(Bloomberg) -- Archer-Daniels-Midland Co. — working to put an accounting scandal behind it — has hired a 3M Co. executive to oversee its finances and help restore its credibility with shareholders.
3M’s Monish Patolawala will become ADM’s Chief Financial Officer on Aug. 1, the agricultural commodities trader said in a statement.
Patolawala’s appointment brings to an end a six-month period of interim leadership in ADM’s finance department. Former CFO Vikram Luthar was placed on administrative leave in January and had agreed to resign effective Sept. 30 amid an accounting investigation that sent the company’s shares plunging. Ismael Roig, ADM’s president of Europe, Middle East and Africa and the animal nutrition unit, has been serving as interim CFO.
Hiring someone from outside the company was likely a strategic decision as the company looks to distance itself from the earlier problems, according to Seth Goldstein, an analyst at Morningstar Inc.
“They wanted to get someone outside to be in that prominent leadership position and have the final say on ADM’s accounting practices going forward,” Goldstein said. Patolawala “has a very strong background” and is a good fit for the job, he added.
The new CFO will take over at a time when the agribusiness giant is seeking to turn around its troubled nutrition unit while weathering a downturn in crop prices and processing margins. With the new hire, ADM takes another step toward normalcy after the scandal, which shook the commodity trading world and wiped out more than $8 billion of the company’s market value in a single day.
In March, ADM disclosed a $137 million impairment charge related to its animal nutrition business after an internal probe, bringing relief to investors that feared the fallout would be worse. The company is still under investigation by the US Securities and Exchange Commission and the Department of Justice.
ADM shares were up about 0.5% as of 1 p.m. in New York. The company is down about 12% since the start of this year.
(Updates with analyst comment starting in fourth paragraph)
©2024 Bloomberg L.P.