Last week, I attended the World Forum in Lille. All the event was remarkable (and I’ll come back to it in other posts), but I have been impressed by a small and well-hidden nugget : the unique governance of a family business, Leroux Chicory.
Well known in France for its brand (the company used to be the second advertiser on TV in the sixties), Leroux’s holding FINALER reprensents a 40 million euros business, with 3 subsidiaries in France, Belgium and Spain. FINALER exports 17,5 tons of finished goods in 50 countries and employs 190 people.
Leroux has a tradition of business, social and environmental innovation. At the end of the 19th Century, it has been a pioneer in creating various benefits for its employees (housing, healthcare and life insurance). Closer to us, in 1998, Leroux has been the first among European food manufacturers in implementing a revolutionary water treatment.
What is unique is the fact that two brothers (Christophe and Olivier Hermand) – grand-grand sons of the founder – now run the company but without owning it. FINALER is 99,9% owned by a not-for-profit organization (Association loi 1901 in France, equivalent of a 501c). Instead of transferring ownership of the company to his sons, Hermand’s grandfather created this not-for-profit and transferred all his assets to it, in order to make sure that the company values would remain over the years : innovation, valorization of company’s cultural and economic heritage, commitment towards the community. The 7-people Board of this not-for-profit organization consists of 5 independant members and the 2 co-CEOs of FINALER. The five independant members are chosen by the Hermand brothers and they are acccountable for the respect of the not-for-profit organization purpose and values.
In a time where many people try to find new forms of governance for large businesses or for common good initiatives, I found this example very inspiring :
- business finality is present, but it is clearly (and practically) included within a larger purpose
- values are made explicit and the main governing body has a primary role in caring for how they live in the organization
- willingness to increase shareholder value cannot pollute relationships between all stakeholeders
Can such principles and operating modes of governance inspire other organizations ?