He will take the helm of the FTSE 100 company on 1 January. The appointment is considered a significant coup for the maker of Guinness, Johnnie Walker whisky, and Smirnoff vodka.

Mr Lewis, who ran Tesco from 2014 to 2020 and previously spent nearly three decades at Unilever, is renowned for his turnaround skills. At Tesco, he navigated a major accounting scandal, halved a £22 billion debt pile, and successfully repositioned the supermarket against rivals Aldi and Lidl.

Mr Lewis faces a substantial challenge at Diageo, which owns over 200 brands. The company’s shares have fallen by a third this year following a shock profits warning in 2023. It has struggled with global consumer headwinds, misjudged waning demand in Latin America, and faced supply chain issues that led to Guinness rationing in UK pubs last Christmas.

A recent profit warning, citing flat 2026 sales expectations, sent its shares to a 10-year low. He replaces Debra Crew, who stepped down in July. Nik Jhangiani, the CFO who served as interim CEO, will return to his financial role.

To take the new post, Mr Lewis will step down as chair of consumer health business Haleon on 31 December. Haleon has named Vindi Banga, another Unilever veteran, as his successor. 

Mr Lewis is also a non-executive board director of PepsiCo Inc.

The market reacted positively to the news, with Diageo shares climbing 7% today, while Haleon shares dipped.

Sir John Manzoni, Diageo’s Chair, who led the succession process on behalf of the board, said: “We are delighted to welcome Dave as Diageo’s new CEO.

“Having conducted an extensive and thorough global search, the board unanimously felt that Dave has both the extensive CEO experience, and the proven leadership skills in building and marketing world-leading brands, that is right for Diageo at this time.”

Mr Manzoni continued: “We are confident that Dave will work with the team to take Diageo into its next successful chapter in the evolving consumer environment. The Board wishes to recognise and thank Nik Jhangiani for his excellent leadership as Interim CEO and for continuing to drive forward Diageo’s sharpened strategy.”

Mr Lewis said: “Diageo is a world leading business with a portfolio of very strong brands, and I am delighted to be joining the team.

“The market faces some headwinds but there are also significant opportunities. I look forward to working with the team to face these challenges and realise some of the opportunities in a way which creates shareholder value.”

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: “Lewis brings deep experience in consumer brands from his time leading Tesco and decades at Unilever, though he lacks direct exposure to the spirits industry.

“Investors may welcome his strong marketing pedigree, but any major strategic reset will take time, leaving near-term focus on navigating tough trading conditions.”