GlaxoSmithKline's Witty to retire in early 2017

Bowing to pressure from institutional shareholders, GlaxoSmithKline chief executive Andrew Witty has decided to retire from the company at the end of March next year.

The FTSE 100 drug maker will now conduct a formal search for a successor, though reports have indicated it has been putting feelers out for some months, with the board stating it will consider internal and external candidates for the role.

By the time he retires, Witty will have headed the company for nigh-on a decade, having taken the reins in May 2008 and having originally joined Glaxo in 1985.

Chairman Philip Hampton, who has had investors such as activist hedge fund Och-Ziff lobbying for change, said: "Andrew's retirement next year will represent the culmination of 32 years of service and leadership to GSK and the industry.

"We will thank Andrew more formally for his tremendous dedication and contribution next year. In the meantime, we will now start a formal process to appoint his successor, whilst also ensuring the group remains focussed on execution of its strategy to drive growth and performance."

Och-Ziff and other investors such as Neil Woodford, the influential British fund manager, have been calling for GSK to be broken up into at least two or three businesses so that its drug making activities would be separated from its consumer good arms.

Woodford later on Thursday called for an external appointment over an internal promotion, saying GSK needed "a fresh pair of eyes".

"I have a strong preference for an external candidate," he told Sky News.

Woodford and others see more value in GSK splitting its HIV drug business, its consumer healthcare division and Stiefel, its dermatology division, from its core medicines and vaccines arm.

Mooted possible internal candidates have included Emma Walmsley, who runs GSK's consumer products division, and Abbas Hussain, president of its global pharmaceuticals unit.

Glaxo also announced that board members Deryck Maughan, Stephanie Burns, Daniel Podolsky and Hans Wijers will not stand for re-election at the annual shareholder meeting on 5 May, as part of "the usual cycle of board refreshment".

Maughan has served as independent non-executive director on the board since 2004, Burns and Podolsky both for nine years, and Wijers three.