Reckitt appoints Rakesh Kapoor as CEO-designate

Will join a list of India-born executives heading international organisations

The importance of India in UK-based Reckitt Benckiser's scheme of things is growing, with the appointment of RB veteran Rakesh Kapoor as CEO-designate after incumbent Bart Becht offered to step down.

The news comes four months after the Slough-headquartered company acquired the Ahmedabad-based Paras Pharmaceuticals for Rs 3,260 crore. Reckitt has just completed this acquisition following regulatory approvals received for the transaction.

Kapoor (52), who until now was executive vice-president, global category development, was involved in the Paras acquisition and others such as SSL and Boots. He will formally take over as the chief executive on September 1. Becht will continue as part-time advisor to Kapoor and the board till September 2012.

Kapoor will effectively join a list of India-born executives, who are at the helm of international organisations, including Vikram Pandit at Citigroup and Ajay Banga at Mastercard.

While the export of talent from the Indian arms of international consumer products firms has been common for a few decades, this is possibly the first instance where an Indian has been promoted to the role of chief executive officer.

The last time an Indian was close to bagging the top job at a consumer goods company was when Manvinder Singh Banga, the brother of Ajay Banga, was in the race for the position of chief executive at Anglo-Dutch major Unilever over two years ago. But the latter chose 'outsider' Paul Polman instead, who then ran the Americas business at rival Nestle.

Kapoor's appointment, in contrast, was unanimous, according to Reckitt's chairman Adrian Bellamy. "The board is delighted that someone of Rakesh Kapoor’s calibre is able to step into the role of CEO. His close involvement in the drivers of success and significant achievements to date are reassurance that the excellent performance for which RB has become renowned is set to continue. Rakesh has the necessary drive, strategic thinking and operational experience coupled with a more than intimate understanding of and capability to improve RB's financial performance and earnings model. He is supported by an excellent team of senior executives," Bellamy said.

A chemical engineer from BITS, Pilani, with an MBA from XLRI, Jamshedpur, Kapoor began his innings at Reckitt & Coleman in 1987 as a regional sales manager. He moved up the ranks eventually going abroad to lead the UK and north European businesses of the entity. He was appointed to Reckitt's executive committee in 2006 to lead two key initiatives — power brands and innovations. According to company insiders he has extensive experience of household, healthcare and personal care categories, and has an understanding of both developing and developed markets.

This should come in handy as Kapoor seeks to infuse confidence in the stock. This has taken a severe beating following Reckitt's fourth quarter earnings for 2010,  which missed analysts estimates. In 2010, revenue growth was only six per cent on the back of stagnant markets in the West. Its hope remains on emerging markets which grew 18 per cent during the year. North America and Australia grew three per cent only, while Europe saw no growth at all in 2010.