Welcome, French Invaders
Alcatel's Serge Tchuruk is stalking Lucent Technologies. Vivendi's (VVDIY ) Jean-Marie Messier grabbed Seagram Co. (VO ) and its Universal film and music. Now, he has bought MP3.com Inc. (MPPP ) and is after Houghton Mifflin Co. (HTN ), the publisher of textbooks used by millions of American kids. And LVMH's (LMVH ) Bernard Arnault, from his swank new New York office, is cherry-picking U.S. brands. It seems downright unfair, especially when you consider how the French protect their own industries. Everything from electricity-generation to winemaking is off-limits to foreign ownership. Then, of course, there's the hero worship of José Bové, the antiglobalism protester who wrecked a McDonald's Corp. (MCD ) outlet in southern France.
The U.S. has little to fear from these Gallic invaders. Tchuruk, Messier, and Arnault aren't modern-day Napoleons looking to subjugate. In fact, they're creating companies that look more American than French. Admirers of U.S. management knowhow and technical savvy, they've given wide leeway to their U.S. units. They've bent over backwards to retain key U.S. execs and even recruited Americans for key jobs in France. Most of all, they're creating a U.S.-style corporate culture, offering employee stock options, and even, in Alcatel's case, adopting English as the company language.
If anyone should be worried about an invasion, it's the French. The increasingly global look of French companies will only add to pressure for overdue economic reforms. France has dragged its feet on privatizing state-owned companies and curbing a bloated welfare state. The governing Socialists refuse to allow private pension plans. And they routinely rail against globalization and "heartless" shareholders.
France's new CEOs see things differently--and they're speaking out about it. Messier told Vivendi Universal's French shareholders at their annual meeting in April that fears that globalization will "make everything uniform and just Americanize it all" are wrong. "I don't believe this for one second. Globalization does not erode cultures. It rejuvenates them and makes them communicate with each other." Messier is expected to move to New York this fall with his wife and five kids. The U.S. should welcome this kind of corporate leader.