We're a global leader in premium drinks, one of the most dynamic consumer categories.
A year of change
This has been a year of significant change for Diageo, but one in which we have taken important steps to drive the company’s transformation.
The operating environment has remained volatile, largely owing to continued macroeconomic and geopolitical uncertainty. We also recognise that Diageo should be doing more to reach its potential. I want to be clear about that. As we close the fiscal, we are looking to Diageo’s future with confidence and conviction.
Whilst we continue to face challenges, spirits remain an attractive and resilient category, with growth in Europe, LAC, Africa and Asia Pacific (when excluding Chinese White Spirits). There is much work to be done, particularly in North America, which remains a softer market, but as a Board we are encouraged by the new direction of the business and the progress made in establishing a clearer path forward.
When I wrote to you a year ago, I said my immediate focus was to appoint the right Chief Executive. I would like to thank Nik Jhangiani for his leadership as Interim Chief Executive while the Board and I focused on that process.
In November, we were delighted to announce the appointment of Sir Dave Lewis as Chief Executive. Dave joined the business in January and has made a strong start.
He is a proven Chief Executive with extensive marketing and brand-building experience, coupled with an outstanding track record of leading global consumer businesses.
The Board is confident that Dave will work with the team to lead Diageo through its next successful chapter.
He has hit the ground running, spending time across the regions, listening to colleagues, customers and partners, and working with his leadership team to establish a clear view of what needs to change. In early August, he updated both our employees and then investors on his plans and strategy.
This strategy sets out some of the significant moves that are already being implemented across the business, including changes to the operating framework to make Diageo more competitive. We recognise that changes of this scale can be difficult in the short term, and I would like to thank colleagues across Diageo for the commitment and passion they have shown throughout the year.
Under Dave and his leadership team, the Board is confident that Diageo is on the right path to returning to consistent growth and delivering stronger shareholder returns.
Leadership changes
Alongside the appointment of a new Chief Executive, the composition of the Board has continued to evolve.
We were delighted to welcome John Rishton as a Non-Executive Director in November 2025. John brings more than 40 years of experience across large multinational companies and global industries, including senior roles at Rolls-Royce, Informa and British Airways.
He has joined the Audit and Nomination Committees, and I would like to thank him for the contribution he has already made.
The Board will also be strengthened by the appointment of Alex Keith, who joins in November. She brings with her more than 30 years of leadership experience at Procter & Gamble, most recently as CEO of P&G Beauty, alongside expertise in strategy, brand-building, international business, and sustainability.
In addition to these Board changes, this financial year has marked a period of change for Diageo’s Executive Committee.
While Nik Jhangiani served as Interim Chief Executive, Deirdre Mahlan returned as Interim Chief Financial Officer. We are very grateful to Deirdre for once again supporting Diageo and for her many contributions over the course of her distinguished career with the company. The Board also supported the Chief Executive as he reshaped his Executive Committee for fiscal 27 and beyond, as detailed in his statement.
Having the right management team in place is essential to delivering Diageo’s strategic priorities and strengthening performance. The Board is confident that the reshaped Executive Committee brings the experience, focus and energy needed to do so.
Spirit of Progress
As we reshape the business, we are also maintaining our focus on the areas that are central to Diageo’s long-term resilience and values.
We have continued to make progress against our Spirit of Progress ESG action plan and have achieved our ambition of replenishing more water than we use in our operations in water-stressed areas, with work continuing across markets including Mexico, India and countries across Africa.
Water stewardship remains critical to the resilience of our operations and to the communities in which we operate. It is one of the areas where Diageo can make a substantial and lasting contribution.
Positive drinking also remains central to our approach. Ahead of the FIFA World Cup this year, we launched “The Best Move: Celebrate Responsibly” across Latin America and the Caribbean, using the reach of the tournament and our brands to encourage simple moderation habits and responsible celebration.
While Spirit of Progress is no longer part of the long-term incentive plan, the accelerated work undertaken in recent years has embedded its priorities more deeply within the business and will continue to be a focus for the Board.
Together, this work reflects our continued commitment to using Diageo’s scale and influence responsibly, while supporting the long-term resilience of the business and the communities in which we operate.
Looking forward
The decisions made this year have laid the foundations for the next phase of Diageo’s transformation.
I believe we will look back on this financial year as a year in which we took important steps to set the business up for the future.
We are clear on Diageo’s growth priorities and, as a Board, we believe we have the right leadership, culture and strategy in place to deliver on them.
There remains much to do, and we do not underestimate the challenges ahead. However, we remain confident in the fundamentals of the business; in the long-term attractiveness of the spirits market and the role of our spirits portfolio, including RTDs; in the continued growth potential of Guinness; and in the strength of Diageo’s market positions.
I am encouraged by the start Dave and his team have made and the work they are doing to accelerate Diageo’s repositioning into a fundamentally more competitive business, capable of delivering sustainable growth and long-term value for shareholders.
Finally, I would like to thank all our colleagues that were part of the journey this past year. Their commitment, resilience and passion for our brands have been deeply appreciated throughout a demanding time.
The Board and I look forward to working with Dave, his leadership team and colleagues across Diageo as we take the company into its next chapter.
Sir John Manzoni
Chair
Statement on section 172 of the Companies Act 2006
Section 172 of the Companies Act 2006 requires the Directors to promote the success of the company for the benefit of the members as a whole, having regard to the interests of stakeholders in their decision-making. In making decisions, the Directors consider what is most likely to promote the success of the company for its shareholders in the long term, as well as the interests of the group’s stakeholders. The Directors understand the importance of taking into account the views of stakeholders and the impact of the company’s activities on local communities, the environment, including climate change, and the group’s reputation.
Read more about how stakeholders were taken into account in decision-making on pages 80-86.