McDonald's promotion from chief operating officer had been expected at least since early March. But whenever Lafley had been asked about CEO succession in public, he maintained he was focusing on running the company and planned to do so for some time.
The succession issue also has been on the minds of investors, employees and others because Lafley is considered one of P&G's most successful CEOs, having doubled sales in his nine years, refocused the company on its core strengths and integrated major acquisitions, including Gillette.
The expected transition comes as the company, with $83 billion in annual sales last year, has pulled back from its long-term sales goal of growing 4% to 6% a year. For its 2010 fiscal year, which begins July 1, P&G is forecasting weak sales growth of 1% to 3% and earnings per share that are also well below its long-term goals.
While its stock has been rising since mid-March, it is down 14% year to date, and fell 14.5% in 2008, even though the consumer staples company is often thought to be a recession-resistant stock.
P&G, the world's largest consumer products company, also has outlined plans to more than double its sales over the next 15 years, largely by expanding sales in developing nations such as Brazil, Russia, India and China.