A matter of families

Solvay is part of a rare circle of 'sesquicentennial' family businesses that have been able to adapt to their time without losing their identity. The stability of its shareholding group is one reason for this longevity. Today, the founder families continue to play an important role in setting the directions of the Group and in building its culture.

The founding clan

ts-families1The history of Solvay merges with that of the families which were present at its birth, around the charismatic personality of Ernest Solvay. Around the cradle of the new company, the Solvay family formed a tightly-welded 'clan'. Everyone was involved in one way or another: parents Alexandre and Adèle with financial and moral support, brother Alfred as co-founder, sister Aurélie and wife Adèle as confidantes and first supporters. These were later joined by Ernest and Alfred's children, including future chairmen Armand and Louis. The founding circle also included childhood friend Louis-Philippe Acheroy (appointed senior technician) and Guillaume Nélis, the main individual source of funding. It was through him that the Pirmez and Lambert families agreed to fund half of the operation.

With the incorporation of Solvay as a limited partnership* (in French: commandite), the minority of the shares were held by members of the Solvay family and the majority by the Pirmez, Lambert and Nélis families. Even today, the some 2,500 descendants of this small group remain the reference shareholders.

Remaining "among ourselves", a sensible choice

The limited partnership status offered several advantages, including that of maintaining the corporation's independence, as shares could be transferred only with the consent of the partners, thereby ensuring the closed nature of the society. Nor was there any obligation to publish earnings figures. "To live happy, live hidden"; this was the preferred system for over a century as long as self-financing was sufficient to enable the company to prosper discreetly. Another reason for this stability was purely administrative: changing legal form could have potentially jeopardized the renewal of Solvay's strategic mining concessions.

"The extended industrial family"

Beyond the ties of blood and money, there evolved what Ernest Solvay used to call his "great industrial family" in the spirit of socially-minded owner-management of the late 19th century, in which each employee was considered as part of a family. This circle also included the entrepreneurs from every country that contributed to the internationalization of the company and the progress of the process. With each of these, the Solvay clan maintained friendly and lasting relationships that went well beyond business. This legacy of respect for allies and employees remains today, in other forms, and is still a pillar of the corporate culture.

Inter-generational successions, a major challenge

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In this protected system, the founders' descendants succeeded one another at the Solvay helm. Membership of the family was not enough to reach the top positions; it was also important to have the appropriate skills. Sons were pushed towards civil engineering, and it was customary for the expected successor to undertake a full traineeship. When blood ties reached their limits, in-laws were brought in, with senior positions occupied by Fernand van der Straeten (1894 to 1913), Emile Tournay (1914 to 1947), Emmanuel Janssen (1916 to 1931), Philippe Aubertin (1929 to 1958) and René Boël, appointed as manager in 1931 and chairman in 1964.

Opening up?

In the 1880s the question of the movement of capital among shareholders arose for the first time. The debate on whether to become a public joint-stock company raged in these years between partners and managers, resurfacing at regular intervals whenever the group's long-term future was at stake. The decision finally forced itself on the company in the 1960s: with Solvay unable to grow without outside capital, the status change became inevitable. In 1967, after 104 years of existence, Solvay & Cie became a public joint-stock company and was listed on the Brussels Stock Exchange. This opening to public ownership marked a real historic turning point, changing the governance of the company. But without revolutionizing it.

Smooth evolution

For the historical shareholders, it was inconceivable to surrender family control of the Group. To avoid dilution of their shares and to prevent any hostile takeover, 80% of the first shares issued were registered and subject to restrictions. Fifteen years later, in January 1983, the family ownership group consolidated its positions with the creation of the holding company, Solvac, which was then floated. Inaccessible to institutional investors, the holding company succeeded in stimulating the exchange of shares while preserving the family shareholder control. Gradually, the company's governing bodies opened up to external managers. Albert Bietlot and Edouard Swolfs were appointed to the Executive Committee. But it was not until 1998 that the CEO position passed to a non-family manager in the person of Aloïs Michielsen, succeeding Jacques Solvay and Daniel Janssen, the last two CEOs from the Ernest Solvay line.

A perennial family dynamic

Recent developments at Solvay reflect the dynamics of modern family capitalism, which has learned to combine tradition and openness. Various initiatives aim to maintain cohesion between the 2,500 descendants of the founders, with their smaller or larger shareholdings, such as "young shareholder days" or a private "minifacebook". Always involved in the life of the company, the founding families have kept their influence intact, appointing Nicolas Boël to the chairmanship of the board in 2012. The sale of the pharmaceutical business, the acquisition of Rhodia, and again the appointment for the first time of a non-Belgian CEO, who is neither a family member nor from the Solvay stable, in the person of Jean-Pierre Clamadieu, are all major policy changes supported by the family shareholders.

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* Partnership: company consisting of one or more partners jointly and severally liable with their personal wealth (the managing partners), and one or more providers of funds (silent partners), with their loss limited to the capital invested.