Loss of family leader reminds of great change

by Morton Sosland
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International grain trading, once a business dominated almost entirely by companies under family ownership and family management, is rapidly evolving into professionally-managed enterprises, with only rare instances of direction provided by owning families. Yes, a considerable measure of family ownership remains, but it’s the relatively special enterprise where a member of the owning family is chief executive or even actively involved in running the business. This is great change, affecting in many ways how global grain merchandising itself has been transformed in recent decades from what it was for most of the 19th and 20th centuries.

The breadth of this change was brought to mind by the death early last month of Jean Louis-Dreyfus, whose career with Louis Dreyfus & Co. spanned an incredible seven decades. A grandson of Leopold Louis-Dreyfus, who founded the company at the middle of the 19th century, Jean Louis-Dreyfus was chairman and chief executive officer in the tumultuous period between 1967 and 1975, when he became vice-president of the board, the position he held at the time of his death. It was in 1975 that his cousin Pierre’s son, Gerard Louis-Dreyfus, became chief executive, the position he holds to this day.

Jean Louis-Dreyfus was a graduate of the Lycee Louis le Grand in Paris, and had been associated with the company since 1930. He became a co-owner of the company in 1940 when his father, Louis Louis-Dreyfus, was killed in an accident just before the German invasion of France in 1940. At the time of his active management of the company, he was very much involved with grain trading, while his cousin, Pierre, built shipping and other interests. Under Gerard’s leadership, the business interests of Louis Dreyfus & Co. have been broadly diversified, even while grain trading is still very much a core activity. Other business interests range from real estate to orange juice, from natural gas to shipping.

Jean Louis-Dreyfus is survived by a son, Robert, who after a brief career with the family company, proved to be a highly successful entrepreneur in totally unrelated businesses. Initially involved in pharmaceutical sales reporting, through IMS International, he later became head of Saatchi & Saatchi, the international advertising agency, and then became named chairman of Adidas, the sports shoe and sportswear manufacturer. That company is now associated with Salomon sports products. He currently heads the Marseille Football Club and Tag-Heuer, the watch company, as well as being chairman of LD Com, a telecommunications business of the family.

Louis Dreyfus & Co. is the only international grain trading enterprise headed by a member of the owning family. In the case of Cargill, Inc. and Bunge Corp., once headed by executives drawn from their owning families, these globe-circling businesses are now directed by people from outside. Two other once-prominent international grain trading enterprises at one time were headed by family members. Continental Grain Co., now ContiGroup Companies, Inc., is no longer in grain trading — although Paul Fribourg, its chief executive, is from the owning family. And the Andre family of Switzerland has been forced by business setbacks to withdraw from grain.

In a tribute to Jean Louis-Dreyfus, his son, Robert, and his cousin, Gerard, gave expression to what makes a family-managed business unique. Citing "his gentle presence and his example of dedication," they "note and herald the selflessness that he exhibited throughout his long years as owner and protector of the family enterprise." Words like that, accompanied by a "pledge" to follow his example, are not heard in businesses where family members are less intimately involved. It reflects a totally different era, not just in grain trading, but across the entire range of grain-related businesses operating in every part of the world. Family ownership and management in numerous instances, not just in trading, but also in milling and in other aspects of grain processing, are giving way to new style leadership. It’s likely that a wide range of views prevails as to whether this is superior to the old. The one certainty is how much the industry has changed over the remarkable 70-year career of one individual, Jean Louis-Dreyfus.