Jean-Pascal Tricoire: Misfit who leaves Schneider as global force

Some board members objected when Jean-Pascal Tricoire was promoted to chief executive of French industrial giant Schneider Electric.

In the cosy world of French business, the engineer, who grew up in the village of Beaupréau in western France and had spent most of his Schneider career in foreign postings from China to South Africa, was something of a misfit.

Without the trappings of elite Parisian schools, political connections and ministerial adviser jobs to his name, his promotion as boss of the automations and software group in 2006 met disapproval.

This week after nearly 20 years at the helm, the 59-year-old, sometimes referred to as “Napoleon running Schneider” among investors for his reputation of wanting to control every decision, announced he was stepping aside, after a reign that outlasted many rival chief executives.

Schneider has become one of France’s most valuable listed companies, its worth increasing sevenfold to nearly €90bn over the past two decades, one of the top 10 market caps on the French stock exchange behind aerospace behemoth Airbus and big luxury goods names such as LVMH.

His appointment was mainly thanks to Henri Lachmann, Schneider’s former boss who plucked Tricoire from semi-obscurity, after crossing paths with him on a tour of the company in Beijing.

“One board member said ‘we don’t know him, he’s not one of us,’” said Lachmann. “But someone else, with an even more brilliant qualification, said ‘that’s his strength’.”

Tricoire will partly relinquish his operational responsibilities to Schneider’s former head of industrial automation Peter Herweck, who becomes chief executive in May, while he remains as chair.

Since his appointment in 2006, after three years as deputy chief executive, the group has expanded exponentially overseas, adding to its array of intricate industrial systems through acquisitions in the US, China and India, and deriving three-quarters of its sales outside western Europe.

Founded close to 190 years ago by two brothers who brought a French iron foundry, it has now also quietly built up a specialisation in technologies equipping it to make the most of a sudden megatrend: energy efficiency.

Systems used by companies to automate their lighting use and make power savings have never been as sought-after, particularly after an energy supply crisis in Europe following Russia’s invasion of Ukraine.

Along the way, Tricoire has maintained his status as something of an “alien” among French chief executives, in the words of one banker. For some, though complimentary about the group’s performance, he has pushed the shift away from France too far.

A fluent Mandarin speaker following a spell in China early in his Schneider career, Tricoire relocated to Hong Kong in 2011 and has stayed ever since — an unusual move that ruffled feathers in the Parisian establishment. The company’s board now has a majority of non-French members, and executives are scattered globally.

Over the years his Asian expertise helped Schneider build up its Chinese presence and also adjust it rapidly, switching away from the construction sector when the residential market began to overheat, said Jefferies analyst Simon Toennessen.

“[Tricoire] took risks in Asia which many more conventional people would not have taken,” said Henri de Castries, the former head of French insurer Axa, who has known Tricoire since he became boss. “Relations may be more complicated and tense with China now, but that kind of deep knowledge of an essential market is very important.”

But that is one aspect of Tricoire’s legacy, with China accounting for roughly 13 per cent of Schneider’s revenue, behind the US, that may become more debatable.

Some western companies are reassessing their Chinese links, after Russia’s war in Ukraine raised fears of more geopolitical ructions, while trade rows brew between Washington and Beijing.

In an interview, Tricoire defended an exposure now being balanced out by investments elsewhere in Asia, and a model based on having a local, Chinese-run business geared towards the market’s very specific tech needs.

“We need to realise that the world is still very interconnected and particularly interconnected to China,” Tricoire said.

Under Tricoire’s tenure, Schneider became known for management practices that are now more widely followed, with a focus on “the planet and society” which it has tried to measure in its performance, including by linking bonuses to emissions goals.

Tricoire said growing up on farms in France’s Vendée region had given him an appreciation for nature and the fragility of ecosystems — as had his favourite hobby, kayaking through rapids. After leaving France for the first time at 23, Tricoire’s spells in emerging markets crystallised his focus on the role the world of energy had to play, he added.

“I realised energy was the passport to a decent life . . . when you had rolling power cuts in China, there were days you couldn’t do much,” he said. “I also realised, living in these megalopolis [very large cities], that our model of energy consumption was not sustainable as the pollution was palpable.”

Tricoire rid Schneider of businesses that did not fit its energy focus, and invested in areas such as software, including with the recently sealed £10.6bn acquisition of Britain’s Aveva, that is used to run data centres or factories more efficiently.

“He’s pragmatic — he’s not into being an evangelist or bashing people [over the environment],” said Cécile Cabanis, deputy chief executive at French alternative asset manager Tikehau Capital, and a Schneider board member. “[Schneider] has advanced without making noise, which is quite rare.”

However, one challenge will be allowing his successor room to lead as he stays on as chair until 2025 at the latest — a formula that is not unusual in France, but is less frequent by governance standards in Britain for instance.

While calm and affable, colleagues and analysts said Tricoire was also known for being on top of every decision at the company, and making sure his teams knew their drill.

“When he became the boss, he was very much the boss — he has authority and doesn’t necessarily like confrontation,” Lachmann said.

“The value he has created is just extraordinary,” said one person in Paris business circles who knows Tricoire. “[But] I just hope he is really stepping aside, his time as chair has already been a very long one.”