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Interview with Franck Riboud

Franck Riboud, Chairman & CEO, Danone
Franck Riboud
Chairman & CEO Danone

What led you to set up the Danone Ecosystem Fund?

The current global crisis has made one thing quite clear: all economic stakeholders involved in wealth creation are interdependent. Even a flourishing firm can become fragile if it’s operating in a weakened environment.

So it’s in a company’s best interests to take good care of its economic and social environment, meaning its suppliers, its employees, its customers and the places where it operates. That’s what I call its ecosystem.

In various places around the world, we have already developed structures designed to promote local economic development. But we now believe that approach needs to be made systematic, expanded and consolidated for the longer term, by creating a specific device, an endowment fund dedicated to strengthening our ecosystem.

“It’s in a company’s best interest to take good care of its economic and social environment”

How do you define the role of the corporation in society?

For a long time, it was generally accepted that a listed company’s primary purpose was to generate maximum value for its shareholders.
But that view is wrong. An approach that focuses solely on maximizing profit is mechanically unsustainable, and will merely serve to weaken the links between the company and its stakeholders, who ultimately feel their interests are being ignored.

A company needs to keep generating value for its shareholders, as without their investment, there’s no economy. But it also needs to create wealth for its own ecosystem, since its long-term future depends just as much on that.

How does this new initiative fit in with the Danone culture?

The creation of the Fund is in line with the dual economic and social project that has been the leitmotif for Danone for close to 40 years:

  • pioneering new approaches to training,
  • industrial relations and profit-sharing,
  • developing innovative environmental practices,
  • launching major social initiatives, such as our work with Muhammad Yunus.

With the Danone Ecosystem Fund, we are continuing in the same vein, opening up new ways of looking at the company’s role in the economy and civil society.