3M's Key Manager Dismissal: Unveiling the Impact and Implications
Last week, beleaguered industrial conglomerate 3M (NYSE: MMM) dismissed recently installed Group President and Chief Business and Country Officer Michael Vale due to "inappropriate personal conduct and violation of company policy." Vale was arguably the second-most-important executive at the company, but does his departure significantly impact the investment case for the company?
Any attempt to guess the reason for Vale's dismissal is a fruitless exercise. Suffice it to say that 3M said it was "unrelated to the company's operations and financial performance," and he also resigned from his position on the board of directors of outdoor equipment company The Toro Company.
However, there's little doubt that Vale's departure is significant. 3M's operations are structured into four business segments. One of them, healthcare, is set to be spun off by the end of 2023. But the group presidents of the remaining three (safety and industrial group, transportation and electronics group, and consumer group) all reported to Vale. When Vale's promotion to the newly created role was announced -- in conjunction with the company's April 25 earnings report -- it said he would report directly to CEO Mike Roman. And it was clear that the 30-year 3M veteran was a critical part of the company's restructuring plan.
Source Fool.com
