(Corrects to show Faber became chairman in 2017, paragraph 2) * Activist shareholders had sought changes * Search to start for new chief executive * Faber to remain as non-executive chairman PARIS, March 2 (Reuters) - Shares in Danone slipped on Tuesday after the French food group responded to pressure by splitting the chairman and chief executive roles but left investors questioning whether the shake up went far enough to give a new CEO room to act. Danone said late on Monday Emmanuel Faber - who has been CEO for seven years and took on the chairmanship in 2017 - would stay as a non-executive chairman once a new CEO was found, after activist investors pushed for separating the roles to address underperformance. Shares in the world’s biggest yoghurt maker initially rose as much as 0.9% before reversing course and slipping into negative territory. By 1020 GMT, the stock was down 1.1% at 56.64 euros, well below its all-time 2019 peak above 82 euros. “The market is disappointed by Faber staying on as chairman,” said Gregoire Laverne, a fund manager at Paris-based investment firm APICIL which owns Danone stock. Investment bank Jefferies said the move would be viewed positively by investors such as Artisan Partners, which had pushed for change due to the weak share price and margins at the firm, whose brands include Evian and Actimel. “However, Faber’s presence as chair alongside former CFO Cecile Cabanis as vice-chair is likely to constrain the latitude of any new CEO,” the bank said. Royal Bank of Canada analysts said Danone had not gone far enough with its leadership shake up. “We would rather Danone had gone one step further to replace Cécile,” the said. Artisan Partners, Danone’s third-largest shareholder with a roughly 3% stake, had joined activist Bluebell Capital Partners in urging the firm to find a new CEO and speed up efforts to boost returns. Artisan said on Monday it would comment on the changes at Danone in due course. Bluebell has yet to comment. As CEO, Faber has focused on diversifying into fast-growing products featuring probiotics, protein and plant-based ingredients to counter slower growth in dairy. He is a regular presence on social media, sampling his company’s products and promoting green issues. But under his tenure, sales growth, margins and the share price lagged rivals such as Perrier owner Nestle and Unilever, the maker of Cornetto ice cream and Lipton tea. Cracks had began to appear in Danone’s 16-strong board in recent months, people familiar with the group have said. Danone’s March 1 statement said Faber had the unanimous support of its board and that the company would continue to “engage constructively” with shareholders. (Reporting by Sarah White, Gwenaelle Barzic, Sudip Kar-Gupta; editing by Edmund Blair)