Yorkshire Water’s chief executive has announced she is to step down, just 24 hours after the company was given the lowest possible environmental rating by the Environment Agency

Nicola Shaw, who has led the firm since 2022, will leave the role on 1 January to be replaced by Nicola Medalova, a chartered environmental health officer who previously worked for the National Grid.

In a statement on Friday, Shaw said it had been a “privilege” to lead the company but that it was “the right time” to leave her post.

Shaw has faced criticism in recent years, including for taking £1.3m in undisclosed payments between 2023 and 2025, while the company has come under scrutiny for its performance.

On Thursday, the Environment Agency gave the firm one star out of four – its lowest possible rating – meaning Yorkshire Water was classed as a “poorly performing company”.

The EA said Yorkshire Water was responsible for 260 pollution incidents in 2025, which was its highest total since 2011.

In 2024, Ofwat announced it was fining the company £47m for historic sewage leaks.

In her statement, Shaw said: “It has been a privilege to lead Yorkshire Water and serve the people of Yorkshire.

“Although there remains a huge amount of work to do, I am extremely proud of what our colleagues have achieved, putting the business on a stronger footing for delivery across all aspects of its work.”

Yorkshire Water said Medalova would join the company on Monday as part of a transition period before assuming the chief executive officer role full time in the new year.

She said: “I am delighted to be joining Yorkshire Water and grateful to the Board for the opportunity to lead the business through its next chapter.

“Yorkshire Water faces huge challenges but also great opportunities for continued improvement and I look forward to working with Nicola Shaw, the leadership team and colleagues across the business as I get up to speed.”

In December last year Shaw said “not being transparent” about receiving £1.3m in shareholder-funded payments across two instalments had been a “mistake”, but had insisted those amounts were “not for me to decide”.

The previously undisclosed payments had come to light the previous August when the government banned Yorkshire Water and five other water companies from paying “unfair” bonuses to bosses.

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