Schneider Electric boss to step down after two decades

Schneider Electric’s Jean-Pascal Tricoire is set to step down as chief executive after nearly 20 years at the helm, with the French automation and software company turning to an insider as it tries to capitalise on rising demand worldwide for its energy-saving systems.

Peter Herweck — formerly Schneider’s head of industrial automation and now CEO of Aveva, the British software group it is taking over — will become chief executive in May. Tricoire is set to stay on as chair until 2025 at the latest.

Propelled to the top in 2003 in the aftermath of the blocking by antitrust regulators of Schneider’s attempt to buy French electronics group Legrand, Tricoire changed the group’s direction with a big push into overseas markets including the US, China and India.

He also refocused the group on systems for making buildings and factories more energy efficient while branching into areas such as smart technology, including through a string of acquisitions.

These have included the long-running takeover of Aveva completed last year, a £10.6bn deal initially contested by some investors, who eventually managed to obtain a higher bid.

In recent years, supply chain problems, including the scarcity of electronic chips since the height of the Covid-19 pandemic, have proved a headache for Schneider, though the setbacks are now easing.

But demand for the automated lighting and cooling systems that Schneider produces has also grown sharply.

Increasing pressure is falling on companies and governments to do more to lower emissions, while the chaos in European power markets following Russia’s full-scale invasion of Ukraine has also pushed many to review their energy use.

“We’re at a moment of real convergence between everything we’ve put in place and the world’s needs,” Tricoire told the Financial Times.

Europe could “absolutely” do with a massive investment plan to rival the recently launched $370bn US package of green-tech subsidies and incentives, Tricoire added. The region had a “level of urgency that has nothing to do with the US, as Europe has an energy supply problem”, he said.

Schneider on Thursday reported an 18 per cent rise in 2022 revenues to a record €34bn, slightly above analyst expectations in a Refinitiv poll, helped especially by North America, which overtook Asia as the group’s biggest region.

Net income was up 9 per cent at €3.5bn when taking into account one-off charges such as a hit from its Russian exit last year, when it sold the operations to local management.

Tricoire said he expected a further acceleration in Schneider’s US performance in 2023, while China would remain slower in the first quarter as it eases out of strict lockdowns.

The Schneider chief — who relocated to Hong Kong in 2011 in an unusual move for senior staff of a French company, part of a broader shift by the company to scatter top executives globally — said he had no qualms about the Chinese push he had spearheaded over the years.

“My vision of the world is that it will remain a very globalised and interdependent one,” Tricoire said.

Herweck, a German national who lives in Switzerland, will become one of only a small handful of non-French bosses at the head of top companies.

Schneider, founded in the early 19th century as a mining and smelting group, is now one of the 10 most valuable companies in France’s blue-chip CAC 40 index, behind luxury goods players such as LVMH and aerospace company Airbus.