SOUTH West Water chief executive officer, Susan Davy, has announced her decision to step down, marking the end of an 18-year career with the utility giant and its parent company, Pennon Group.

Her departure also signals her retirement from the Pennon Group board, where she has served as CEO since July 2020, following five years as chief financial officer.

In a statement released today, Ms Davy said the time was right to “pass leadership to a new generation” after nearly three decades in the water industry.

Her retirement comes at a critical moment for South West Water, just one day after industry regulator Ofwat published damning findings about the company’s wastewater operations.

Ofwat's investigation uncovered a “range of failures” at South West Water, including inadequate management of wastewater treatment works and sewer networks, as well as weak oversight from senior leadership and the board. The regulator concluded that the company had “failed to meet its legal obligations.”

In response, South West Water has proposed a £24-million enforcement package aimed at tackling storm overflows, addressing sewer misuse, and funding environmental initiatives. The package will be funded by the company and its shareholders – avoiding what would have been a £19-million fine, equivalent to 6.5 per cent of annual turnover, payable to the Treasury.

South West Water has proposed a firm enforcement package totalling £24-million during the current price control period (2025–2030). The measures include:

· Investing £20-million during 2025-30 to reduce spills from specific storm overflows. This investment will target overflows in environmentally sensitive areas or within focused community areas.

· Establishing a £2-million local fund to tackle sewer misuse and misconnections, which can contribute to environmental pollution.

· Providing £2-million of funding through a Nature Recovery Fund to support environmental groups in delivering local environmental improvements. In addition the company will commit to taking the necessary steps to address the failures Ofwat has identified, securing its future compliance.

Furthermore, SWW has committed to a range of internal reforms aimed at restoring compliance and preventing future failings, including governance overhauls and operational enhancements.

The enforcement proposal forms part of a broader review by Ofwat and the Environment Agency into all water and wastewater companies in England and Wales.

Ofwat’s senior director for enforcement, Lynn Parker, said: “Water companies should be in no doubt they will be held to account if they fail to meet their legal obligations to customers and the environment. Our investigation found a range of failures in how South West Water has gone about managing its wastewater business. That is why we have secured the £24-million package and a commitment to put things right.”

Reflecting on her tenure, Ms Davy said: “It has been an honour to serve as Chief Executive Officer of Pennon. Running a water company is always interesting, often challenging, but totally fulfilling. I have enjoyed taking responsibility for providing a sustainable service to millions of homes.”

She added that Ofwat’s recent approval of Pennon’s investment plans provided a “natural juncture” for her to retire.

A successor will be announced in due course.