October 26, 2022 [Reuters] – Armando Martinez will become chief executive officer of Iberdrola (IBE.MC) after Europe’s leading power utility opted to separate the positions of executive chairman and CEO as the sector faces a challenging transition towards greener energy.
Iberdrola said on Tuesday that following the proposal of the appointments committee, Jose Ignacio Sanchez Galan would stay on as executive chairman of the company.
Shares in Iberdrola rose 2.38% by 1456 GMT, while Spain’s leading blue-chip index (.IBEX) Ibex-35 was up 1.43%.
Reelected as executive chairman in 2019 for a period of four years, Galan, 72, has been at the helm of Iberdrola for more than 16 years and made it one of the world’s leading renewable power generators, with a sizeable investment plan worth 150 billion euros ($149.31 billion) through 2030.
As opposed to the Anglo-Saxon corporate governance model, the main executive at large Spanish companies is the chairman, who is in charge of the company’s strategy, while the CEO is tasked with overseeing daily business decisions.
Fernando Garcia, a London-based utilities analyst at RBC Capital Markets, did not expect the appointment to change Iberdrola’s strategy in the short term, but said “the question now is whether this change somehow opens the door for Galan’s replacement at some point in the future.”
Martinez, 54, who is married with three children, has been head of the company’s business division and worked in the electricity sector for over twenty years. His experience involved engineering, constructing and operating power plants.
He worked in Mexico in 2000-2014, where he held several senior managerial posts within the group, including director of operations and general director of Iberdrola Mexico.
The separation of positions at Iberdrola also comes at a time when some governments have moved to impose windfall taxes on energy companies they believe are benefiting from higher prices.
Iberdrola has been vocal among companies objecting to state intervention, saying they fix prices far in advance of wholesale market rises and that changing regulations might put off longer-term investment in cleaner energy.
The company, which is reporting third-quarter results on Wednesday, will hold a capital markets day on Nov. 9.
($1 = 1.0046 euros)
Reporting by Jesús Aguado
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