Last April, it seemed possible that Werner Baumann might lose the Bayer CEO job as the Roundup legal burden that he’s responsible for grew heavier. But now, the 57-year-old helmsman has shown that he’s here to stay—for even longer.
Bayer’s supervisory board, under new chairman Norbert Winkeljohann, has decided to extend Baumann’s contract by three years to the end of April 2024, when the German conglomerate’s annual shareholder meeting is expected to take place, the company said Thursday.
It’s definitely a show of support for a CEO who will go down in history as the first to be hit with a shareholder no-confidence vote in postwar Germany.
Disgruntled Bayer investors made their dissatisfaction with Baumann’s management clear last year at the heat of growing U.S. suits that claim the Roundup weedkiller causes cancer. Bayer inherited the legal problem as part of its $63 billion takeover of Monsanto, a deal that Baumann personally championed shortly after taking the reins in 2016, winning backing from then-Chairman Werner Wenning.
Baumann redeemed himself by winning back investor confidence, with 92.6% of votes cast at this year’s annual shareholder meeting going in his favor. The showing came as Bayer published external reports showing that Baumann’s exec team acted dutifully when deciding on the Monsanto acquisition, including carefully evaluating the legal risks.
The company’s supervisory board, meanwhile, is full of praise for Baumann. “Bayer’s strategic strength and robust operational performance are due in large part to Werner Baumann and the entire management team,” Winkeljohann said in a statement, adding that the board is convinced that Baumann is the right leader to advance an ongoing corporate transformation.
The overhaul, unveiled in late 2018, focuses on channeling more resources to the pharmaceutical and crop businesses and has already seen the company shed some consumer health brands, as well as its animal health unit.
Nevertheless, Baumann indicated that 2024 would be his last year with Bayer. Instead of the maximum possible four-year extension that he could have gotten, the board agreed to the current three-year contract to “accommodate my personal plans,” Baumann said in a statement.
A priority on Baumann’s agenda, other than navigating the company through the COVID-19 pandemic, is to wrap up the Roundup brawl with a financially acceptable settlement that could simultaneously resolve current and potential future litigation.
The company said on Thursday that it expects to finalize a revised class settlement plan “over the coming weeks.” Bayer previously reached a potential $10 billion deal with plaintiffs but was forced to withdraw after a judge questioned how potential future cases would be handled.