and sub-Saharan Africa divisions, will assume the new role of marketing director for combustible and new categories. All hires and promotions in the shake-up were made internally.

Marroco said in a statement that the management reshuffle was “critical” to his attempts to overhaul the cigarette maker, “enabling simultaneous performance and transformation”.

He assumed the top job soon after BAT agreed to pay a $635mn penalty over breaches of US sanctions on North Korea.