Ecolab’s Doug Baker to Retire After 16-Year Run as CEO
Doug Baker, who built Ecolab’s global sales while emphasizing corporate responsibility, will retire as CEO on Jan. 1, but he will retain his role as chairman.
The St. Paul-based corporation announced late Thursday that Baker will be succeeded by Ecolab veteran Christophe Beck, who serves as president and chief operating officer. Beck joined the company in 2007. Before he arrived at Ecolab, Beck was a Nestle executive for 16 years.
Ecolab’s reputation and public image have been closely tied to Baker, who became CEO of Ecolab in 2004. During his tenure, he grew the company through its traditional lines of business that include cleaning and sanitizing, but he also presided over major acquisitions.
Within the Minnesota business community, he is one of the most prominent CEOs of public companies. After Covid-19’s March arrival, Baker loaned one of his executives to help the state of Minnesota acquire personal protective equipment (PPE). He enlisted other Minnesota companies to do the same, and he appeared with Gov. Tim Walz to describe the public-private partnership to fight the coronavirus.
Baker also has had a huge impact on St. Paul’s community life. He co-chaired the $40 million fundraising campaign for a two-building homeless shelter and social service nexus. In a TCB profile of Baker, former St. Paul Mayor Chris Coleman said: “He is the most level-headed, no-B.S. guy that I think I’ve ever worked with. He’s very straightforward, but not in any kind of a mean-spirited way. He’s extremely even-keeled. Just kind of the Joe DiMaggio of CEOs.”
Baker’s ability to perform under pressure has been evident this year during the pandemic. When the coronavirus was forcing the economy into partial-shutdown mode, he drew on his experience leading Ecolab during the Great Recession.
Ecolab quickly increased its cash reserves to $1.25 billion, so it would have a solid financial cushion while customer segments of its business—restaurants and lodging—fell sharply. Baker also moved to preserve jobs, extend sick pay and expand health care benefits.
“The way we are thinking about the company is we want to manage through this in a way that basically enables us to come through healthy,” Baker said in an April interview with TCB.
Ecolab’s Covid recovery
Ecolab released its third quarter results Tuesday, which showed that its sales were down 6 percent from the year ago period.
“Third quarter sales and earnings showed significant improvement from the Covid-19 related lows in the second quarter, principally led by our institutional division,” Baker said in a prepared statement.
“We expect the improvement to continue in our fourth quarter, though likely at a slower rate as the second Covid-19 wave impacts re-openings,” Baker said. “Our accelerated investments in hand care and sanitizer capacity are paying off. Our continued digital investments and accelerated field technology deployment are enabling us to provide excellent customer support even when we cannot be there in person.”
In 2019, Ecolab recorded $14.9 billion in sales. In Thursday’s release, it used a $13 billion figure for annual sales, which are expected to be down in 2020 because of the impact of Covid-19. Ecolab employs about 45,000 people and serves customers in more than 170 countries. Its primary customers are in the food, healthcare, hospitality and industrial sectors.
Passing the torch
Baker, 61, spent nearly his entire professional career at Ecolab. After playing hockey and graduating with a degree in English from the College of the Holy Cross in Massachusetts, Baker made his foray into the business world. He worked for seven years in brand management for Procter & Gamble and then arrived at Ecolab in 1989.
His performance in marketing and general management roles at Ecolab, in the United States and Europe, propelled him to become Ecolab’s president and CEO in 2004. Two years later, the chairman’s role was added to his portfolio.
“Under his leadership, Ecolab has become a true sustainability leader and a purpose-driven company, recognized for its positive impact on the world and for its ethical practices,” said Jeffrey Ettinger, Ecolab’s lead director, in a written statement. “All of this helped drive exceptional returns for our shareholders, increasing Ecolab’s market capitalization by more than eight times and generating a $50 billion increase in the company’s value.”
Ettinger noted how Baker had broadened Ecolab’s markets by adding water sustainability and healthcare and life sciences businesses.
In 2011, Ecolab entered the energy business through the acquisition of Nalco, a major water treatment and process improvement company. Two years later, it acquired Champion Technologies, a Texas-based energy specialty products and services company. Beck, 52, previously served as president of Ecolab’s Nalco Water business.
In official statements released by Ecolab Thursday, the elevation of Beck was characterized as a seamless transition. “This announcement follows a well-planned and thoughtful succession process,” Ettinger said. “Christophe Beck is a proven leader.”
Beck, after thanking Baker for giving him the career opportunities to prepare him to become CEO, said, “We hold the same vision for Ecolab.”
Baker described Beck as the “perfect choice” to succeed him as CEO. He noted they had worked together to develop Ecolab’s strategy and build the business. “He is a great business leader, and even more importantly, a good person,” Baker said.
While Baker’s long tenure produced strong financial results for Ecolab, his brand of leadership drew wide respect among fellow business and community leaders. “Everybody who works with him says this is a strong, focused guy who gets things done,” said Charlie Weaver, executive director of the Minnesota Business Partnership, in a 2017 TCB interview. “He’s self-effacing and doesn’t take himself too seriously, which I think is part of his success. Grounded is a great word for Doug. He’s very grounded.”