LONDON – Burberry chairman Sir John Peace defended his role in shaking up the company’s top management earlier this week, on the sidelines of the company’s annual meeting on Thursday.

He denied that Christopher Bailey’s dual role as chief creative and chief executive officer had been a failure, and said the decision to bring in a new ceo “is not a reflection of the past, but of our ambitions for the future. There is a lot to be done.”

Bailey has served as chief creative officer and ceo for the past two years, but will relinquish his ceo role to the seasoned luxury manager Marco Gobbetti, ceo of Celine, next year. Bailey will retain his title of chief creative officer and add the new one of president.

Bailey and Gobbetti are planning to run the business together, and both will report to Peace. The changes come in the wake of Burberry’s newly announced strategy and austerity plan that’s been drawn up in response to macro-economic challenges and shrinking demand.

Peace argued that Bailey has shown great leadership, but the company was forced to make the changes when demand for luxury as a whole took a sharp downturn starting in the second quarter of last year.

“Last year, we began to recognize the need to evolve the organization, and Christopher reacted quickly, with a plan for growing the business and making it more efficient,” Peace said. “What the board has recognized is the importance of Christopher focusing on what he’s brilliant at. He’ll have a fantastic partner in Marco, and they have complementary skills. Christopher was one of the catalysts in the decision to appoint a new ceo.”

Peace responded to skepticism that two people could jointly run a public company the size of Burberry, and argued that Bailey had worked “side-by-side” with his predecessor Angela Ahrendts – although Bailey reported to Ahrendts, who was ceo. He added it was not unusual for media or luxury businesses to be run by a management team.

As part of the management shuffle, Julie Brown will take on the new, dual role of chief operating and financial officer, replacing Carol Fairweather and John Smith, who have both said they are stepping down.

Asked why Bailey had originally been given two jobs in the first place, Peace reiterated that Burberry was afraid of losing the designer to a competitor.

“It was an obvious thing for the business to do, and shareholders would have never forgiven the board,” had Bailey decided to follow Ahrendts out the door, Peace said. “He was enthusiastic about taking over as ceo, and it was so obvious to me, to Angela and to Rose Marie Bravo [Burberry plc’s first ceo]” that Bailey was the person for the job.

Peace has been skewered the British press, which blames him for making a terrible decision by giving Bailey the two roles. But he’s clearly not letting it bother him. He told WWD there are no more major management changes planned, and he has every intention to remain in his role.

On Thursday during the annual general meeting at London’s Intercontinental hotel, Burberry shareholders agreed: All 21 resolutions passed, each with a more than 90 percent majority, including the re-election of Peace as a company director.

Burberry shares were down 2.3 percent to 12.50 pounds, or $16.56, at the close of trading on Thursday.